When The MGHerring Group began studying the Dallas/Fort Worth area as a site for a new mixed-use development, it zeroed in on Allen, Texas, an established city with strong demographics, says Matt Gallo, CPA and development manager at the company.
The MGHerring Group has developed more than 30 major shopping centers and malls in the United States and Mexico, totaling more than 24 million square feet of retail space. It developed The Village at Allen, a 181-acre mixed-use development that includes the Allen Event Center and Courtyard by Marriott hotel, and its sister development, The Village at Fairview, a 200-acre mixed-use development across the street.
“We found Allen interesting because it had had access in terms of highways but didn’t have the retail to support its community,” Gallo says. “We looked at it and saw the community was underserved. Its residents had to drive north or south for retail opportunities, but it had the demographics to support a development project. So we scouted out the market, landed on a site and worked toward developing it.”
Smart Business spoke with Gallo about how retail developments have evolved and why Allen was a good choice for its project.
How has development changed in the last decade?
Beginning in the early to mid-2000s, there was a big emphasis on open-air shopping centers. People want to get away from enclosed malls. They like the idea of having convenient easy access and being able to pull straight up in front of a store and park. People also like being outside, and the open-air shopping centers have a town square feel to them. That’s something that’s hard to do in an interior space.
Have you seen an increased interest in mixed-use developments post-recession?
I think there’s a lot more interest in multi-use projects rather than mixed use. I refer to mixed use as stacking uses on top of one another, which can be very complicated, complex, costly and time-consuming. When times were good, everyone was jazzed about, and working on, that concept. We saw a lot of proposals; some worked, but a lot didn’t.
What we’re seeing a lot more of now is multi-use, which includes projects that have a lot of uses cobbled together in one center but not necessarily stacked. There is a benefit of certain uses in proximity to one another. For example, The Village at Allen has combined retail and restaurants with the event center, TopGolf entertainment facility and a hotel. Having all those different components is a powerful draw for both retail and business uses. They’ve been planned to work together, and we’ve worked hard to create a pedestrian-friendly feeling.
How have you worked with the Allen Economic Development Corp.?
The AEDC is one of the best organizations I’ve seen. They have been a great partner for us and are very aggressive about bringing development to the city. They’re a good resource to help get the message out about the strength of the market as well as to help us talk to retailers. They help sell the message, for instance, of why we need another Target store in Allen when there is a store three miles to the south. We couldn’t have been as successful as we were without the creative minds and courageous people at the AEDC.
How have you worked with the city of Allen?
The city staff, city council and really everyone over there really helped us. Today, projects need a partnership with the city. To do projects on the scale of The Village at Allen and The Village at Fairview and to attract the retailers there, we needed the city’s assistance to make it a reality and feasible financially. One thing the city did that was a great success was land Cabela’s. It’s not part of The Village at Allen, but it’s across the street, and to the average person, it looks like it’s part of the village. It’s a great retailer that draws a lot of sales tax dollars for the city, and the city was aggressive in working on the deal. A lot of cities wouldn’t have been that forward-thinking.
Do you have any other projects scheduled in Allen?
We don’t have any new projects planned in Allen, but there is still some developable land in The Village at Allen. There are still a few pad sites and about 18 to 20 acres of land to be developed. We’re not sure about the use yet, but we’ll continue to work on that. For us, it’s important to find the right use that has a long-term benefit.
Why would a business want to locate to Allen?
It’s a pro-growth city and a balanced community. It is a big city with about 85,000 residents, but it is able to function very quickly and get things done. The city is also very open-minded and willing to consider and listen. It doesn’t look at everything as a checklist and say, “This is how we’ve done it before so it needs to be like this.” And because of that, it’s one of the most successful cities in Texas. They’ve done a great job with growth and providing economic development incentives not only for retail but also for office employment growth. It has high standards but is open to development instead of trying to chase it away. And even though many cities suffered through the recession with tax revenue declines, the city of Allen has been experiencing record growth every year.
Matt Gallo is a CPA and development manager at The MGHerring Group. Reach him at (972) 448-0200 or visit www.herringgroup.com. Reach the Allen Economic Development Corporation at (972) 727-0250 or www.allentx.com.
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