So if the Eclipse Development Group’s project for downtown Derby is so sweet, how come tenants are not signing up?
The Valley Independent Sentinel posed that question to Eclipse Development’s Douglas Gray following a Sept. 21 meeting of the Derby Redevelopment Agency.
At the meeting, Gray said interest is high in the project — a conceptual plan to redevelop a swath of the south side of Derby’s Main Street into a 180,000 square feet shopping village with restaurants and shops.
The validity of the development project is a major issue in the Nov. 8 election. Democratic mayoral hopeful Dan Foley is saying incumbent Mayor Anthony Staffieri is putting on election-time rose-colored glasses about redevelopment to win votes. Staffieri said Foley spreads misinformation.
Click here to read a story on the thorny political issue.
Gray said his company has interest from eight to 11 potential tenants.
Why haven’t they signed on the dotted line?
Gray cited two reasons:
1. It’s too early.
The opening day for the shopping center Eclipse envisions for the area between Main Street and the Housatonic River isn’t until 2014. Retailers aren’t thinking that far ahead, especially in this economy.
“Our doors aren’t scheduled to open until 2014, so we’re just off their radar screen. Once we get into 2012, they’ll start to look at 2014,” he said.
2. Investors aren’t asking the right questions.
The retailers Gray’s company has been talking to are publicly-traded companies. They’re waiting for Wall Street to ask the retail giants “When do you plan to open more stores?” Gray said.
That question hasn’t been asked in awhile due to the economy and recent convulsions in the stock market, Gray said.
Instead of ‘how many stores will you open next year,’ investors have been asking ‘What are you doing to cut costs and become more efficient?’ Gray said.
A few years ago — 2005, for example — retailers were on a massive expansion kick, Gray said.
That has been scaled back for about three years now, the developer said.
Gray said retailers will soon start looking toward opening more stores — because they have no choice.
“They are beasts of Wall Street. They are publicly-traded companies. Stock prices are based on growth and returns,” he said. “If you don’t grow in retail, you die.”
Gray said some negotiations with tenants are over — and have been for some time.
Eclipse is simply waiting for them to sign.
“The fact all the tenants are in discussion with us is great news. The question is — when does the trigger get pulled? It could be three months. It could be six,” Gray said in September.
Gray said the situation in Derby is not unusual.
“I’ve been developing real estate for 25 years. That’s they way it works,” he said.
The proposal from Eclipse is just a concept at this point. The company still has to acquire land from property owners in the redevelopment zone. In addition, no plans have been submitted to the city’s Planning and Zoning Commission.
A message seeking information to update this article was left with Gray Oct. 21.
