Retail heating up in southwest
Target has sights set on Childress Klein deal

by J. Lee Howard, Charlotte Business Journal

Sources say the center could exceed 300,000 square feet and possibly reach 500,000 -- bumping retail space in the area up by 50%.

Childress Klein officials acknowledge an interest in further retail development near Steele Creek Crossing, which is anchored by a Bi-Lo grocery and Eckerd drug store. But the company declines to reveal details regarding tenants or the scope of the project.

"We are certainly investigating the area," says David Haggart, Childress Klein retail managing partner. "But we are not committed to anything."

Noting the site has the zoning in place to allow expanded retail, Haggart says Childress Klein has been in negotiations with potential tenants, but he declines to name them.

Brie Heath, a spokeswoman for Minnesota-based Target, also declines comment, though she adds the company always keeps its options open in markets where its stores have been successful.

The company already has announced all the stores it plans to open this year, she says. Heath won't say whether the Steele Creek site is being considered for future growth.

According to planning records, the Steele Creek development site, long targeted as a hub of retail and commercial growth, could accommodate as much as 320,000 square feet of additional retail space on 61 acres at N.C. highways 49 and 160.

Haggart says residential growth has made retail development attractive in the southwest part of the county, which is the area's second-smallest retail submarket, according to Karnes Research Co. The area has almost 509,000 square feet of retail space and has had no completions or absorptions since December. Meanwhile, vacancy is 3.3%, the lowest rate in the city except for the area known as the outer southeast, where retail vacancy is 1.9%. Citywide retail vacancy is 8.3%, according to Karnes.

That creates opportunity outside Charlotte's traditional retail markets, Haggart says.

"The Highway 49 area is a great growth corridor," he says. "We have already built out there and have had people coming to us to ask if we should do more. We are quite familiar with the area and are investigating."

Tim Manes, a principal planner in the Charlotte-Mecklenburg Planning Department, says residential growth in the Steele Creek area, both on the drawing board and imminent, would seem to justify more shopping.

"It's definitely coming," he says.

Manes notes the mixed-use project called The Palisades just south of the Steele Creek site. The development is a collaboration between Crescent Resources and Robert C. Rhein Interests and will include 200,000 square feet of retail space, 100,000 square feet of office space and scores of single- and multifamily homes on almost 1,500 acres.

Roads and other infrastructure serving the development are under construction.

"The number of new residential units out there will be in the thousands," Manes says. "Will it support more retail? Over time, I'd say it would."

Keith MacVean, planning commission land development program manager, says he has seen no formal proposals from Childress Klein but has heard the developer is considering an expansion at Steele Creek.

"We have always looked at that corner as an intersection where we want big retail centers," he says.