Plans are moving ahead for competing proposals for two outlet malls in eastern Nebraska — just 11 miles apart on Interstate 80.
The developers for the two projects are optimistic, even as questions remain about whether both projects can happen given their proximity to each other.
At Nebraska Crossing, the developer says he's working with enough stores to fill more than half the space. An unspecified number of stores have signed leases, and others are in the negotiation stage, said Rod Yates of OTB Destination, based in Park City, Utah.
He hopes to announce tenants for the redeveloped center at the intersection of I-80 and Nebraska Highways 6 and 31 by early May, start construction this summer and aim for a grand opening in August 2013.
Meanwhile, a new shopping center — Outlets at Southport West — is envisioned near Cabela's and the La Vista Conference Center at the Harrison Street interchange.
In a recent statement, Baltimore developer Cordish Cos. said the company has made "excellent progress" on all aspects of the proposed mall, including leases and design plans, and hopes to start construction this year. The company says it self-finances its developments.
Neither developer is ready to announce the names of retailers with signed leases.
Charlie Devine, who is a real-estate consultant for dressbarn, Justice and Maurices based in River Vale, N.J., said he believes there's room in the market for only one outlet mall.
His clients have signed letters of intent with Nebraska Crossing and are negotiating leases. Only one of Devine's clients, dressbarn, currently leases space in Nebraska Crossing.
Devine said whichever site attracts big-name "anchor tenants" like Nike, Gap and Polo Ralph Lauren will bring in the other brands.
"Once landlords get several of those, then everybody else follows," Devine said.
Trenton Magid, principal of World Group Commercial Real Estate in Omaha, agreed that tenants will follow a "herd mentality." Magid is not involved in either project but has managed several land sales and leases in La Vista.
"Once you get those top five or 10 ... everybody else comes along and will pay the price," Magid said.
At a glance: Nebraska outlet mall proposals
See a map of the projects.
Nebraska Crossing, Gretna
Redevelopment, expansion of existing outlet mall
325,000 square feet with more than 60 stores
Cost: $70 million
Adding parking spaces, three restaurants, two hotels and space for community activities.
Construction to begin this summer with completion expected by August 2013.
Outlets at Southport West, La Vista
New outlet mall
435,000 square feet, number of stores not yet announced
Cost: $114 million
Includes an entertainment district, called “Live!,” with restaurants and a space for outdoor events like concerts and art festivals.
Construction to begin sometime this year.
Yates said in a recent interview he believes Nebraska can support only one outlet mall.
Asked about reports that Coach may put one of its factory stores at Nebraska Crossing, Yates said the luxury handbag company would be "a target retailer for anybody doing an outlet center."
However, he said he has no commitment from Coach. "At this point we're waiting for them to tour the market. They haven't done that," he said.
Yates was the developer for Legends Outlets Kansas City, which opened in 2006 in Kansas City, Kan., and is anchored by a Nebraska Furniture Mart and Cabela's.
For the Gretna project, he's working with longtime Omaha developer Frank Krejci. Both are investors in the project.
"I just know it's going to be a good project, a good investment and be good for the city," Krejci said.
Yates said that the project will nearly double the distressed mall's square footage from about 170,000 square feet to 325,000 square feet, adding roughly 50 new stores, three restaurants and two hotels. About 40,000 square feet will be leased by existing tenants, which also include Carter's and OshKosh.
The project is estimated to cost about $70 million and could generate $125 million to $150 million in sales annually, Yates said.
The existing outlet mall brings in $5 million to $10 million in sales a year, Yates said. The redeveloped mall would have a row of stores to the south of the current mall, creating a main thoroughfare for shoppers between the existing and new structures. More space for parking and community activities would be added.
Both La Vista and Gretna have in place a sales tax incentive, passed by the Legislature in 2010 and approved by voters in each city, to help fund their respective projects. The incentive allows 1.5 percent of local option sales tax generated by finished projects to be used to fund them for 10 years.
Cordish has developed similar projects elsewhere, including the Power & Light District in downtown Kansas City, Mo.
The company said Southport West would be comparable to "The Walk," its Atlantic City, N.J., development with outlet stores such as Nike, Polo Ralph Lauren and Calvin Klein.
As of last year, the La Vista project was proposed to cover 435,000 square feet at a cost of about $114 million. It would include an entertainment district for live music and community events.
One issue with the La Vista location, Devine said, is that it's closer to existing shopping centers. Justice, for instance, has stores in Westroads and Oak View Malls in Omaha.
Devine and Magid said many companies prefer to have their outlet stores farther from major department stores that sell their products.
However, Magid said that outlet malls are not always located on highways and Interstates between cities. Many cities have grown out to their outlet malls, he said, noting that Las Vegas now has two on opposite sides of the city.
Magid said Yates, who's also working on the Crossroads Mall redevelopment at 72nd and Dodge Streets, may be able to draw in tenants by negotiating with companies who want stores at both Crossroads and Nebraska Crossing.
"Nobody knows until the leases are signed and something's coming out of the ground," Magid said.
Nebraska outlet mall projects
View Outlet mall projects in a larger map