Taubman Centers Reveals $500M Re-Imagination of L.A.’s Beverly Center
- Mar 09, 2016
Los Angeles’ Beverly Center, commanding a well-traveled intersection at the edge of Beverly Hills and West Hollywood, is poised to undergo a half-billion-dollar beautification. Taubman Centers Inc., owner of the upscale 886,000-square-foot shopping destination, will kick off a renovation program this month with the goal of re-imagining the 1980s-era property.
The idea is to take Beverly Center to new heights. “Our goal in re-envisioning the center is to create L.A.’s most exciting, dominant, urban shopping and dining experience,” Robert Taubman, CEO of Taubman Centers, said during the retail REIT’s fourth quarter 2015 earnings call in February.
And if anyone knows what is required for the Beverly Center to realize its full potential, it’s Taubman Centers, which developed the enclosed regional mall in a joint venture in 1982 and became sole owner in 2004. Taubman Centers has kept the property in fine shape with an upgrade here and an upgrade there, but the company determined the timing is right for a comprehensive renovation, or more precisely, a complete transformation. It’s a decision that can hardly be attributed to poor numbers, as Beverly Center has long been a top performer in the REIT’s impressive portfolio. No, it has to do with something else.
“You are looking at a market that requires it,” Taubman added during the earnings call. “Markets don’t wait for the economy, the XYZ or the capital market to improve or whatever. You’ve got to operate your business within the competitive nature of that market you are in. And we see significant opportunity in what we are doing there.”
The Italian architectural firm of Studio Fuksas is onboard for the renovation project, tapped with redesigning a building that has been frequently described in the press as unattractive from day one. Beverly Center will be reborn with such features as a façade adorned in perforated steel, a continuous ribbon of new skylights, a row of street-level restaurants for destination dining and a gourmet food hall. There will also be new accommodations to further enhance the visitor experience, including an additional valet and a cutting-edge smart parking system.
It’s a hefty undertaking, and Taubman Centers has no illusions about the near-term financial implications of the $500 million investment. “This will be a very expensive project and the initial returns will be lower than we have seen at our most recent developments. However we enjoy an incredible central location that sits in a unique and very dense market with enormous affluence and an extremely fashion-forward customer. It is a key asset in our portfolio and when complete, it will continue to be one of the most productive assets in the country,” Taubman said.
Beverly Center will be ready for its close-up by the 2018 holiday season.