Century, the dominant player in the Bay Area market, will build a 20-screen theater atop a new parking garage that is part of the redevelopment. Wattson Breevast SVP Greg Wattson tells GlobeSt.com that Century will sign a 20-year ground lease for the air rights above the parking garage.
Wattson Breevast is a 50-50 joint venture of Wattson Group and Breevast BV, a Dutch company. Including the cost to purchase the property in 1999, the total development cost of the Shops at Tanforan is $125 million. Wattson says the project is being financed by Frankfurt, Germany-based Eurohypo, which is providing $94.7 million of the total cost. Breevast is providing the equity component.
With building permits signed, stamped and ready to be picked up, the goal is to open the theater and 330,000 sf of shop space by the fall of 2005. When combined with existing anchors Sears, JCPenney and Target, which will remain open during the transformation, the new Shops at Tanforan will have more than one million sf of shopping, dining and entertainment venues located five minutes from the San Francisco Airport on El Camino Real at I-380.
General Growth Properties has the leasing assignment. With the name of some 50 signed tenants revealed last week, Wattson says the development's new shop space is more than 50% leased. If leases that are fully negotiated and out for signature are included, that number jumps to 60%, and leases currently under negotiation would fill another 20% of the space.
The competition is Hillsdale Shopping Center, a family-owned property 10 miles to the south, and Serramonte, a center located several miles north of the project that sold last year to London-based Capital and Counties USA. Wattson says he's confident they will pale in comparison to Shops at Tanforan.
"What sets us apart is that we are more conveniently located to the I-380, I-280 and Highway 101 and will have a (Bay Area Rapid Transit) station built right into the parking lot, so our ability to attract commuters will be better," he says. "As well, we will have a cinema, which the other two shopping centers don't have, and we will have many more restaurants."
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