Downtown tenants include a Whole Foods Market, a Lifetime Fitness gym, outdoor retailer REI and restaurants such as the Yard House and The Cheesecake Factory.
Palm Beach Gardens – Downtown Carousel, PGA National and Artigras
Some of the things that make Palm Beach Gardens great are the Downtown Carousel, PGA National, the 9/11 Memorial and Artigras
Downtown Palm Beach Gardens, a sprawling shopping center in the heart of the city in the north of the county, could be transformed into a new center for dining.
That’s part of the plan of the new owner, Edens, a national real estate developer and operator. In July, Edens quietly purchased Downtown for an undisclosed price from its previous owner, Excel Gardens, an affiliate of Chicago-based ShopCore Properties.
The 37,000-square-foot open-air center in Palm Beach Gardens, formerly known as Downtown at the Gardens, is located on the north side of PGA Boulevard, just east of Interstate 95, off Kyoto Gardens Drive.
Downtown tenants include a Whole Foods Market, a Lifetime Fitness gym, outdoor retailer REI and restaurants such as the Yard House and The Cheesecake Factory.
The new owner of the shopping center is attracted by the increasing popularity of Gardens
In an interview on August 19, Edens CEO Nicole Shiman said the company wants to capitalize on Palm Beach Gardens’ growing popularity.
An important goal is the opening of additional restaurants, including fast food outlets, which can provide employees in the surrounding office buildings with food, especially for lunch.
Edens’ plans are the latest attempt to revitalize the downtown complex, which opened in 2005 and is now under its fifth owner.
The center quickly became a prime example of the state’s volatile real estate economy and the volatility of Palm Beach County’s seasonal business cycles.
But since the COVID pandemic, the city has become less seasonal, thanks to an influx of new and often affluent residents who have made Florida their permanent home. This includes professionals who work for the many new corporate tenants doing business in the city, as well as residents who have moved to the area with their families.
Shiman said Edens believes this also represents an opportunity for Downtown Palm Beach Gardens, which is 80% leased.
Edens, which owns shopping centers nationwide, is also expanding its presence in South Florida, moving north from the coastal counties of Miami-Dade and Broward.
The company owns the Sunshine Square and Oakwood Square shopping centers in Boynton Beach and the Lakeside Center in Boca Raton. Last year, Edens bought the Shadowood shopping center west of Boca Raton for $88 million.
The county’s rapid growth has led to better-than-expected demand from consumers shopping at Palm Beach County’s retail centers, Shiman said, reinforcing the company’s optimism that downtown is also ripe for a reboot.
Additional dining options at Downtown at the Gardens are a priority
Shiman said Edens wants to create more dining options to attract workers in the PGA Boulevard corridor, including at the nearby NextEra Energy office building and the neighboring Divosta Towers complex.
“We want them to come three times a week or on weekends,” she said.
Jeff Sussman, a Boca Raton-based restaurant real estate agent, said the Edens plan makes sense if the company is careful in selecting its restaurants.
“I think if they find the right tenants, there’s no reason why it wouldn’t be a hit,” said Sussman of Sussman Restaurant Brokerage.
Sussman emphasized that the center should attract popular, local operators and unique offerings, such as an upscale nightclub, rather than national restaurant chains.
But retail analyst Orin Rosenfeld is not sure whether Edens’ plan to bring more restaurants to the center will be successful.
When Downtown opened in 2005, the complex featured numerous restaurants, most of which closed within a few years, said Rosenfeld of Rosenfeld Realty Advisors in Boca Raton.
Today, nearly 20 years later, “there’s a hell of a lot of competition” in Palm Beach Gardens, Rosenfeld said.
These include restaurants at The Gardens, PGA Commons and Alton Town Center shopping centers.
Edens also wants to attract other new retailers to the center, such as boutiques not typically found in regional malls, as well as wellness and spa businesses and beauty salons, Shiman said.
“A big part of our specialty is around retailer merchandising and the interaction between individual retailers. We see that (downtown) as a great opportunity because you have a great base of really productive anchors,” Shiman said.
In addition, further community events are planned.
But one thing at a time.
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Edens wants to complete a road that runs through the center of the town. Shiman said this will make it easier for customers to find their way to the center’s entrances, rather than having to wind around the bypass road and then take a path to tenants inside the project.
“The intention is to create significantly better access and visibility throughout the site,” Shiman said.
Another priority is to install better signage to help customers navigate the site, Shiman added.
The ups and downs of the city centre over the years
The plans are the latest changes to Downtown Palm Beach Gardens, which was built nearly 20 years ago by Menin Development.
The center was initially planned as an enclave of exclusive shops and boutiques. But soon after opening, it became clear that the shops and restaurants in the city center did not attract enough customers to cover the high rents.
Critics have said the center’s design is a factor in Downtown’s success. Some of the tenants, located along the center’s interior walkways, are difficult to find.
Over the years, government and business officials even considered demolishing the entire center and rebuilding it in a more consumer-friendly manner.
Rosenfeld said Downtown is still “functionally outdated” because of its two-story construction, which is not popular in South Florida.
Rosenfeld also said Downtown is out of step with today’s shopping habits. Consumers prefer to park in front of a store or restaurant without having to weave through a walkway or park in a distant lot or parking garage, he said.
By 2007, Menin had sold nearly all of his stake to a partnership that included the California Public Employees Retirement System. The sale price was reportedly about $200 million, but the deal was structured so that no sale was recorded with county authorities.
By 2009, as the economy entered a deepening recession, the center’s tenant base had dwindled. The property’s lenders, Berman Enterprises and Ashkenazy & Agus, took over the property in a $138 million foreclosure, reportedly paying only about $40 million for the center.
Berman moved quickly to attract new tenants, some at low or no rent. Berman also made downtown a family-friendly destination by adding a carousel, attracting kid-friendly retailers, and organizing free community events.
By 2014, the downtown area was already full of new and paying tenants, and the Bermans sold the center for $145.5 million to Excel Gardens LLC, a subsidiary of Chicago-based ShopCore.
Excel brought in REI and Lifetime, obtained planning permission for a hotel and apartments and sold the property to Edens last month.
Shiman said Edens is still considering whether to build apartments or a hotel on the site.
Alexandra Clough is a business writer for The Palm Beach Post. You can reach her at [email protected]. X: @acloughpbp. Support our journalism. Subscribe today.
