Gulfstream Retail Development Progresses
Magna Entertainment Corp. and partner Forest City Enterprises announced Feb. 26 the first 32 tenants for the retail portion of their The Village at Gulfstream Park development. Plans for the $1.2-billion complex, adjacent to Gulfstream’s clubhouse/casino building, include a hotel and condominiums on the property in Hallandale Beach, Fla.
Meanwhile, officials are reluctant to speculate on a possible bankruptcy filing by MEC.
MEC and Forest City, the project’s Cleveland, Ohio-based developer, set Feb. 11, 2010, as the opening date for the complex. The retail/restaurant portion of the mixed-use complex will have space for 70 tenants. Buildings in the 400,000-square-foot first phase also will include office space.
William Voegele, a vice president for Forest City’s commercial group, said Forest City and MEC hope to announce additional tenants later this year. Crate and Barrel, the contemporary furniture store, and Pottery Barn, the home-furnishing chain, will be among the first tenants. The list of restaurants includes The Playwright Irish Pub, Haagen-Dazs, III Forks steakhouse, and The Cheese Course. Clothing stores will include Scala, a Brazilian designer; Valhalla Menswear; and Next Authentic.
“We will be a high-end retailer and a destination,” Voegele said. Forest City and MEC hope the retail mix will be attractive to Gulfstream’s racing fans and patrons of its casino, he said.
The retail phase that will open next February will have a five-story parking garage with 7,500 spaces, which racing patrons also can use.
The Village of Gulfstream Park retail complex is preparing to open during “what is certainly a challenging economic environment,” said David Dabby, president of Dabby Group, a real estate consulting and valuation services firm in Coral Gables, Fla. “But they will be opening at a time when there will undoubtedly be no other new retail competition in their market.”
The economic performance of the Gulfstream retail complex in 2010 will depend largely on “the length and depth of the recession,” Dabby said.
Voegele would not disclose lengths or rates for leases. But he said tenants will be paying “market rates” for this economy.
Forest City and MEC announced plans for their mixed-use project in 2004. Construction of the retail phase began in 2007. Forest City is not setting timetables for start of construction of other components of The Village of Gulfstream Park.
When asked how a possible Chapter 11 bankruptcy filing by MEC might impact completion of construction of the retail complex, Voegele said: “We never talk about the hypothetical.
On Feb. 18, MEC called off a reorganization program for the company and its controlling shareholder MI Developments. MEC said it might not be able to meet some of its financial obligations unless a series of alternatives are found.
MEC is facing March maturity dates on two loans from MID and a $40-million loan from a Canadian bank, believed to be Bank of Montreal. The maturity date is March 20 for repayment of $100 million of a bridge loan from MID for financing construction at The Village of Gulfstream Park.
MEC officials have declined comment on the loans beyond their news releases and SEC filings.
On Feb. 25, the Hallandale Beach City Commission approved an agreement to give MEC and Forest City a maximum of $900,000 a year in city tax revenue for 15 years, starting in 2011, to help fund development of the complex. Voegle said the partners will use the tax revenue in building more parking space and infrastructure, which he expects will “help attract more high-end tenants and more revenues.”
Hallandale Beach hopes The Village at Gulfstream Park “will become our town center,” said Joy Cooper, the city’s mayor. Cooper declined comment on the prospect of MEC filing for bankruptcy.
“Whatever happens, racing is not going to go away at Gulfstream,” she said. “Magna knows its business. If something like that happens, someone else will run it at least for a while. (MEC chairman) Frank Stomach and Forest City would not have gone forward and would not be continuing with brick and mortar if they were not confident that everything will be completed.”
The project’s retail complex will include a pedestrian area east of and separated from the walking ring. That area will have stages for concerts during non-racing hours.
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