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The Shoppes’ Multipurpose Makeover Is About People Pleasing

After years of delays and ownership changes, it appears that the long-fading mall in northern Carlsbad, known as Plaza Camino Real when it opened nearly a half-century ago, is ready to benefit from an extensive renovation.

Current operator Rouse Properties recently announced that The Cheesecake Factory and Yard House restaurants, along with fashion clothing retailer Zara, will join the tenant roster in 2017 at what is now called The Shoppes at Carlsbad. It is the latest in a multiyear wave of major shopping center transformations in San Diego County.

New York-based Rouse purchased the mall, formerly known as Westfield Carlsbad, from Westfield Corp. for $170 million in November 2015. Westfield had partially completed what was earlier announced as a $300 million renovation of the Carlsbad property. Construction is now underway at 2525 El Camino Real near state Route 78, with completion of multiphase renovations expected by the end of 2017.

A new Carlsbad venue called Park 101, with multiple dining and retail elements, is under construction on Carlsbad Boulevard. Rendering courtesy of Park 101

Rouse’s renovations at the two-story, 47-year-old mall will include changes to the property’s ceilings, tiles and flooring, with a streetscape being designed to unite the center’s indoor and outdoor elements. Rouse is bringing in new full-service and fast-casual dining options and creating plaza areas with trees, outdoor seating and ambient lighting.

Rouse has not divulged expected costs for the renovation. “It is a significant spend that the residents of Carlsbad will appreciate,” Rouse CEO Brian Harper said. “We asked what people want to see, we’ve listened and we are going to deliver.”

Rouse is the latest local mall operator to join a national movement to convert malls into much more multipurpose venues, emphasizing entertainment, dining and social gathering spots over purely shopping-oriented businesses, especially as people buy more things online. For instance, The Shoppes at Carlsbad, in early 2017, will be debuting the latest local location of Dave & Buster’s, which emphasizes games and events in addition to food.

With limited retail space in the region, and land availabilities scarce in high-demand markets, retail center renovation has been in full swing throughout San Diego County for the past six years.

Current big projects include Westfield Corp.’s $585 million overhaul of Westfield UTC (it completed a $120 million renovation in 2012); and an upcoming $230 million expansion next door at Costa Verde Center, by Regency Centers. Donahue Schriber Realty Group is in the midst of a three-phase, $50 million renovation of its Del Mar Highlands Town Center in Carmel Valley, after completing a $20 million overhaul in 2011.

Multimillion-dollar transformations were also completed in the past five years at Flower Hill Promenade in Del Mar, by owner Protea Properties LLC; and at Fashion Valley mall in Mission Valley, by Simon Property Group Inc. During that period, Westfield overhauled its malls in Escondido, National City, El Cajon and Horton Plaza, and the downtown San Diego venue has more renovations in the works.

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Cohn Restaurant Group has opened a new energy-efficient, floating event space called Harbor Float, docked near its Coasterra restaurant at Harbor Island. Photo courtesy of Cohn Restaurant Group

Save Room for Donuts and Ice Cream: Just what most people need to hear, with holiday-related food gorging now in full gear: San Diego County could soon have a lot more places to buy donuts, ice cream, burgers and milkshakes.

Representatives of Dunkin’ Donuts, Dairy Queen and Shake Shack have all recently said publicly that their respective companies plan big local expansion pushes in coming years, primarily through franchise arrangements.

New York-based Shake Shack, also well known for its cheeseburgers, plans to open next fall at the Westfield UTC mall in San Diego. Local franchisee Burton Restaurants was planning to open a new Dunkin’ Donuts on East Plaza Boulevard in National City in early December, and reportedly had leases signed for four more local venues in San Diego and El Cajon, possibly opening next year.

And an executive of Minneapolis-headquartered Dairy Queen recently told the San Diego Union-Tribune that the ice cream purveyor was planning to nearly double its current 12 local stores over the next five years.

Before fans of these chains get too excited, it’s wise to remember that major expansions can’t happen until franchise agreements are in place, and those franchisees can find specific locations at feasible rental rates. Many franchise-based companies have found it tough to expand locally, at a time when rents are steadily rising and good retail space remains in short supply.

Massachusetts-based Dunkin’ Donuts, for instance, has said on multiple occasions that it planned a significant boost in local eateries, but has opened just two new nonmilitary venues during the past five years — one at the downtown San Diego Embassy Suites hotel, and another on Main Street in Ramona. Otherwise, its local presence has been limited for several years to three military locations — one each at Camp Pendleton, MCAS Miramar and the Navy Medical Center near Balboa Park.

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Badiee Development recently broke ground on an industrial project called Carlsbad Victory Park. Rendering courtesy of Badiee Development Inc.

More News From Carlsbad: Those strolling the promenade at Carlsbad State Beach have likely noticed some commercial construction activity along the busy nearby stretch of Carlsbad Boulevard in the Village neighborhood. The $5 million project underway at 3040 Carlsbad Blvd. — set for a February opening — is Park 101, a multilevel plaza that will have a restaurant and lounge along with a viewing deck, spanning a total of 8,000 square feet.

Developers Peter Cich, Doug Sondomowicz and Rob McShea are spearheading the project, which will include a market selling sandwiches, juices, espresso, ice cream and other items to go; and an indoor/outdoor venue called Garden Pub, with 32 local beer taps and regional wine offerings. The project also includes Park 101 Barbecue, serving ribs and other meat items, and Tamarack View Deck, featuring a rooftop lounge with fire pits and seating areas.

Park 101 is a few doors down from a fenced-off, cleared-away parcel where other developers have a 104-room Marriott hotel in the works. The three-story hotel will replace The Armenian Café, which closed earlier this year after 27 years at 3126 Carlsbad Blvd., along with the vintage-1960s, 28-room Surf Motel that was situated at 3136 Carlsbad Blvd., along with a single-family home.

Elsewhere in Carlsbad, La Jolla-based developer Badiee Development Inc. recently broke ground on the previously announced, $10 million Carlsbad Victory Park at 3248 Lionshead Ave. A summer 2017 completion is expected on the 55,573-square-foot industrial project, led by general contractor TFW Construction and designed by Smith Consulting Architects.

Carlsbad Victory Park is the first of six industrial projects, totaling $90 million, in Badiee’s North County development pipeline.

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Float By For Next Party: San Diego’s Cohn Restaurant Group recently opened Harbor Float, a new floating event space which operators said is the first of its kind on the West Coast. Docked near the company’s Coasterra restaurant at Harbor Island, the 6,000-square-foot, pre-constructed space generates 90 percent of its own power through a state-of-the-art photovoltaic solar glass panel system.

Send commercial real estate and development news of general local interest to Lou Hirsh via email at lhirsh@sdbj.com.

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