Anticipating the potential for disagreement and vitriol surrounding the potential reuse and redevelopment of the former, Kmart-anchored center at 500 Atlantic Blvd. in Neptune Beach, I felt it prudent to convey an alternative perspective. Change, particularly in this age of disruption, is something that is often an easy target of groups who, under the cover of NIMBYism (Not in My Backyard), focus only on the potentially negative and lowest-common denominator aspects. On the contrary, it is more productive when a community offers constructive criticism to yield more informed decisions and better outcomes rather than drive such processes with a zero-sum game approach.

While the economic recovery since 2009 has produced low unemployment rates and high productivity, it has also brought with it a re-thinking of real estate development that is much different than the previous boom period of the early to mid-2000s. Changing demographic preferences, particularly of millennials and “downsizing” boomers demanding mixed-use, walkable communities, a variety of housing types, resource conservation, as well as a repurposing of older buildings and assets, has provided an opportunity for citizens to re-imagine their neighborhoods and building stocks as to meet this demand.

The Beaches represents a perfect location to capitalize and embrace our success and investment synergy as an attractive community for redevelopment interests. This will require and open and honest assessment of the market and land development regulations, while recognizing that the traditional, negative perspectives surrounding mixed-use and multifamily housing options need to be laid to rest — particularly traffic, crime, noise and other misplaced externalities.

Concept/proposal of the potential use for the Kmart lot.

One of the more recurring themes of the 2017 news cycle was the death of big box retail (aka the “retail apocalypse”), especially in the wake of America’s shifting preferences to online shopping. While urban planners and real estate professionals have been lamenting the decline of the traditional shopping mall for more than a decade, industry estimates of this past year alone indicated that more than 8,600 stores could close — including many of the brand-name anchor tenants synonymous with our American capitalist heritage (i.e. Sears, Macy’s, JCPenney and Radio Shack).

By 2022, it is estimated that 1 out of every 4 malls in the U.S. could be out of business. Some have canonized this phenomenon into an art form (see Seph Lawless’s high-quality coffee table book: “Black Friday-The Collapse of the American Shopping Mall) while others do autopsy work confirming America’s evolving consumer culture and leading, global economic indicators.

The location of the empty Kmart and parking lot.

This phenomenon can be largely attributed to a combination of three major factors:

First, the exponential growth of e-commerce: It is a fact that the impact of Amazon and other online distribution options will continue to grow and replace many shopping trips. The National Retail Federation is projecting on line product discovery and purchase growth to be five times faster than offline sales. To put into perspective, the mobile shopping share grew from 1.8 percent in the 2nd quarter of 2010 to 20 percent by the 3rd quarter of 2016! This is full-scale disruption.

Second, the existing over-supply of retail in the U.S.: In April of 2017, CoStar’s director of retail research, which is the world’s number one leading commercial real estate research firm, stated that, “There’s about a billion square feet of retail space that needs to go away, that needs to be converted, for the market to get healthy.” The U.S. leads the world in commercial square foot per capita (almost six times that of the UK) and this excess amount means that there isn’t enough demand to refill many vacant big-box centers with new big boxes.

Third, the shifting preferences of millennials from materialism to experience and authenticity: We are witnessing a growing trend in what is referred to as “eatertainment.” The under-40 crowd increasingly allocates discretionary income to food, travel and entertainment, particularly high-quality and locally sourced versus their older counterparts. This means less on “stuff” and more on experience with friends that can be shared instantaneously via social media platforms, such as Instagram. Industries are keenly aware of this fact and recognize that such activity is forcing them to modify their marketing approach.

Photo of Cityplace, a good example of infill redevelopment that could be a model for the Kmart.

These three elements are working against the traditional shopping center, especially in the wake of the demand for urban, walkable places. The process is quite predictable — the anchor tenant departs from a large center, then a ripple effect occurs where smaller, supporting retail and service providers struggle to remain and then communities are left with what the land development industry refers to as a “greyfield.”

This ultimately leaves us with the question of what to do with all the space left behind? Communities can make two choices. Look at their sites as nuisances waiting with futility for a broker to lease them again, or look at it as an opportunity to transform their “greyfields” into lasting places — giving people a reason to come to these centers beyond filling their shopping bags.

Mizner Park, an example redevelopment of a former enclosed mall, known as the “Boca Mall.”

There are a growing number of repurposed centers across the country built around this concept of place making, with the recognition that redeveloping older, underperforming commercial centers into mixed-use, walkable destinations is the most effective, long-term strategy to enhance the economic and quality of life of the surrounding community. From Belmar in Lakewood, Colorado to Mizner Park in Boca Raton, the transformation of declining regional malls and shopping centers into residential, retail, office, parks, plazas and other public spaces not only supports community redevelopment goals, but more importantly addresses this global shift in preferences among millennials and boomers. In other words, these are same people who desire to work in their loft apartment, then grab some avocado toast at the artisan eatery, and later walk over and hang out at the local craft brewery — all in the same walkable location!

Another shot of Cityplace.

The successful redevelopment of these sites means that you’re also maximizing potential revenue support to your town, city, and neighborhood. Businesses pay sales taxes to the city and county and all that that tax money previously lost in these “greyfield” sites can be used to support public schools, new parks, improved transportation and utility infrastructure, as well as fund the growing expense of public service workers, like firefighters and police. It also makes the statement that your community embraces high quality development and the live-work-play lifestyles that can be accommodated in a compact, walkable environment.

More significantly, it is the opportunity to create a place that has the compelling ability to attract people, shaping and inspiring the physical and social character of a community for generations to come. The Beaches community has demonstrated a willingness to bring in new investment, including a variety of ever-popular, unique and authentic local businesses. Perhaps we should allow these investments to flourish in an environment that supports walkability and a mix of uses. This has proven to be the most successful and memorable development form since the dawn of civilization.

By Fred Jones | Contributor