Meet The Woman Tasked With Leasing Up Brickell City Centre's 500K SF Of Retail
When Swire Vice President of Retail Debora Overholt spoke to Bisnow for a phone interview, she was in Italy, scoping out brands that she would love to see join Brickell City Centre’s 500K SF outdoor mall, which opened in Miami’s hot downtown neighborhood, Brickell, in late 2016.
The 120 doors at Brickell City Centre are 90% leased already, but Overholt said she is still looking to vary the mix of stores.
“There are a few merchandise categories we haven’t filled," she said. "We’re looking for specific uses to complete the overall offering. We curate a mix, because the whole is a lot stronger than the individual pieces.”
In particular, she was hoping to lure quality purveyors of linens, kitchen and bath items, and children’s goods. Even though the population of Brickell doubled between 2000 and 2015 to 28,000 people — most of them living in sparkling brand-new condos — “It’s not easy to buy a towel or sheet,” Overholt said.
Miami’s downtown had for decades been desolate outside of weekdays — Brickell is home to 53 banks, which led Forbes to dub it "Wall Street South" — but a new wave of young professionals, especially from Latin America, has made it trendy. Restaurants, bars, hotels and condos sprang up as a result.
While Overholt was scouring Italy for great retailers, her supervisor had gone scouting in Paris and a counterpart was eyeballing Asia. On a prior Italy trip, Overholt found the inspiration for what would become La Centrale, the center’s 40K SF food hall, which opened this year.
Overholt began her career in department stores around Washington, D.C. She worked for Leonard Farber, founder of the International Council of Shopping Centers. She went on to oversee leasing at suburban and super-regional malls, and came to Miami in 1999 to focus on Simon Property Group’s Dadeland Mall, where she generated the largest increase in temporary leasing revenue in the company’s history (a more than 300% gain).
Commercial real estate is still a male-dominated industry, Overholt said, but she had been a tomboy as a kid and made sure to stand up for herself and her values as she started her career in the 1980s. She never dealt with sexual harassment in the industry, she said.
Although most shopping center developers were men, “one of their most effective tools was a woman,” Overholt said. “We are the prime demographic. I knew the right stores, the right tenant mix. They had no clue. They realized pretty quickly that a woman was a competitive edge.”
She generated results, so she was respected, she said. Furthermore, she was never paid less than her male counterparts.
“I was always paid highly because I produced,” Overholt said, adding “I make it my business to know what the market is for what I do.”
At her current level, it is typical to be paid not on commission like a broker, but rather a base salary plus a bonus for meeting certain goals, she said. In 2012, Overholt joined Hong Kong-based Swire Properties Inc. by going to them and pitching herself as great for the job.
Swire had invested in land on Miami’s Brickell Key in 1976 and eventually built $1B of hotels, offices and residences there, including a Mandarin Oriental hotel. But its primary business has been the development of residential and commercial projects in China and Hong Kong.
Brickell City Centre is a commercial, mixed-use project in the U.S that was planned in 2000 but dropped after the financial crisis, then revived around 2012. It has two residential towers and a hotel; two mid-rise office towers are also part of the project. Bal Harbour Shops and Simon are partners. Overholt was hired to oversee the retail, including operations and marketing.
“It was a pretty blank slate,” when she came on, she said. Swire had gotten as far as digging the parking garage.
Swire had negotiated with the city to make Brickell City Centre part of a Special Area Plan, which would allow signature architecture and signage. As the project was in development, Overholt sought merchandising anchors. Whereas big companies like Simon might have a corporate U.S. office that provides templates for marketing, outreach and business plans, Overholt was largely free to devise her own strategies.
“You have to go out and say, ‘This is our vision,' and articulate that vision,” Overholt said.
The development team imagined an upscale offering, but with a broader merchandising mix than luxury goods alone. Overholt sought high-quality brands in every segment, from restaurants to salons, that were on-target for the market, without duplicating categories.
Ultimately, she brought Saks Fifth Avenue into a 107K SF space as an anchor tenant. She also signed Zara and CMX, a Mexican-based VIP movie theater. At the four-level complex, Overholt said, luxe brands wanted the street level. The second floor was for premium brands. The third and fourth floor are for food, beverage and entertainment.
"[Tenants] of course want to understand the overall merchandising program," she said. "They also want to know who their neighbors are going to be, who’s adjacent, how we are positioning the project, and what the landlord is doing to support them from a marketing perspective.”
Typically, tenants have to share their monthly sales reports with the landlord, but because Brickell City Centre was brand-new, it was challenging not to have a track record of sales to show. But in Brickell, the density alone was a huge draw, and retailers had been hungering for fresh space downtown for some time, Overholt said.
“Once they visit and see the cranes — 30 towers going up — it’s pretty easy,” she said. “They’re really looking for density. Certainly, in Miami, it’s the visitors’ market also. There are 3,000 hotel rooms. That’s important. People also have second homes here, third homes. They’ll be here for six months.”
Overholt said that she has turned away potential tenants who did not fit the center’s brand. She will also adjust rents for stores selling small-ticket items like ice cream.
“The margins are just not there,” Overholt said. “We take that into consideration. The most important thing to us is to curate the right mix. Rents are going to have to vary. It depends on the retailer and their margins. This is a partnership and we want our retailers to be successful.”
When it comes down to the nitty-gritty of negotiating a lease with a new tenant, Overholt considers not only the dollars, but also the intangible values such as signing a strong brand.
“A lot of times, tenants want a risk-free deal coming in, especially if they are just entering the market or it’s a new project,” Overholt said. “In some cases, the rent can be calculated as percentage of sales."
But in Miami, she said, that often backfires for the tenant as the landlord gets the better end of the deal because the retail performs well. She said she warns tenants to take the base rent because of anticipated sales. The culture of shopping is different than in other high-income markets, like D.C.
"People [in Miami] shop like I’ve not ever seen," she said. "They’re not sensitive to price. They load up and go ... It’s a whole different type of mentality of shopping in Miami. Part of it is the high ratio of visitors to locals. Visitors spend three times as much as locals. But everyone [in Miami] wants to have a certain status. They want the brand that’s important to them.”
And she does not sweat Amazon one bit.
“That’s the beautiful thing about Miami," she said. "Shoppers want it right there. They want to touch it, feel it, walk out with it.”
For real estate executives not in such a shopping-crazed market, Overholt suggests focusing on entertainment and offering a unique experience. She uses digital marketing to activate new products and create destination events.
She focuses on her key demographic, even knowing details like the fact that most customers come from neighborhoods to the south — office workers on weekdays and condo dwellers on weekends. She also scans Instagram for trends from South Beach to Milan.
“The days of retail standing behind the register just selling are over," Overholt said. "You have to look for brands or retailers that have an online and a brick-and-mortar commitment, that are out there servicing the customer. The ones I see doing well are doing well with all segments of the market — not just millennials. Those are the types of operations that I look for.”