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Rentschler Field Retail Plan Gains Traction


February 18, 2013

State and local officials have been in deep discussions with an Arizona-based real estate development firm that is proposing an ambitious retail and entertainment destination outlet center at Rentschler Field, with a price tag in the range of several hundred million dollars, sources have told The Hartford Business Journal.

The company, called OTB Destination, has already provided plan overviews to state and city officials, United Technologies Corp., the Department of Economic and Community Development (DECD) and the Capital Region Development Authority, sources say.

Officials from OTB Destination, which specializes in repositioning distressed shopping centers, also recently provided an economic impact analysis of their plan to DECD, sources say. The firm is seeking financial assistance from both the state and city of East Hartford.

OTB officials didn't provide comment for this story.

Full details of the planned development weren't available at press time. But sources say OTB's plans for East Hartford are similar to a retail and entertainment outlet center in Kansas City, Kan., known as Legends Outlets Kansas City.

In 2010, OTB helped reposition Legends Outlets as a more upscale retail and entertainment venue and brought in retailers like Saks Fifth Avenue OFF 5th, J. Crew Factory, and Under Armour Factory House, according to published reports.

Those are the types of retailers being targeted for the proposed Rentschler Field outlet center, sources say. The plan will likely target entertainment venues as well.

While other developers have offered plans for Rentschler Field in the past, sources say OTB Destination is the most serious proposal yet because of the firm's ability to do deals with big name retailers.

Another key to the proposal, sources say, is that United Technologies Corp., which owns the East Hartford tract outside Rentschler Field, is showing serious interest in OTB's plan, giving it much more traction.

In a written statement to HBJ, UTC said it has signed a letter of intent with OTB Destination, which is "formulating plans for a new destination retail and entertainment complex on the Rentschler Field campus."

UTC added that it "has long believed in the economic development potential of the Rentschler Field property and believes OTB's vision for the site has the potential to build on the success of the existing Cabela's retail project and further realize the site's full economic value for the region. OTB has begun preliminary discussions with regional stakeholders this month and OTB will be announcing any new information as it becomes available."

State Sen. Gary LeBeau, an East Hartford Democrat who co-chairs the Commerce Committee, said he has seen an outline of OTB's plan, which he described as a "massive retail and entertainment-oriented development," with a price in the range of "a couple hundred million dollars."

LeBeau would not provide further details on the project, but he did say if the development were to go forward with state assistance, it would likely need approval from the legislature.

Development at Rentschler Field has been in the works since 2005 and was projected to take about 18 years to complete, but it has hit stumbling blocks in recent years because of the economic downturn.

The project got off to a fast start when Cabela's opened in 2007. Cabela's was expected to serve as a catalyst to attract other retailers to the area but that hasn't happened yet. The economy has been a major roadblock; infrastructure issues have also played a role.

Regardless, the main focus continues to be on the development of a vibrant 24/7 technology-based live-work community, sources say. Plans still call for a $2 billion plus mixed-use project with new offices for technology companies, hotels, retail, entertainment and housing.

OTB Destination would be involved in the retail and entertainment portion of the project, including the planned town center.

Sources say if OTB's plan comes to fruition it will lead to development of the hotel and residential components.

Developer Dan Matos, who was hired to develop the East Hartford tract, declined to comment for this story. But he previously told HBJ that he had letters of intent from a hotel operator and an apartment developer ready to begin construction on a 300-unit, six-story, mid-rise style apartment complex that would target young professionals and empty nesters.

But those projects won't go forward until retail and restaurant tenants agree to occupy the outlet center.

Having the hotel, retail and residential components built at the same time is important to balance the cost of building the necessary infrastructure, including new roads.

According to its website, OTB Destination, which is based in Arizona, has been involved in several outlet center projects. The firm said it specializes in repositioning underperforming or distressed shopping centers, but it also getting involved in ground-up development.

Their projects focus on "open-air streets and typically encompass in excess of 100 acres," their website said.

Most notably, OTB Destination was hired to reposition and rebrand Legends Outlets Kansas City, which originally opened in 2006 as a shopping lifestyle center. OTB helped reposition the center in 2010 as a more upscale destination retail and entertainment outlet venue, according to published reports.

It has 1.1 million square feet of retail space, more than 60 outlet stores and restaurants, and a 14-screen movie theater, according to its website. Retail tenants include Polo Ralph Lauren, J. Crew, Nike, Forever 21, Tommy Hilfiger, and Brooks Brothers. Restaurant and entertainment tenants include Dave & Buster's, Yard House and T-Rex, which is a 20,000-square-foot restaurant with animated dinosaurs in theatrical settings, according to the outlet center's website.

However, recently, Legends Outlets Kansas City fell into foreclosure and was auctioned off last month to a new ownership team for $131 million, published reports say.

The outlet center has a 5 percent vacancy rate, Bloomberg reports.

OTB Destination is also active in two outlet center projects in Nebraska. One involves co-developing an $87 million outlet mall in Nebraska called Smart Outlets at Nebraska Crossing that proposes to have more than 60 tenants in 350,000 square feet of space. That project is scheduled to open this fall.

The other project involves repositioning an existing shopping center in Omaha.

OTB Destination also has projects planned in New Jersey and Dallas, Texas, according to the firm's website.

Reprinted with permission of the Hartford Business Journal. To view other stories on this topic, search the Hartford Business Journal Archives at http://www.hartfordbusiness.com/archives.php.
| Last update: September 25, 2012 |
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