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NEW YORK — Macerich Co. is strengthening its dominance of the Arizona market, with the ongoing buildup of the massive SanTan Village mixed-use lifestyle center.

“This will be the state’s biggest project,” said Tracey Gotsis, senior vice president of development marketing, Macerich Co. 

Currently, the biggest in the state is Chandler Fashion Center in Chandler, Ariz., which has 1.7 million square feet. It’s also a Macerich project.

Located in the fast-growing Phoenix suburb of Gilbert, SanTan Village encompasses about 2.5 million square feet on 500 acres, with 1.2 million square feet devoted to three power centers, and 1.3 million square feet for a regional shopping center. It’s anticipated that 185 stores will be on the site, with 150 in the regional shopping center and 35 within the power centers. 

In terms of sales volume, Jeff Green Partners completed a feasibility study that projects the regional shopping center portion will be performing more than $400 in sales per square foot after the first year or two of operation when it reaches its “stabilization” point, meaning when there is enough critical mass, or gross space leased, to accurately measure performance.

The power center portion is projected at $300 in sales per square foot, when it reaches its stabilization point.

The mixed-use project is an open-air setting catering to families. The only enclosed area is the food court.

The power center — including Bed Bath & Beyond, Circuit City, Costco, DSW, JoAnn Super Store, Marshalls, OfficeMax, Razmataz, Sam’s Club, Wal-Mart Supercenter and Ulta — has been opening in phases since last summer. Some of the stores are already conducting business.

The regional center breaks ground in February and is expected to be open for business in fall 2007.

Among the retailers signed on for the regional center are Chico’s, Coldwater Creek, J. Jill, Lucy, White House|Black Market, Z Gallerie, Dillard’s and a Harkins Theater. Macerich still needs to confirm that Macy’s will move in. Macerich was counting on Robinsons-May to move in. However, the retailer is a division of the former May Department Stores Co., which was taken over by Federated Department Stores Inc., and Federated is converting most May stores into Macy’s, leaving some uncertainty.

This story first appeared in the October 24, 2005 issue of WWD. Subscribe Today.

Aside from seeking Macy’s, “We are trying to get an upscale grocer, a home furnishings player, and a big box sports player,” Gotsis said. “Right now the demand in Gilbert is for middle-market and bridge retailers.”

But, she added, SanTan Village is designed for flexibility and will adapt its retail mix as the community evolves.

SanTan Village is about 20 minutes southeast of Phoenix on the new 202 Freeway, and will also include some space for office and hotel use. 

Macerich, based in Santa Monica, Calif., controls the Arizona market through its Phoenix-based Westcor subsidiary. It owns all the regional shopping centers in the state, except for Arizona Mills, which is owned by Mills Corp.

In Arizona, Macerich owns 11 super regional shopping centers, three specialty retail centers and 22 power centers, for a total of 22 million square feet. Nine centers are in the Phoenix area.

According to a Westcor statement: “SanTan Village will create a vibrant, sustainable urban village designed on a human scale to create comfort and a sense of belonging, and all elements will be connected to encourage pedestrian interaction.”

The architects on the project are Omniplan of Dallas, and Ellerman & Schick, of Phoenix.

According to the developer, SanTan Village is distinctive not only because of its sheer enormity, but because it’s practically an entirely open-air project, whereas typically other major Arizona projects are enclosed.

It’s also conceived as an “urban village that is designed to serve current residents, while accommodating continued growth and demand. The variety of retail uses provide more choices and flexibility to appeal to a variety of lifestyles.”

There are also spaces and buildings that interconnect to create a sense of place, and a design that allows consumers to easily navigate within the development, with wide walkways, and bicycle accessibility, according to Macerich.

Macerich said SanTan Village will serve a large geographical area from the Superstition Freeway (Highway 60) on the north, Arizona Avenue on the west, and into Pinal County to the southeast.

Gilbert has a population of 290,000 people, but is projected to grow to 425,250 people by 2010; 525,000 by 2015, and 615,800 by 2020. In 2003, Gilbert was named the fastest-growing U.S. city based on Census Bureau figures. Each month, about 1,000 new residents move in.

Macerich also said the trade area’s average household income is $70,994, and the median value for a new home is $207,000. The area is made up predominantly of young families, with 35 percent of the population between 25 and 44 years of age.

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