Execs Discuss Industry Changes

PALM SPRINGS, CA-Rising costs in this state are not only impacting landlords from a construction perspective, but they are also hitting developers by constraining their customers’ wallets, speakers said at the International Council of Shopping Centers’ Western Division Conference. “It’s hard to live here; it’s hard to work here,” says David Contis, EVP and COO at the Santa Monica, CA-based Macerich Co. “The quality of life is dramatically worse, and we have to address that.”

Not only that, but Contis predicts that the cost of development will continue to rise as well. “I think liquidity for development projects will get more and more expensive,” he says.

In a later session, professionals stressed changes in the industry and discussed how traditional shopping centers will no longer be the norm due to the proliferation of mixed-use centers and “hybrid” developments that have varying retail uses. “Everything is blending,” says Richard Kuhle, president of Phoenix-based Vestar Development Co. “But what we’re trying to do is provide a platform for retailers to have the highest sales that they can.”