PALM SPRINGS: Own a piece of the ‘Hard Rock’

Own a piece of “The Rock.”

That was the Wednesday morning wake-up call Andre Carpiac, majority owner of Hard Rock Hotel Palm Springs, put out to investors to raise $1.5 million — or more — through a crowdfunding offer by the Beverly Hills-based real estate tech company, RealtyMogul.

In a rarity, if not a first, in the hotel business, investors can fork over anywhere from $10,000 to $200,000 to buy VIP status and a sliver of the 163-room resort property in downtown Palm Springs.

Beyond the welcome bottle of champagne and cheese plate, VIP “crowdies” have been told to expect room upgrades, use of the owner’s pool deck cabana — when available — a 25 percent discount on room rates and $50 per year in food and beverage credits.

Accredited investors will also get a crack at shared income from quarterly rental payments and any appreciation of the hotel when it is sold, the RealtyMogul.com offering says.

Carpiac, of Kittridge Hotels Resorts, called the equity owner investment opportunity in the Hard Rock-linked affiliate, WealthForge LLC, a “winning formula” for everyone. It is the first major hotel in the United States to be crowd-funded in an online marketplace, and he believes it won’t be the last.

By noon Wednesday, RealtyMogul executive chair Jay Samit said $500,000 was raised in the online marketplace for the crowdfunding investment.

“In the last 24 hours, it’s been off the hook,” Carpiac said Thursday.

CROWD FINANCING

Crowdfunding, a financial services industry buzzword, is catching on in the online world for commercial real estate investment. It differs from a Real Estate Investment Trust in that the crowdfunding portfolio is typically smaller and its properties or investment pool is well-defined.

REITs generally involve large entities. Crowdfunding allows a large pool of investors — the crowd — to pool money together to buy shares of real property like apartment buildings or retail centers. The fundraising is typically orchestrated by means of a Web platform.

Before it branched into the real estate realm, crowdfunding has been used to finance video games, motion picture promotion, disaster relief, political campaigns, citizen journalism, the British rock group Marillion’s tour of the U.S., start-up companies and even the construction of the platform for the Statue of Liberty.

Hard Rock’s solicitation falls into the category of equity crowdfunding for perks.

IN THE POOL

“The more investors we attract, the more we invest in the hotel,” Carpiac said. “This is an ideal for the die-hard investors who have to travel a lot, have discretionary income and want to own a piece of Hard Rock Hotel.”

Carpiac said a portion of the money raised — it could be more than $1.5 million — will be spent on big-name entertainment for the GoldenVoice venue, a nightclub, spa and salon expansion and a signature restaurant. Six months into the grand opening, he said, Hard Rock Hotel has “blown through all of its goals.”

“We’ve been spectacularly successful,” he said. “This is not a move to shore up finances. We think it’s a great concept: It’s cutting-edge.”

There are risks: Private placement investments are not bank deposits and are not guaranteed, and may lose value.

OUTSIDE THE BOX

Bruce Baltin, senior vice president of PKF Consulting in Los Angeles, said he isn’t aware of any other hotel in the U.S. that has ventured into crowdfunding as a real estate securities investment tool.

“That doesn’t mean it hasn’t been tried,” he said.

Baltin said he wasn’t surprised to hear crowd-funded investment is moving into the hotel scene.

“Crowd funding is growing as a means of raising capital and hotel REITS have been around for a long time,” he said. “People do buy stock in companies that own hotels.”

Alan Reay, a California-based hospitality industry analyst, said this is the first he’s heard of a hotel business soliciting investors through crowdfunding.

If the call is not being made with intent to use the funds as a loan and the investors become minority partners, Reay said the solicitation makes sense.

INVESTOR REALM

Carpiac is no stranger to the real estate investment world.

The 1999 UCLA graduate with a degree in business and economics has, through Pacifica Capital Group, been involved in acquisitions, dispositions, leasing and asset management of Southern California commercial real estate.

What Carpiac likes about the RealtyMogul-managed offering is the company acts as the middleman, vetting investors. Equity crowdfunding can be tricky. At the same time, Carpiac said it’s an equity investment in a hard piece of real estate asset.

“But if you buy stock in a public company, or you’re investing with a venture capital firm or you are buying a piece of real estate, there’s always risk in any investment class,” he said.

“It’s all very regulated, and the company is extremely credible,” he said. It has a substantial data base already, with over 8,000 investors.

CROWDFUNDING VETERAN

Samit, a UCLA grad, said the Beverly Hills-based RealtyMogul venture in the past year has crowd-funded more than $100 million in property value in multifamily housing, public storage and shopping centers.

Hospitality falls into that category, he said, and Hard Rock Hotel Palm Springs was selected because of its iconic, recognizable brand. “It’s a great property to show what can be done with crowdfunding for hotels,” he said.

Though the investment goal is $1.5 million, Samit said the bar can be raised a bit higher. Once the investor pool is identified, computer software divides the equity share. The investment is not as simple as rolling a sizeable IRS return into the crowd-funded kitty.

One has to be accredited to jump into the pool.

Accredited investors are defined by the Securities and Exchange Commission as having $200,000 of annual income per individual — $300,000 per couple — with the expectation of that continuing, or, a net worth of more than $1 million excluding the value of a primary residence.

There are 9 million accredited investors in the United States.

The Hard Rock opened on Oct. 4, 2013. Though the property is flagged as a Hard Rock hotel, it is not managed or operated by Hard Rock International.

Contact Debra Gruszecki at 951-368-9423 or dgruszecki@pe.com

EQUITY CROWDFUNDING

 

Investors pool their money, usually over the Internet, to provide financing in the form of equity.

The least developed form involves selling small amounts of equity to a large number of investors.

RISKS

Make sure the opportunity has been filed with appropriate regulatory agencies, like the Securities and Exchange Commission. Securities should not be sold unless the sale is accompanied or preceded by a prospectus.

SOURCE: WIKIPEDIA

Article source: http://www.pe.com/business/business-headlines/20140417-palm-springs-own-a-piece-of-the-hard-rock.ece

PALM SPRINGS: Own a piece of the ‘Hard Rock’

Own a piece of “The Rock.”

That was the Wednesday morning wake-up call Andre Carpiac, majority owner of Hard Rock Hotel Palm Springs, put out to investors to raise $1.5 million — or more — through a crowdfunding offer by the Beverly Hills-based real estate tech company, RealtyMogul.

In a rarity, if not a first, in the hotel business, investors can fork over anywhere from $10,000 to $200,000 to buy VIP status and a sliver of the 163-room resort property in downtown Palm Springs.

Beyond the welcome bottle of champagne and cheese plate, VIP “crowdies” have been told to expect room upgrades, use of the owner’s pool deck cabana — when available — a 25 percent discount on room rates and $50 per year in food and beverage credits.

Accredited investors will also get a crack at shared income from quarterly rental payments and any appreciation of the hotel when it is sold, the RealtyMogul.com offering says.

Carpiac, of Kittridge Hotels Resorts, called the equity owner investment opportunity in the Hard Rock-linked affiliate, WealthForge LLC, a “winning formula” for everyone. It is the first major hotel in the United States to be crowd-funded in an online marketplace, and he believes it won’t be the last.

By noon Wednesday, RealtyMogul executive chair Jay Samit said $500,000 was raised in the online marketplace for the crowdfunding investment.

“In the last 24 hours, it’s been off the hook,” Carpiac said Thursday.

CROWD FINANCING

Crowdfunding, a financial services industry buzzword, is catching on in the online world for commercial real estate investment. It differs from a Real Estate Investment Trust in that the crowdfunding portfolio is typically smaller and its properties or investment pool is well-defined.

REITs generally involve large entities. Crowdfunding allows a large pool of investors — the crowd — to pool money together to buy shares of real property like apartment buildings or retail centers. The fundraising is typically orchestrated by means of a Web platform.

Before it branched into the real estate realm, crowdfunding has been used to finance video games, motion picture promotion, disaster relief, political campaigns, citizen journalism, the British rock group Marillion’s tour of the U.S., start-up companies and even the construction of the platform for the Statue of Liberty.

Hard Rock’s solicitation falls into the category of equity crowdfunding for perks.

IN THE POOL

“The more investors we attract, the more we invest in the hotel,” Carpiac said. “This is an ideal for the die-hard investors who have to travel a lot, have discretionary income and want to own a piece of Hard Rock Hotel.”

Carpiac said a portion of the money raised — it could be more than $1.5 million — will be spent on big-name entertainment for the GoldenVoice venue, a nightclub, spa and salon expansion and a signature restaurant. Six months into the grand opening, he said, Hard Rock Hotel has “blown through all of its goals.”

“We’ve been spectacularly successful,” he said. “This is not a move to shore up finances. We think it’s a great concept: It’s cutting-edge.”

There are risks: Private placement investments are not bank deposits and are not guaranteed, and may lose value.

OUTSIDE THE BOX

Bruce Baltin, senior vice president of PKF Consulting in Los Angeles, said he isn’t aware of any other hotel in the U.S. that has ventured into crowdfunding as a real estate securities investment tool.

“That doesn’t mean it hasn’t been tried,” he said.

Baltin said he wasn’t surprised to hear crowd-funded investment is moving into the hotel scene.

“Crowd funding is growing as a means of raising capital and hotel REITS have been around for a long time,” he said. “People do buy stock in companies that own hotels.”

Alan Reay, a California-based hospitality industry analyst, said this is the first he’s heard of a hotel business soliciting investors through crowdfunding.

If the call is not being made with intent to use the funds as a loan and the investors become minority partners, Reay said the solicitation makes sense.

INVESTOR REALM

Carpiac is no stranger to the real estate investment world.

The 1999 UCLA graduate with a degree in business and economics has, through Pacifica Capital Group, been involved in acquisitions, dispositions, leasing and asset management of Southern California commercial real estate.

What Carpiac likes about the RealtyMogul-managed offering is the company acts as the middleman, vetting investors. Equity crowdfunding can be tricky. At the same time, Carpiac said it’s an equity investment in a hard piece of real estate asset.

“But if you buy stock in a public company, or you’re investing with a venture capital firm or you are buying a piece of real estate, there’s always risk in any investment class,” he said.

“It’s all very regulated, and the company is extremely credible,” he said. It has a substantial data base already, with over 8,000 investors.

CROWDFUNDING VETERAN

Samit, a UCLA grad, said the Beverly Hills-based RealtyMogul venture in the past year has crowd-funded more than $100 million in property value in multifamily housing, public storage and shopping centers.

Hospitality falls into that category, he said, and Hard Rock Hotel Palm Springs was selected because of its iconic, recognizable brand. “It’s a great property to show what can be done with crowdfunding for hotels,” he said.

Though the investment goal is $1.5 million, Samit said the bar can be raised a bit higher. Once the investor pool is identified, computer software divides the equity share. The investment is not as simple as rolling a sizeable IRS return into the crowd-funded kitty.

One has to be accredited to jump into the pool.

Accredited investors are defined by the Securities and Exchange Commission as having $200,000 of annual income per individual — $300,000 per couple — with the expectation of that continuing, or, a net worth of more than $1 million excluding the value of a primary residence.

There are 9 million accredited investors in the United States.

The Hard Rock opened on Oct. 4, 2013. Though the property is flagged as a Hard Rock hotel, it is not managed or operated by Hard Rock International.

Contact Debra Gruszecki at 951-368-9423 or dgruszecki@pe.com

EQUITY CROWDFUNDING

 

Investors pool their money, usually over the Internet, to provide financing in the form of equity.

The least developed form involves selling small amounts of equity to a large number of investors.

RISKS

Make sure the opportunity has been filed with appropriate regulatory agencies, like the Securities and Exchange Commission. Securities should not be sold unless the sale is accompanied or preceded by a prospectus.

SOURCE: WIKIPEDIA

Article source: http://www.pe.com/business/business-headlines/20140417-palm-springs-own-a-piece-of-the-hard-rock.ece

CABAZON: Retail blooms in Desert Hills Premium Outlets

Tianyuan Liu looked content as she took a break outside MaxStudio at Desert Hills Premium Outlets. Four jam-packed shopping bags sat at her feet, one stuffed with several pairs of glow-in-the-dark Nike tennis shoes.

Liu traveled to Los Angeles from Beijing to tour a prospective university where she will study urban planning.

With a few hours to spare before her return flight to China, Liu explored the shops.

“I’m a little tired,” she said, but affirmed that the advice to check out the shops before heading home was spot-on. “I found some really cool things at a reasonable price.”

Desert Hills Premium Outlets, a venue along I-10 in Cabazon that will soon trumpet 180 stores, is about to complete a $100 million expansion from shabby chic to desert luxe.

The Simon Property Group which owns or has an interest in more than 325 retail properties in North America, Asia and Europe and has $1.1 billion in redevelopment and expansion projects in the works at 25 properties in the U.S., Asia and Mexico counts the Desert Hills expansion as one of its finest finishes.

“This is our Woodbury Common of the West Coast,” said Coleen Conklin, senior vice president of marketing for the premium outlet division of Simon Property Group in Indianapolis, comparing the desert site to its center in Central Valley, N.Y., one of the most successful in the nation.

The banner greeting newcomers as they head from the newly built parking garage to a lush, brick-paved courtyard with a clutch of desert-toned stores warns: “You’re Gonna Need a Bigger Closet.”

EXPANDING OLD AND NEW

The expansion, which grew the center from 130 to 180 stores, attracted high-end newcomers such as Ted Baker London, Helmut Lang, Alexander McQueen, Fendi, Valentino and Calypso.

“The heft of stores we’re bringing to this property is pretty impressive,” she said. “Alexander McQueen, Belstaff and Helmut Lang are brands that do not have a single outlet store yet in the U.S., so it’s very exciting.”

Expansions of the existing stores are equally dazzling: Burberry is adding its “gold” line. Guess Factory Store is moving to a bigger site. And Prada, Coach and Georgio Armani are all adding space.

For Sarar, a European men’s and women’s fashion boutique, the Desert Hills store is a West Coast first.

“This center used to look like the Premium Outlets in Orlando,” said Anil Ocal, project manager for Sarar. “Now, Desert Hills is catching up with Woodbury Common, the highest grossing store in the United States.”

What brought Sarar to Desert Hills before any other malls on the West Coast was its reputation for attracting tourists and its international draw, he said.

If Sarar is successful in the Cabazon outlet center, Ocal said three more California stores will open in the Los Angeles and San Francisco markets.

BIENVENIDO, BIENVENUE, WELCOME

Simon’s Cabazon center and its neighbor Cabazon Outlets, a line-up of 20 stores directly east of Desert Hills operated by Craig Realty Group of Newport Beach, attracts I-10 drive-by tourists, day-trippers from Greater Palm Springs, Orange County, the Los Angeles Basin, Arizona and Nevada.

Tour buses, SUVs and mini-buses pull up at the curb regularly, with the PA system welcoming shoppers in foreign languages that span the globe.

The nearby Morongo Casino Resort Spa and the region’s hotels offer shuttles to and from their hotels and casinos.

Simon offers tour packages that take die-hard shoppers from one Simon property to another.

“Asia is a hugely important market,” said Conklin, and tour groups from China have increased by nearly 50 percent in the past year.

The property also draws shoppers from Canada, Mexico and a range of countries in the Pacific Rim.

Over Thanksgiving, Ariel Carranza of Argentina and two travelers from Mexico City visited Desert Hills after spending a day at Disneyland.

Carranza, resting his arms from shopping bags filled with clothes from Diesel and Guess Factory Store, said the shopping trip was as awe-inspiring as Cars Land in Disney California Adventure.

It’s “buenisimo,” he said.

Conklin said many international visitors, such as Carranza, buy new suitcases in which to haul away their purchases.

“This is party central,” said Erin Zavislak, a Kate Spade New York sales associate.

There’s been a “noticeable difference” in foot traffic, an “upbeat” vibe as the new stores are starting to open and tourists catch glimpses of mannequins in their new digs, Zavislak said.

NEW LOOK, NEW JOBS

By Conklin’s estimates, the expansion will create 400 to 500 new part-time and full-time jobs.

Last week, the Job Line rattled off names, numbers and instructions for prospects in 45 stores.

“We just hired 50 part-time sales associates,” said Jennifer Miranda, general manager at Kate Spade.

Christopher Garcia, a manager at Guess, expects the list of workers to grow as well.

There’s been some crossover, too.

Workers have been switching nametags for better pay, a promotion or chance to pad their work week with more hours.

“Managers have been working hard to make sure our stores have a really good environment so our valued employees don’t jump ship,” Miranda said.

IMPROVED ECONOMY MEANS GROWTH

The expansion of Desert Hills Premium Outlets is coming at an optimum time: the economy is improving.

The National Retail Federation in February forecast a 4.1 percent increase in retail sales for 2014.

The expansion follows one of the worst winters in decades.

Desert Hills, which generated $3.1 million in sales tax revenue in 2013 –

$13 million over five years – was among several Simon outlets earmarked for expansion in 2012.

In August 2012, Desert Hills was considered a high performer with sales approaching $1,000 per square foot, compared with the average $562 per square foot reported by Simon.

Les Morris, a spokesman for Simon Property Group, said redevelopment has concentrated on premium outlets – and better luxury brands – because the demand is there.

“Desert Hills is one of our most productive centers in the Premium Outlets’ portfolio,” Conklin said. “It generates more than $1,300 a square foot in sales.”

New York’s Woodbury Common Premium Outlets is in the midst of a

$170 million expansion, giving the 220-store property an architectural facelift and expanding the food court with the aim of improving the shopping experience for international guests.

This year, Morris said Simon will finish new and redeveloped outlets in Charlotte, N.C., the Twin Cities area of Minnesota, and in Montreal.

By 2015, a second premium outlet will open in Vancouver, British Columbia.

“There’s been great demand for value shopping,” Morris said. “And it starts at the consumer level and at the tenant level.

“High-end retailers are going into premium outlet centers because … the customer is there,” he said.

In Desert Hills’ case, Morris said the expansion was a way to make a terrific asset even stronger.

“We have built-in brand equity there,” he said. “The customer knows Desert Hills and she wants to be there. Now, we are enhancing that.”

That concept is not lost on the Traxler family of Kalamazoo, Mich.

After visiting a relative in Huntington Beach, Wendi Traxler and her family headed to Palm Springs, stopping at Desert Hills.

Traxler was disappointed to see many of the stores won’t make their debut until April 24-27.

As one teenaged daughter stood by swinging a PacSun bag around her wrist, Traxler said, “Seeing this, I wish we’d have booked our vacation later.”

Contact the writer at 951-368-9423 or dgruszecki@pe.com.

Key new stores

Alexander McQueen – first in the U.S.

Belstaff – first in the U.S.

Helmut Lang – first in the U.S.

Sarar – first on the West Coast

CH Carolina Herrera

La Perla

Wolford

New outlet stores on the April opening list

Alice + Olivia

Anne Fontaine

Asics

Bally

Calypso St. Barth au Marché

Canali

Catimini

Disney Store Outlet

Fendi

Frette

G-Star Raw

Gucci Kids

Hurley

John Varvatos

Journeys

Lladro

Loft Outlet

Max Mara

Porsche Design

Prada

Robert Graham

Steve Madden

Swarovski

Ted Baker London

The Body Shop Outlet

Theory Men

Wetzel’s Pretzels

New outlet stores set to open by late 2014

American Eagle

Blaze Pizza

Maje

Marc Jacobs

Moncler

Rag Bone

Sandro

Valentino

Existing stores that relocated to newer digs

AllSaints Spitalfields

Bottega Venetta

Burberry

Carter’s

Coach

Cole Haan

Dolce Gabbana

Elie Tahari

Giorgio Armani

Guess Factory Store

Loro Piana

Tod’s

True Religion Brand Jeans

White House/Black Market

Source: Simon Property Group spokesman

Desert Hills at a glance

Desert Hills Premium Outlets, one of the most productive centers in the premium outlet portfolio of Simon Property Group of Indianapolis, opened in 1990.

Past expansions: 1995, 1997, 2002

Newest expansion: 2014, $100 million

New outlet stores: Center gains 50 stores – taking it to 180 – and giving it bragging rights for bagging the first Alexander McQueen, Belstaff and Helmut Lang outlets in the U.S.

New indoor parking garage: Includes 1,100 parking spots, a barrier to protect from the desert winds and a lighting system that simulates an airport runway take-off for drivers departing the mall.

Better ambiance: Pedestrian-friendly walkways and escalators, palm tree plantings, sculptures and landscaping details that capture the beauty of the desert, azure skies and mountain backdrop.

Simon portfolio

Simon Property Group centers in the Southern California include:

Brea Mall, Brea

Camarillo Premium Outlets, Camarillo

Carlsbad Premium Outlets, Carlsbad

Del Amo Fashion Center, Torrance

Fashion Valley, San Diego

Ontario Mills, Ontario

Las Americas Premium Outlets, San Diego

The Outlets at Orange, Orange

The Shops at Mission Viejo, Mission Viejo

The Shops at Montebello, Montebello

Westminster Mall, Westminster

Source: simon.com

Five new things to know

1. There are nearly 50 new designer and name-brand outlet stores including Alexander McQueen – the brand’s first North American outlet.

2. The parking deck is as long as three football fields and as wide as one football field.

3. An escalator has been added to quickly deliver guests from the center’s West Village to East Village.

4. There’s a new information booth in the center’s East Village, offering a center map, information and coupon books for $5. Flash your AAA card, AARP card or a host of others and this nifty booklet is free.

5. Visitors will notice wider walkways – the equivalent of 76 miles of residential sidewalks.

Source: Simon Property Group

INSIDE: Lake Elsinore outlets’ new strategy embraces increased visibility | PAGE

Article source: http://www.pe.com/local-news/local-news-headlines/20140419-cabazon-retail-blooms-in-desert-hills-premium-outlets.ece

CABAZON: Retail blooms in Desert Hills Premium Outlets

Tianyuan Liu looked content as she took a break outside MaxStudio at Desert Hills Premium Outlets. Four jam-packed shopping bags sat at her feet, one stuffed with several pairs of glow-in-the-dark Nike tennis shoes.

Liu traveled to Los Angeles from Beijing to tour a prospective university where she will study urban planning.

With a few hours to spare before her return flight to China, Liu explored the shops.

“I’m a little tired,” she said, but affirmed that the advice to check out the shops before heading home was spot-on. “I found some really cool things at a reasonable price.”

Desert Hills Premium Outlets, a venue along I-10 in Cabazon that will soon trumpet 180 stores, is about to complete a $100 million expansion from shabby chic to desert luxe.

The Simon Property Group which owns or has an interest in more than 325 retail properties in North America, Asia and Europe and has $1.1 billion in redevelopment and expansion projects in the works at 25 properties in the U.S., Asia and Mexico counts the Desert Hills expansion as one of its finest finishes.

“This is our Woodbury Common of the West Coast,” said Coleen Conklin, senior vice president of marketing for the premium outlet division of Simon Property Group in Indianapolis, comparing the desert site to its center in Central Valley, N.Y., one of the most successful in the nation.

The banner greeting newcomers as they head from the newly built parking garage to a lush, brick-paved courtyard with a clutch of desert-toned stores warns: “You’re Gonna Need a Bigger Closet.”

EXPANDING OLD AND NEW

The expansion, which grew the center from 130 to 180 stores, attracted high-end newcomers such as Ted Baker London, Helmut Lang, Alexander McQueen, Fendi, Valentino and Calypso.

“The heft of stores we’re bringing to this property is pretty impressive,” she said. “Alexander McQueen, Belstaff and Helmut Lang are brands that do not have a single outlet store yet in the U.S., so it’s very exciting.”

Expansions of the existing stores are equally dazzling: Burberry is adding its “gold” line. Guess Factory Store is moving to a bigger site. And Prada, Coach and Georgio Armani are all adding space.

For Sarar, a European men’s and women’s fashion boutique, the Desert Hills store is a West Coast first.

“This center used to look like the Premium Outlets in Orlando,” said Anil Ocal, project manager for Sarar. “Now, Desert Hills is catching up with Woodbury Common, the highest grossing store in the United States.”

What brought Sarar to Desert Hills before any other malls on the West Coast was its reputation for attracting tourists and its international draw, he said.

If Sarar is successful in the Cabazon outlet center, Ocal said three more California stores will open in the Los Angeles and San Francisco markets.

BIENVENIDO, BIENVENUE, WELCOME

Simon’s Cabazon center and its neighbor Cabazon Outlets, a line-up of 20 stores directly east of Desert Hills operated by Craig Realty Group of Newport Beach, attracts I-10 drive-by tourists, day-trippers from Greater Palm Springs, Orange County, the Los Angeles Basin, Arizona and Nevada.

Tour buses, SUVs and mini-buses pull up at the curb regularly, with the PA system welcoming shoppers in foreign languages that span the globe.

The nearby Morongo Casino Resort Spa and the region’s hotels offer shuttles to and from their hotels and casinos.

Simon offers tour packages that take die-hard shoppers from one Simon property to another.

“Asia is a hugely important market,” said Conklin, and tour groups from China have increased by nearly 50 percent in the past year.

The property also draws shoppers from Canada, Mexico and a range of countries in the Pacific Rim.

Over Thanksgiving, Ariel Carranza of Argentina and two travelers from Mexico City visited Desert Hills after spending a day at Disneyland.

Carranza, resting his arms from shopping bags filled with clothes from Diesel and Guess Factory Store, said the shopping trip was as awe-inspiring as Cars Land in Disney California Adventure.

It’s “buenisimo,” he said.

Conklin said many international visitors, such as Carranza, buy new suitcases in which to haul away their purchases.

“This is party central,” said Erin Zavislak, a Kate Spade New York sales associate.

There’s been a “noticeable difference” in foot traffic, an “upbeat” vibe as the new stores are starting to open and tourists catch glimpses of mannequins in their new digs, Zavislak said.

NEW LOOK, NEW JOBS

By Conklin’s estimates, the expansion will create 400 to 500 new part-time and full-time jobs.

Last week, the Job Line rattled off names, numbers and instructions for prospects in 45 stores.

“We just hired 50 part-time sales associates,” said Jennifer Miranda, general manager at Kate Spade.

Christopher Garcia, a manager at Guess, expects the list of workers to grow as well.

There’s been some crossover, too.

Workers have been switching nametags for better pay, a promotion or chance to pad their work week with more hours.

“Managers have been working hard to make sure our stores have a really good environment so our valued employees don’t jump ship,” Miranda said.

IMPROVED ECONOMY MEANS GROWTH

The expansion of Desert Hills Premium Outlets is coming at an optimum time: the economy is improving.

The National Retail Federation in February forecast a 4.1 percent increase in retail sales for 2014.

The expansion follows one of the worst winters in decades.

Desert Hills, which generated $3.1 million in sales tax revenue in 2013 –

$13 million over five years – was among several Simon outlets earmarked for expansion in 2012.

In August 2012, Desert Hills was considered a high performer with sales approaching $1,000 per square foot, compared with the average $562 per square foot reported by Simon.

Les Morris, a spokesman for Simon Property Group, said redevelopment has concentrated on premium outlets – and better luxury brands – because the demand is there.

“Desert Hills is one of our most productive centers in the Premium Outlets’ portfolio,” Conklin said. “It generates more than $1,300 a square foot in sales.”

New York’s Woodbury Common Premium Outlets is in the midst of a

$170 million expansion, giving the 220-store property an architectural facelift and expanding the food court with the aim of improving the shopping experience for international guests.

This year, Morris said Simon will finish new and redeveloped outlets in Charlotte, N.C., the Twin Cities area of Minnesota, and in Montreal.

By 2015, a second premium outlet will open in Vancouver, British Columbia.

“There’s been great demand for value shopping,” Morris said. “And it starts at the consumer level and at the tenant level.

“High-end retailers are going into premium outlet centers because … the customer is there,” he said.

In Desert Hills’ case, Morris said the expansion was a way to make a terrific asset even stronger.

“We have built-in brand equity there,” he said. “The customer knows Desert Hills and she wants to be there. Now, we are enhancing that.”

That concept is not lost on the Traxler family of Kalamazoo, Mich.

After visiting a relative in Huntington Beach, Wendi Traxler and her family headed to Palm Springs, stopping at Desert Hills.

Traxler was disappointed to see many of the stores won’t make their debut until April 24-27.

As one teenaged daughter stood by swinging a PacSun bag around her wrist, Traxler said, “Seeing this, I wish we’d have booked our vacation later.”

Contact the writer at 951-368-9423 or dgruszecki@pe.com.

Key new stores

Alexander McQueen – first in the U.S.

Belstaff – first in the U.S.

Helmut Lang – first in the U.S.

Sarar – first on the West Coast

CH Carolina Herrera

La Perla

Wolford

New outlet stores on the April opening list

Alice + Olivia

Anne Fontaine

Asics

Bally

Calypso St. Barth au Marché

Canali

Catimini

Disney Store Outlet

Fendi

Frette

G-Star Raw

Gucci Kids

Hurley

John Varvatos

Journeys

Lladro

Loft Outlet

Max Mara

Porsche Design

Prada

Robert Graham

Steve Madden

Swarovski

Ted Baker London

The Body Shop Outlet

Theory Men

Wetzel’s Pretzels

New outlet stores set to open by late 2014

American Eagle

Blaze Pizza

Maje

Marc Jacobs

Moncler

Rag Bone

Sandro

Valentino

Existing stores that relocated to newer digs

AllSaints Spitalfields

Bottega Venetta

Burberry

Carter’s

Coach

Cole Haan

Dolce Gabbana

Elie Tahari

Giorgio Armani

Guess Factory Store

Loro Piana

Tod’s

True Religion Brand Jeans

White House/Black Market

Source: Simon Property Group spokesman

Desert Hills at a glance

Desert Hills Premium Outlets, one of the most productive centers in the premium outlet portfolio of Simon Property Group of Indianapolis, opened in 1990.

Past expansions: 1995, 1997, 2002

Newest expansion: 2014, $100 million

New outlet stores: Center gains 50 stores – taking it to 180 – and giving it bragging rights for bagging the first Alexander McQueen, Belstaff and Helmut Lang outlets in the U.S.

New indoor parking garage: Includes 1,100 parking spots, a barrier to protect from the desert winds and a lighting system that simulates an airport runway take-off for drivers departing the mall.

Better ambiance: Pedestrian-friendly walkways and escalators, palm tree plantings, sculptures and landscaping details that capture the beauty of the desert, azure skies and mountain backdrop.

Simon portfolio

Simon Property Group centers in the Southern California include:

Brea Mall, Brea

Camarillo Premium Outlets, Camarillo

Carlsbad Premium Outlets, Carlsbad

Del Amo Fashion Center, Torrance

Fashion Valley, San Diego

Ontario Mills, Ontario

Las Americas Premium Outlets, San Diego

The Outlets at Orange, Orange

The Shops at Mission Viejo, Mission Viejo

The Shops at Montebello, Montebello

Westminster Mall, Westminster

Source: simon.com

Five new things to know

1. There are nearly 50 new designer and name-brand outlet stores including Alexander McQueen – the brand’s first North American outlet.

2. The parking deck is as long as three football fields and as wide as one football field.

3. An escalator has been added to quickly deliver guests from the center’s West Village to East Village.

4. There’s a new information booth in the center’s East Village, offering a center map, information and coupon books for $5. Flash your AAA card, AARP card or a host of others and this nifty booklet is free.

5. Visitors will notice wider walkways – the equivalent of 76 miles of residential sidewalks.

Source: Simon Property Group

INSIDE: Lake Elsinore outlets’ new strategy embraces increased visibility | PAGE

Article source: http://www.pe.com/local-news/local-news-headlines/20140419-cabazon-retail-blooms-in-desert-hills-premium-outlets.ece

Are we building too many houses?


New homes for sale at a development in Dublin, Calif.

Contracts for newly built homes dipped slightly last month, and strong October numbers were revised even higher.

Article source: http://www.cnbc.com/id/101345432

Are we building too many houses?


New homes for sale at a development in Dublin, Calif.

Contracts for newly built homes dipped slightly last month, and strong October numbers were revised even higher.

Article source: http://www.cnbc.com/id/101345432

Real estate’s least sexy sector is red hot

Amazon.com‘s latest move—to anticipate what you want to buy and start shipping it before you even buy it—could be a big boon to a sector that is already seeing huge gains. Industrial warehouse space, once a dud in real estate, is now closing in on prom queen status, as more retail goes online and as the housing market recovers.

“Amazon is at the forefront of a larger trend that has seen demand for well-located logistics centers, very close to major urban centers increase sharply,” said Sam Chandan of Chandan Economics. “It’s some of the best performing space that we see in commercial real estate right now, across all property types.”

Warehouses are the strongest prospect for both investment and development in 2014, according to the latest PWC Investor Survey. Two thirds of respondents deemed warehouses a “buy.”

“That’s the highest of all the real estate food groups,” said PWC partner Mitch Roschelle. “The online retailers have struggled to figure out how to get the goods closer and closer and closer to where the people live.”

As Amazon starts moving its products closer to its customers, others will likely follow suit, meaning more need for those smaller distribution centers that are closer to major metropolitan areas.

“They [Amazon] are probably the most creative and forward-looking people in this space, and seeing this type of thing doesn’t surprise me,” said Jack Cuneo, CEO of Chambers Street Properties. “It’s a great model, so you’re going to see more people emulating what they do and more need on their part for space.”

Chambers Street, a real estate investment trust based in Princeton, N.J., owns six Amazon fulfillment centers, three in the United States and three overseas. While these are larger properties, Cuneo says a system like Amazon is proposing might move the retailer out of some of the larger facilities and into smaller ones.

(Read more: Construction up, but are we building too many houses?)

Article source: http://www.cnbc.com/id/101354474

Real estate’s least sexy sector is red hot

Amazon.com‘s latest move—to anticipate what you want to buy and start shipping it before you even buy it—could be a big boon to a sector that is already seeing huge gains. Industrial warehouse space, once a dud in real estate, is now closing in on prom queen status, as more retail goes online and as the housing market recovers.

“Amazon is at the forefront of a larger trend that has seen demand for well-located logistics centers, very close to major urban centers increase sharply,” said Sam Chandan of Chandan Economics. “It’s some of the best performing space that we see in commercial real estate right now, across all property types.”

Warehouses are the strongest prospect for both investment and development in 2014, according to the latest PWC Investor Survey. Two thirds of respondents deemed warehouses a “buy.”

“That’s the highest of all the real estate food groups,” said PWC partner Mitch Roschelle. “The online retailers have struggled to figure out how to get the goods closer and closer and closer to where the people live.”

As Amazon starts moving its products closer to its customers, others will likely follow suit, meaning more need for those smaller distribution centers that are closer to major metropolitan areas.

“They [Amazon] are probably the most creative and forward-looking people in this space, and seeing this type of thing doesn’t surprise me,” said Jack Cuneo, CEO of Chambers Street Properties. “It’s a great model, so you’re going to see more people emulating what they do and more need on their part for space.”

Chambers Street, a real estate investment trust based in Princeton, N.J., owns six Amazon fulfillment centers, three in the United States and three overseas. While these are larger properties, Cuneo says a system like Amazon is proposing might move the retailer out of some of the larger facilities and into smaller ones.

(Read more: Construction up, but are we building too many houses?)

Article source: http://www.cnbc.com/id/101354474

Buyers of new homes are seeing more barriers


New homes for sale at a development in Dublin, Calif.

Contracts for newly built homes dipped slightly last month, and strong October numbers were revised even higher.

Article source: http://www.cnbc.com/id/101366971

Buyers of new homes are seeing more barriers


New homes for sale at a development in Dublin, Calif.

Contracts for newly built homes dipped slightly last month, and strong October numbers were revised even higher.

Article source: http://www.cnbc.com/id/101366971

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