Firm questions viability of Novus' Main Street at Sunset
March 23, 2005 - By SCOTT MILLER
A real estate and economic consulting firm for Crestwood contends that the Novus Development Co.'s proposed $163.9 million development in Sunset Hills cannot work.
In addition, the "lifestyle center," if built as proposed, would strip $20 million to $27 million in sales away from Crestwood's Watson Road Commercial District, including the Westfield Shoppingtown Crestwood, Melaniphy & Associates Inc. President John Melani-phy wrote in a March 17 letter to Crestwood City Administrator Don Greer.
And other Sunset Hills businesses could suffer as well, according to Melaniphy.
"Adding more specialty store space will result in increased vacancies in Crestwood and Sunset Hills," Melaniphy stated.
A firm of real estate counselors, site selection specialists, market analysts, retail experts, restaurant consultants, and international investment advisers, Melaniphy & Associates of Chicago, Ill., currently is performing a market feasibility study for Crestwood in conjunction with the proposed redevelopment of the Westfield Shoppingtown Crestwood.
Westfield is paying for the $32,000 study. Under the terms of the preliminary funding agreement, Westfield is advancing the city $97,250 to pay for planning studies, reports and legal documents needed to proceed with the proposed mall redevelopment.
Melaniphy said the area is too saturated with commercial properties to support Novus' plan. The letter increases the opposition to Novus President John Browne's request to Sunset Hills officials for $42 million in tax-increment financing assistance, or TIF, for a $163.9 million development at Watson Road and Interstate 44 by South Lindbergh Boulevard. He wants to develop 67 acres into a lifestyle shopping center with "high-end" retailers, restaurants and office space, called Main Street at Sunset.
Lindbergh School District officials have expressed concern the project would strip money away from schools. Plus, the plan calls for razing about 255 homes in the Sunset Manor subdivision, and many residents have protested, hoping to keep their houses.
In fact, those residents formed Sunset Hills Land Grab, a group of residents and businesses opposed to the redevelopment. They planned to present their opposition to the city's TIF Commission during a public hearing Monday night — after the Call went to press.
The commission must make a recommendation to the Sunset Hills Board of Aldermen, which casts the final vote. The commission may have made its decision at Monday's meeting.
Sunset Hills financial consultant John Brancaglione of Peckham Guyton Albers & Viets has said the plan can work because of its uniqueness to the area. He has seen a list of tenants interested in setting up shop, but cannot release the names because of a confidentiality agreement.
At TIF Commission meetings, Brancaglione has said Browne's project would bring shoppers from throughout the metropolitan area and potentially help other local businesses.
Melaniphy doesn't support that opinion, though he doesn't know the tenants Browne intends to bring.
"It is unlikely that a true lifestyle center can be developed on the Sunset Manor site because of the existing placement of lifestyle-type retail stores in west county and south county malls, Plaza Frontenac and the St. Louis Galleria," Melaniphy wrote.
"Furthermore, in my opinion, the number of planned restaurants is excessive given the existing restaurants on both Lindbergh and Watson roads ...," he continued.
Melaniphy authored the book "Restau-rant and Fast Food Site Selection," which is to be re-released this summer.
"Finally," he said, "the largest planned anchor proposed to contain 200,000 square feet is untested in the St. Louis market ... Based upon our analysis of the Watson Road Commercial District, we have concluded that the overlapping trade areas cannot support both the existing retail and the proposed development ...
"Crestwood and Sunset Hills are both mature areas," Melaniphy added. "The median age of the population is currently estimated at approximately 43 years. More-over, the population within the trade area is declining rather than growing ...
"(Consumer) dollars are being shared with Crestwood mall, West County mall, South County mall, and to some extent with Plaza Frontenac and St. Louis Galleria," he stated in the letter. "In addition, personal consumption expenditures are also being shared with older business districts, and the major big box retailers located throughout this southwest suburban segment of the St. Louis metropolitan area.
"In summary, the proposed Sunset Manor Redevelopment Project, including Main Street at Sunset, if built, will have a major negative impact on the Watson Road Commercial District," Melaniphy said. "In our opinion, the resulting sales will largely be shifted from one city to another."
Browne was unavailable for comment before the Call's press time.