Retail Apocalypse? Strategic Planning Helps Valley Shopping Center Thrive in Competitive Market

There seem to be ways around the so-called
“retail apocalypse,” but it means more work and
spending more money for the owners and
operators of shopping centers.

The retailers at Desert Ridge Marketplace, a
shopping center located in north Phoenix off
Loop 101 at Tatum Boulevard, have apparently
bucked the trend and reported sales growth
greater than 40 percent over the past five years,
according to Vestar, the property’s owner.

During that time, Vestar invested $22 million into
Desert Ridge Marketplace, renovating buildings
and public spaces, upgrading signage and adding
amenities like bocce ball courts, children’s play
areas, electric vehicle charging stations and stateof-
the-art video walls.

“In the shopping center world, you can’t simply
be a passive owner and operator,” Vestar
President David Larcher told the Phoenix
Business Journal. “You can’t just wait for the
rents to come in every month. It’s a fully
integrated operation.”

Vestar also holds hundreds of public events at the
space. Larcher said the company found people
will come out for unique experiences.

Focus on tenant mix
Desert Ridge Marketplace has benefited from the
large increase in population to the surrounding
area in the last 18 years, after the center was first
built. But just being near people doesn’t cut it,
Larcher said. Other centers nearby don’t attract
the high quality of tenants that Vestar does.

In early 2019, 12 new tenants will open at Desert
Ridge Marketplace, totaling more than 100,000
square feet, including H&M and Copper Blues
Live, a restaurant and entertainment venue that
also operates a location downtown at CityScape
Phoenix.

Larcher said his team focuses on getting the right
mix of tenants that will be able to drive traffic to
other businesses on the property. Restaurants are
a large part of that philosophy.

“The days of food and beverage being somewhat
of an afterthought – those are long gone,” Larcher
said. “The food and beverage component is really
a focal point. At any successful center today,
restaurants are taking up a significantly higher
percentage of the leasable area than they have
historically in years past.”

Having a good mix of restaurants, including a
number of chef-driven concepts such as Barrio
Queen and Sam Fox’s Flower Child, along with
everyday retailers such as Albertsons and Target,
Desert Ridge is able to steer customers to its other
tenants, especially its big box retailers, Larcher
said.

“We have several big boxes that normally produce
the best numbers out of all their stores in the
market, if not the highest numbers,” he said.
“Every year the numbers continue to prove that
big boxes have the ability to succeed here,
contrary to conventional wisdom on the future of
these big stores.”