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The basics:

• Garden State Plaza adding 575 luxury apartments in Paramus
• $300M mixed-use project includes retail, public green space
• Development aims to create a walkable town center
• Mall owners see housing as key to retail’s future

Once the suburban superhero, shopping malls have had to evolve to stay competitive amid changing consumer dynamics. Inside, successful operators are leaning into experiential retail and community programming to draw traffic and replace declining, or disappearing, department store anchors.

American Dream in the Meadowlands offers an outsized example. Beyond the rise of “retailtainment” and alongside a dire need for added housing, some properties are also looking to mix things up in a different way.

Kushner Cos. is turning the former Monmouth Mall inside out to develop the rising Monmouth Square open-air concept in Eatontown. Similarly, in East Brunswick the struggling Brunswick Square Mall is undergoing a redevelopment to transform and revitalize the enclosed property. The 750,000-square-foot Middlesex County project from Paramount Realty and Edgewood Properties will retain successful operators, bring in a major medical tenant and emphasize lifestyle services.

The developers are also working with the municipality to develop a master plan that would bring residential into the mix in the form of both market-rate and affordable units.

That tactic is one successful operators also are employing. The play can present a compelling opportunity as retail vacancy rates tighten and construction costs remain prohibitive. On the public side, mixed-use redevelopment presents a viable path toward retaining ratables and encouraging walkable development.

Reinventing NJ’s first mall

At Westfield Garden State Plaza, construction began earlier this spring to establish a mixed-use development on the 30-acre property. The four-phase project at the state’s second largest shopping mall will add 575 luxury apartments along with retail and green space.

This work isn’t Garden State Plaza’s first transformation. The midcentury-era shopping mall debuted as an open strip before its enclosure.

Dating to 1957, Westfield Garden State Plaza holds distinction as the state’s first shopping mall. Over time, the property along Route 17 has emerged as a community anchor, and its planned next phase leans into that role.

Situated in a locale without downtown, now it’s literally – and intentionally – building one.

Nationwide, about 1,000 malls continue to operate. Reports citing Green Street Advisors also put the figure of enclosed, Class A regional malls at about 250. Along with development designs, preserving these remaining entities is often a local priority.

Malls are typically the largest tax ratable in a municipality. Recent figures from the International Council of Shopping Centers attribute $400 billion in local tax revenue annually to malls and shopping centers.

In Bergen County, the mall’s latest evolution will densify the area surrounding the retail asset to establish a walkable town center “connected” to the larger commercial property. The space will offer restaurants, essential services, apartments and more to help promote a walkable, connected community.

Why it works

While some shopping malls seek transformation for survival, Westfield Garden State Plaza is successful. Quite successful, in fact.

The property is one of Unibail-Rodamco-Westfield‘s flagship locations in the U.S. It also ranks as one of the top performing assets of its type nationwide. And that success comes without Sunday shopping, stemming from local Bergen County Blue Laws that restrict retail sales that day.

Looking toward the future, Stephen Fluhr, senior vice president of development for URW, told NJBIZ the mall itself is as big as it needs to be. “And by saying that, I really mean we have the ability to continue to reinvent and involve the retail and entertainment experience forever in that format. … [W]e wanted to figure out how do we make the retail asset even stronger?”

Fluhr said the densification brings in complementary uses to that end.

“We also want to take the opportunity to begin to recreate the site itself, so the general public begins to perceive us as more than just the plaza,” he added.

No shortage of shops

Westfield Garden State Plaza sits at the intersection of Routes 4 and 17 in one of the nation’s strongest shopping corridors. It boasts a 7.6-million-person catchment area.

Anchored by Neiman Marcus, Nordstrom and Macy’s, Westfield Garden State Plaza also features a premium fashion district featuring luxury brands such as Louis Vuitton, Gucci, Tiffany & Co., and Versace. The property’s nearly 300 shops and more than 40 eateries welcome approximately 20 million shoppers per year.

The 2.1 million-square-foot property also offers vibrant programming, experiential and entertainment concepts, including an AMC Theatres.

Development details

Mall owner Unibail-Rodamco-Westfield tapped Mill Creek Residential as co-developer for the launch of the four-phase Paramus project in 2022.

The more than $300 million Modera at Garden State Plaza will comprise two mixed-use midrise buildings. Approximately 50,000 square feet of space, along with parking, will complement the residential units.

According to project partners, the development design aims to reduce carbon footprint, promote sustainable practices and minimize waste. To achieve those goals, the work incorporates renewable energy and natural materials. It also emphasizes increased access to public transportation. Phase 1 will include EV charging stations. Project partners said a future phase will include significant upgrades to public transportation networks.

Cushman & Wakefield’s Equity, Debt & Structured Finance team arranged financing on behalf of Mill Creek for the Modera Garden State Plaza project. The team included John Alascio, Alex Hernandez, Alex Lapidus, Chuck Kohaut and Chris Meloni.

The power of partnership

Officials, project partners and stakeholders celebrated the Phase 1 groundbreaking at Westfield GSP earlier this spring. The effort offers a prime example of how developers – and public sector partners – are helping shape the lifestyle experience around these retail assets and in their communities to establish a new sense of place.

Legacy labels

The work in Paramus will add new thoroughfares. Revealed during the groundbreaking event, street names in the forthcoming mixed-use development at Westfield Garden State Plaza’s legacy honor the center’s history:

• Marquee Lane: Pays tribute to the drive-in movie theater that was once a part of the Westfield Garden State Plaza site.
• Bambergers Lane: Bamberger’s Department Store is considered the cornerstone of Westfield’s early success.
• Sprout Green: At the heart of the new development, the name of the vibrant town green reflects the site’s ecological heritage and recognizes Sprout Brook, a longstanding stream that runs through the landscape.
• Sprout Crescent: Chosen for the loop that wraps around Sprout Green to evoke a sense of continuity. This channel will connect the residences, retail and gathering spaces.
• Plaza Passage: A symbolic corridor that will connect Westfield Garden State Plaza “with its next chapter as a vibrant walkable neighborhood.

Westfield purchased the property in 1996. “Thirty years, we’ve been a proud custodian of this piece of amazing real estate,” Unibail Rodamco Westfield U.S. Chief Operating Officer Dominic Lowe said during the late April ceremony in Paramus. “And we’ve continued to invest in it … but this feels different.”

“It is easy to see some trucks … and some diggers out there, but this has been a long journey,” he added.

Beyond taking the time to get the design correct and center its own intent with the work, Lowe added, “it’s also about our partnerships.”

Creating ‘magic’

Collaborator and Mill Creek Executive Managing Director for Development Doug Arsham described the mall as the gravitational center of Paramus and the region. He said the retail asset is a compelling investment.

“When you take the new apartments and create another component to the master plan, if you will … there is definitely a magic that happens between where people live and where they know they can play and shop,” he told NJBIZ.

Taken together, the combination of retail, residences, public space, and transit and highway access “creates almost a perfect storm for us to be able to synthesize the kind of community that we’re looking for.”

This Modera project is the largest in Mill Creek company history.

Part of the reason being it’s harder to get financing when unit counts top 500, Arsham said. “But because of the location and because of the project itself, we were able to secure financing and get it done.”

If you build it …

And he’s confident the units will get filled. “Because we know that this is a place that people are going to want to be.”

The residential buildings coming to One Garden State Plaza Blvd. will offer one- and two-bedroom apartments. Select units will feature layouts with dens and private patios or balconies.

Amenities will include a rooftop deck, swimming pool, sauna, outdoor kitchen area and fire pits; a resident clubhouse; fitness center and more. On the productivity side, residents can also access coworking spaces, private workstations, a conference room, digital package lockers, garage parking, bike store and repair station, and additional storage space.

Based in Boca Raton, Fla., the national investment and rental housing company focuses on developing, acquiring, constructing and operating multifamily and built-to-rent single-family rental communities in targeted areas. Its New Jersey portfolio comprises nearly a dozen properties.

Live, work, play and stay

As the shift in retail creates opportunity, an evolving rental market also lends itself to supporting the kind of multi-generational community that can help live, work, play and stay projects thrive.

In an age when folks are renting by choice, and not just necessity, “the rental pool itself is just bigger,” Arsham explained. “Much, much bigger. Of just different types of people.”

That fabric mirrors the connections across the larger work that Fluhr says URW seeks to accomplish. “You’ll look at some projects that maybe have a building out in the parking lot.” They’re providing the use, he explained, “but it’s kind of an island to itself.”

Paramus, along with URW’s other U.S projects, “are really focused on, how do we do them in a very connected way that if you live here, the mall’s an amenity. And if you’re in the mall, everything that we’re creating … becomes an additional amenity for those that live in that community.”

The mixed-use expansion also helps drive dwell time. “You spend more time when you have opportunities to do different things on site,” Fluhr said.

URW handles leasing for both the shopping mall and the forthcoming retail component at Modera GSP. By controlling the whole site, the company can cultivate commercial mixes that complement – rather than compete with – each other. Fluhr highlighted users that want to be near a mall, but not necessarily inside of one, like local retailers.

“It really gives us an opportunity to talk to regional players and local players to bring that sense of community right up front,” he said. “And we have the ability to put them in … these buildings. So, it helps intensify that kind of community feeling.”

More than retail

Incorporating local operators can also help build up a kind of credibility. “We really want it to feel like a place right when we open, and in order to do that, you get some authenticity by going in on some of those local players,” Fluhr added.

Speaking during the groundbreaking ceremony, Lowe said the concept “is pretty simple.

“We’re in the human business. Retailing has always been that place where people want to find a connection and meet and greet – whether it’s loved ones or new people they haven’t met yet. It’s always the meeting place, but it’s so much more than that now.

“Retailing is really about … more than just offering retail.”

Fluhr noted the role of creating intentional common areas in driving connections. “We’re really focused on those details,” he said, highlighting the investment to establish a 1-acre town green within the emerging neighborhood.

URW plans to activate the space, too, with concerts, seasonal fairs and more. “That becomes the connective pull between what’s happening at the plaza and what’s happening in this extension of the community.”

A pedestrian walkway on the western side of the shopping center will connect to the mall. URW said it is exploring a hotel, medical offices and senior living for future phases.

“This project is a story of perseverance and teamwork, listening to the community, making commitments and delivering on them. And today’s only the beginning,” Fluhr said at the top of the morning event.