Heres the story...

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Roll right out of bed and into the mall
Condos, lofts going up at retail meccas around Valley in housing trend

Erica Sagon
The Arizona Republic
Aug. 9, 2005 12:00 AM

Many people in the Valley already feel that shopping centers have become their second homes, but soon they literally will be able to live at the mall.

Hundreds of condominiums and lofts are in the early-planning stages for Valley malls, both existing locations and malls still on the drawing board.

Thirty lofts already exist at Kierland Commons in north Phoenix. A project is in the works at SanTan Village in Gilbert. And housing has been built along with other shopping centers across the country as part of developers' efforts to reinvent the role of the shopping mall.

A resident in one of the 1,100- to 2,700-square-foot condos above Kierland Commons can get home from work, run downstairs for a steak or seafood, try on a new outfit, pick up a coffee and buy a book to take back upstairs and read before bed.

Building residences along with retail space is a new subset of a larger mixed-use development trend, bringing together shops, restaurants, entertainment, offices and housing. It is expected to bring shoppers closer to the malls and offer a faux-urban neighborhood for those who can afford it.

Westcor, the Phoenix-based company that owns most of the Valley's malls, wants to add condos to Biltmore Fashion Park and Scottsdale Fashion Square, but the company says it has not ruled out any of its 10 existing malls for redevelopment that includes housing.

In addition, most of the five new regional malls Westcor has planned for the edges of the Valley will include apartments or condos. The next retail/housing project will be at Gilbert's regional mall, SanTan Village, where plans call for condos on top of parking garages next to the urban-style, open-air shopping center. The project is scheduled to open in phases, with completion by fall 2007.

SanTan Village is expected to be similar to what already exists at Kierland Commons, owned by Woodbine Southwest Corp. and Westcor. Kierland Commons, known as a "main street" development, recently added 30 lofts on top of a new row of upscale stores, including Coach, Bebe and BCBG.

Resident Ken Clark, a 54-year-old real estate agent, said he had eyed the Kierland Commons project, thinking a loft there would be a good investment, but convenience was the main draw.

Clark and his wife, Debra, live above Banana Republic, in an $800,000, two-bedroom loft that overlooks the shopping center's main street.

Early next year, work on an additional 55 lofts on top of a parking garage will break ground.

Adding housing into the mix is just one way that mall developers like Westcor are changing the look and feel of traditional retail centers.

The idea of a mall is shifting away from enclosed spaces flanked by department stores, and in some cases developers aren't even including department stores in their plans. Architecture, design and landscaping more often than not mimics the open-air feel of an urban streetscape.

"What has replaced downtown is the mall," said Jay Butler, director of the Arizona Real Estate Center at Arizona State University. Although existing traditional malls still do thrive, just a handful of such shopping centers will be built in the foreseeable future, according to industry analysts.

"As we move forward and ask what's the next huge wave, it may certainly be this," said Patrice Duker, spokeswoman for the International Council of Shopping Centers.

Westcor said incorporating housing into malls could make shopping destinations more sustainable.

"As this town approaches 4 million people, I think there is enough critical mass to have an urban living environment," said David Scholl, Westcor senior vice president of development.

The company's sweeping redevelopment plans for Biltmore Fashion Park at 24th Street and Camelback Road include condo towers, but Westcor wants to build higher than the city will currently allow.

Condos at Scottsdale Fashion Square could be built on the Days Inn site to the north of the mall. Westcor will regain control of that land in about three years. If the livable-mall trend is still hot, Scholl said, that spot will be prime for housing.

The company is also eyeing Chandler Fashion Center and other existing malls for housing, partially due to the success of Kierland Commons.

The Clarks represent the industry's most targeted demographic: empty-nesters with disposable incomes. Industry watchers say young singles also gravitate toward this lifestyle, but they often are priced out. At Kierland Commons, lofts went for $400,000 to $1 million.

Butler, of ASU, questioned the practicality of such expensive living. Some of the condos and lofts are "so high-end, you sort of wonder who they're going after," he said.

Drawbacks to the lifestyle include noise from the occasional delivery truck. Residents can also expect traffic and a flow of shoppers and diners into the evening, just like any other mall.

"I went there because of that, not in spite of that," said Willy Theisen, who moved into a $635,000, one-bedroom loft. "If I wanted total solitude, that wouldn't be the place to go."

The Clarks dine at Kierland Commons' restaurants four or five times a week, and shopping is a cinch when it's just a floor below.

"My wife loves Bebe," Ken said. "We find ourselves down in those shops more often than we should be."

Duker, from the International Council of Shopping Centers, said it could be a real benefit to retailers to have a core of consumers living on-site.

She also pointed out that it does take the right mix of retailers to pull off a livable mall. They are typically trendy, upscale stores.

"You're not seeing discounters in these types of environments," Duker said.

At Gilbert's SanTan Village, however, big-box stores and discounters will co-exist with upscale shops and housing.

And at the heart of Verrado, the master-planned community in Buckeye, people live among more practical shops, such as a Bashas' grocery store. Scottsdale-based developer DMB built Verrado.
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I can't believe that! What some people will do....