Along with the condo market and the hospitality industry, the retail sector in Miami-Dade County has bounced back from the downturn, and developers and retailers are scrambling to expand existing shopping centers and build new centers in emerging markets such as the Design District, north of downtown Miami. As Terranova Corp., a Florida real estate advisory firm, reports in the 2012-2013 Miami-Dade County Retail Report, current shopping center inventory totals over 31 million square feet.
Shopping Mall Expansions
Shopping malls in Miami-Dade County have been expanding to meet the increasing demand for new retail space. Dadeland Mall in Kendall added a new wing with 100,000 square feet of additional retail space, while Bal Harbour Shops plans to expand by 200,000 square feet. As reported in Miami Today, several stores within Bal Harbour Shops have recently increased their space within the existing shopping center, including Chanel, Audemars Piguet, Brioni, Loro Piana, and Prada. Developer Dacra plans to build an upscale retail destination of more than 500,000 square feet in the Design District; luxury retailers including Louis Vuitton, Hermes, and Prada are among anticipated tenants.
Opportunities Outside the Urban Development Boundary
Demand for luxury retail is so strong that developers are looking at sites located outside the Urban Development Boundary for opportunities. As reported in the Miami Herald, the owners of Aventura Mall and the Fontainebleau Hotel proposed Doral Crossings, an upscale shopping mall, IMAX theater, and five-acre water theme park, which would be located along Northwest 41st Street west of the Florida Turnpike, close to an area known as the Lake Belt, where limestone rock is mined using controlled explosions. Due to the controversy surrounding the proposal to move the Urban Development Boundary, the developer’s application was withdrawn at a hearing before the County Commissioners on November 20.
The increasing demand and competition for land, particularly for large tracts, is causing retailers to look at sites designated as brownfields, defined by state statute as properties where the expansion, redevelopment or reuse may be complicated due to real or perceived environmental contamination. Development of designated brownfields and other contaminated properties can be challenging, due to the cost and time to address soil and groundwater issues, including working with regulators to get approval to redevelop the sites. The state offers cleanup tax credits against Florida corporate income tax, as well as certain liability protections, for developers who voluntarily clean up brownfield sites. Swedish retailer IKEA is moving forward with plans to build its first store in Miami-Dade County in 2014, a 417,000 square foot store to be located in a designated brownfield in Sweetwater, adjacent to Dolphin Mall.