By Carolyn Shapiro The Virginian-Pilot © February 22, 2014 NORFOLK
The city struck a deal to sell 30 acres of its aging golf course to a local real estate company and Simon Property Group Inc., the mall owner proposing to build an outlet center on a nearby part of the site.
A joint venture between Simon and S.L. Nusbaum Realty Co., based in Norfolk, plans to develop a separate shopping center on the Lake Wright Golf Course parcel that fronts Northampton Boulevard and contains a driving range. City officials said they are negotiating a price for the property, which is owned by Norfolk but sits within Virginia Beach city limits.
Nusbaum and Simon envision a potential $50 million investment in a retail center distinct from the Premium Outlets mall that Simon has proposed for the northwest portion of the Lake Wright site, said Miles Leon, Nusbaum's president and chairman of the board. Their development would not house retailers' outlets, he said, but traditional stores and other tenants that complement and expect to benefit from the Premium center.
"It's a great location," Leon said. "We know that it's going to be attractive to all kinds of retailers that want to be near the outlet mall."
Norfolk Mayor Paul Fraim announced the deal Friday during his State of the City speech at the Norfolk Waterside Marriott.
Leon declined to name any retailers targeted for the shopping center, which would likely be finished after Simon opens the outlet mall, projected for sometime in fall 2015. It could accommodate 250,000 square feet of retail and service space and generate $85 million in annual sales, he projected.
Nusbaum executives have worked with Simon from the start on its Premium Outlets plan, having brought the nation's largest mall owner to the city, Leon said.
Simon, based in Indianapolis, has told city officials it plans to spend about $75 million to open 90 outlet stores on about 50 acres of the Lake Wright property. The city plans to devote about 65 adjacent acres to a recreational area with green space, pedestrian walkways, picnic sections, a possible amphitheater and boat rentals around the lake.
The Premium Outlets project would include a parking area and stormwater retention pond in a part of the property that's in Virginia Beach. Earlier this month, Virginia Beach City Council members expressed concerns about the project generating traffic problems but few benefits for their city.
Virginia Beach Vice Mayor Louis Jones, among those who voiced disfavor for the project, said he didn't have any information about the Nusbaum-Simon property Friday evening and couldn't comment on it.
Leon said their plans illustrate the potential for new development to spill across city lines. "We're very confident that being next to the Premium Outlet mall is going to bring some great opportunities to Virginia Beach."
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