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Move over national tenants, here come the arts & culture

Until recently, entertainment retail centers were greeted with open arms by city officials and consumers alike. That's because they were, in fact, different and unique. But today, with a new entertainment retail center popping up in every market across the country, the uniqueness fades fast. Consumers are already tired of the music store next to the famous-chef restaurant next to the giant bookstore next to the movie theater.

Furthermore, consumers are dead serious about preserving their local culture and heritage. So if you are planning to bring big-name national tenants and branded concepts to your entertainment center, think again.

Chicago-based Urban Retail Properties learned this lesson as lead developer in re-creating the Fifth & Forbes downtown district of Pittsburgh. But both critics and supporters of the $195 million UEC have expressed concern about plans that lean heavily toward mall-type stores and ignore local retailers. At a local meeting where the project was discussed, one resident said, "I'm thinking of the personality of this region, and I'm not seeing it."

Addressing these concerns, Urban Retail agreed to add local retailers and attractions. "It's not our intent to sanitize the place," said one executive.

Even the hugely successful Universal CityWalk in Los Angeles was met with an anti-brand attitude last fall when it presented plans to develop the second phase of the project, originally meant to be 240,000 sq. ft., about the same size as the first phase. But local residents complained about noise and traffic -- as one local citizen put it, "Enough is enough." CityWalk scaled back the second phase to 90,000 sq. ft.

Are consumers tiring of entertainment-oriented centers? Our findings at ECi indicate that consumers want retail developments that not only embrace the character of their communities but actually promote it. They seek national brands alongside local artists or celebrity chefs. Yes, this makes leasing a more difficult task, but it may be the very thing that saves entertainment centers from the disaster of look-alike malls of the late '80s and early '90s.

Moreover, museums and other cultural attractions are quickly becoming big business. Often considered the domain of "creative types" with little understanding of business, the arts have been overlooked as viable attractions or tenants. But developers planning to attract tourists to their entertainment centers may want to look at recent figures on cultural/heritage tourists. They spend more money, shop more and stay longer.

The arts are being woven into the fabric of our daily lives, appearing in dining concepts, movie theaters, city re-developments and even culturally starved Las Vegas. Here are a few examples of what's coming:

Movie theaters. General Cinemas and Robert Redford formed a partnership last year to bring Sundance Cinemas to communities around the country. To date, two sites -- Philadelphia and Portland, Ore. -- are building Sundance Cinemas with other locations expected to be announced for Chicago, Boston and New York. According to General Cinemas, the company prefers community-oriented sites near other cultural attractions, such as bookstores, jazz clubs or art space.

Restaurants. Brad Weiss, founder of Cafe Tu Tu Tango, spotted this opportunity early on with his artist's-loft theme. Local artists present their paintings on the walls of the restaurant -- all for sale, of course. To further create a festive bohemian atmosphere, the restaurant has live musicians, tarot card readers, palmists and magicians appearing throughout the restaurant on a rotating basis.

Resorts. Steven Wynn, president of Mirage Resorts and visionary behind the Bellagio, made a big bet on culture by creating an Italian-themed resort that houses his $300 million art collection. At a recent conference, Wynn stated, "I no longer consider myself in the gaming business. I am in the theater and arts business."

Retail developments. Scottsdale, Ariz.-based Mashburn-Hope recently broke ground on Scottsdale Waterfront, a retail village that sits across from the Scottsdale Arts and Gallery District. Along with a tenant mix of upscale retailers, restaurants and cafes, plans include a cultural district housing museums and other attractions.

Two other projects of note are Celebrate Virginia and San Francisco at the Wharf, both of which will promote and highlight the rich history of their local areas.

Cities. Many cities are waking up to their cultural assets, not only for retail and tourism but for their own "sense of place" and pride. It is politically correct and something few constituents will argue with. Urban redevelopments are sweeping the country, and in most cases they involve a cultural district.

Cultural attractions or tenants may be difficult to pencil-out in terms of leasing and economics, but they may in fact prevent entertainment retail centers from falling into mediocrity. Savvy, sophisticated and seasoned, today's consumers seek places that refresh, delight, educate and enchant. The arts and culture satisfy that need.

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