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Commercial Real Estate
Business Observer Friday, Nov. 30, 2018 1 week ago

Developer builds centers of attention

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Retail center developer S.J. Collins seeks to enhance communities with purposeful design and mix of tenants. Daniels Marketplace in Fort Myers is its latest example.
by: Andrew Warfield Lee-Collier Editor

When S.J. Collins Enterprises takes on a retail or mixed-use development project, it approaches it from more than demographic and financial analysis. It also likes to partner with the surrounding community to solve problems.

Such was the case at Daniels Marketplace, its recently completed retail center in Fort Myers on Daniels Parkway. The company took a 10.5-acre site that was problematic for the adjacent neighborhood of Brookshire, converting it into a community asset. That approach, says S.J. Collins Partner Jeff Garrison, fosters a positive relationship with the community and helps ensure success. 

At 135,655 square feet, Fairburn, Ga.-based S.J. Collins invested $75 million in Daniels Marketplace, which is anchored by a 45,000-square-foot Whole Foods. It moved an undersized drainage pond from the front to the rear of the property and expanded it to solve a neighborhood flooding issue. It also rezoned the property from a higher-density use that would have allowed more intense commercial uses.

“We worked for more than a year with the homeowners association on a plan that would effectively deal with some of their flooding issues and create a win-win for the development and the neighborhood,” says Garrison. “The zoning on the vacant property was super dense, which could have had hotels and offices, so we worked with the community to bring a development at a scale that was more appropriate for the site.”

S.J. Collins also worked with surrounding businesses when planning the 52,528-square-foot University Station in Sarasota. That center, also anchored by a Whole Foods, opened on four acres on University Parkway in September 2017 at a total investment of $27 million. (That project included a dose of controversy: Environmental groups had contended Sarasota County officials erred in approving the project because it was inconsistent with the county's policy for preserving wetlands. S.J. Collins bought 40 acres connected to Rye Preserve in north Manatee County for off-site mitigation, and also spent more than $2 million in permits and legal fees.) 

'We want to be part of the solution because we view that as vitally important to the success of the project.' Jeff Garrison, S.J. Collins

“When we were planning University Station, we had neighboring business owners tell us they were concerned about having better access points to their own businesses and getting people in and out, and we solved it with our design,” says Garrison. “We want to be part of the solution because we view that as vitally important to the success of the project.”

Strategically common to many S.J. Collins centers is Whole Foods along with non-fast food dining options such as Panera Bread, Zoe’s Kitchen and First Watch or Keke’s Breakfast Cafe. Because its centers are designed to draw from a wider geographic area, the company looks for locations served by thoroughfares and a tenant mix that includes everyday uses such as nail salons, small fitness or pilates centers, unique boutique, massage, dry cleaners, tutoring centers and more. 

The mix of businesses that draw customers at different times of the day is intentionally designed to help minimize parking lot congestion.

Rendering of Daniels Marketplace in Fort Myers. Courtesy S.J. Collins

“Our parking lot needs to breathe,” says Garrison. “We try to limit the number of restaurants and make sure they are not all sit-down. Where you have night have a Mellow Mushroom that draws a lot of traffic at night we also have Keke’s, which closes at 2 p.m. You want the parking to ebb and flow so that it’s always easy to find a parking spot.” 

S.J. Collins develops, owns and leases retail and mixed use centers in five states, all east of the Mississippi River. Some include a residential component, but all follow the company’s standards of site accessibility, purposeful tenant mix, sensitivity to the surrounding community and creating a sense of place, says Garrison.

As the company looks to 2019, Garrison sees escalating land prices as the most significant challenge facing commercial development. 

“Landowners expect their market value to go up 15% every year,” Garrison says. “That will continue to be a challenge in Florida where because of recent history landowners have become entrenched in what they believe their property is worth.”

He says construction costs should remain stable in the coming year because of an anticipated slowdown in retail and overall development. Community resistance to growth, he says, is another obstacle.

“The other challenge we are seeing is communities that are concerned about new development,” says Garrison. “Bringing in a Whole Foods used to have a very positive effect in surrounding property values and for adjacent residents who can walk to the store if they want. Now we are seeing a lot more scrutiny in communities that have experienced fast growth and they are wanting to hit the brakes a little because things are happening a little too fast for them.”

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