The developers of Culver City’s Platform on why they’ll never do a deal with a CVS
Joey Miller and David Fishbein of Runyon, a real estate company that specializes in retail-driven development and leasing, are the names behind some of the most talked about retail projects in Los Angeles.
They’re the developers of Platform, the redevelopment of a former car dealership on five acres in Culver City’s Hayden Tract area into a retail and creative office mega-complex. The first phase of the project is slated to debut in March.
They’re also spearheading the lease-up of the Row, one of the most ambitious new retail-driven projects in Downtown L.A., on behalf of developer Atlas Capital.
We sat down with the duo to talk rents, tenant programming and why they’ll never do a deal with a CVS. Read on for a closer look.
You’re getting pretty close to the debut of Platform. Tell us about the project.
Miller: We’re opening in a little bit less than a month. When it’s finished it will be a $150 million project. The first phase of the project will have about 50,000 feet of retail and restaurants and about 80,000 feet of creative offices. Some buildings are old and some are new. We’ve tried to create something that’s really architecturally significant.
How much have you leased?
Miller: It’s about 85 percent leased right now to folks like SoulCycle, Blue Bottle Coffee, Sweetgreen and Linda Farrow out of London for her first eyewear store. The next phase, which will go into construction next year, will have 70,000 feet of office and 7,500 feet of retail.
What are the rents like?
Miller: The rents are anywhere between $5 and $10 triple net on the retail, depending on the size of the space.
Fishbein: On the office side, average Culver City rents are about $3.50 modified gross. We’ve bested that by about a buck a foot.
This area isn’t exactly known for high-end retail. Has it been a challenge to get retailers to see the vision?
Miller: At the beginning, the challenge was just getting to believe that we would even do this. The focus of the area has been art galleries, home design and creative businesses. There hasn’t been any great retail. Now, the next step is opening to the public and letting them get a feel for it.
You’re touting your fresh approach to retail. What exactly separates the way you operate?
Miller: We’re trying to approach the retail real estate business in a new way, whether it’s stuff we own principally like Platform or stuff we’re leasing like the Row in Downtown L.A., which is almost 2 million square feet. A lot of times people will build a retail project and then just sign leases with the first tenants that are willing to come in. We say no a lot more than we say yes. We make a business out of going after specific types of tenants and companies that are part of our vision.
Does that mean you won’t do a deal with a Chase bank or a CVS?
Fishbein: We’ve never done a deal with a Chase bank or a CVS. We’re all about independent, unique merchants and great restaurants and putting them together in a beautiful space.
Miller: Our whole business is predicated on the idea of changing the retail business from a commodity business to something that’s really curated and put together in a meaningful way that will benefit the city.
Tell us about the Row.
Miller: I think we have the scale with the Row to really make a serious impact on Downtown. It’s 500,000 feet of retail and about 1.5 million square feet of creative office space. The first phase is 200,000 square feet of retail and restaurants. We took it out to the market at the beginning of the year. The space will be delivered at the end of this year.
What kinds of tenants are looking at that project versus Platform?
Miller: There’s a lot of overlap between the two. In order to be in the L.A. market in a real way, you need to have a couple of touch points, I think. We’re seeing a lot of brands that might be interested in having a presence in both. The west side is really important and, for the east side customer, Downtown is huge. Just because you have a store on Madison Avenue doesn’t mean you don’t want one in Soho.
There’s been a lot of talk about the viability of Downtown L.A. as a major retail destination. How are you finding the market?
Miller: We’re seeing really strong demand for the project. A lot of people have wanted to be downtown for a long time but they were waiting for the right project to come along.
What kind of rents are you seeing at the Row?
Miller: We can’t really say because we don’t own the project. We just finished a project called One Santa Fe in the arts district and the rents we got there are very similar to those at the Row.
What other trends are you seeing in the retail market?
Miller: The ultimate trend is that there’s a shake out in the retail business right now, where there are certain brands that are resonating with customers and others that may have had historic success but aren’t as relevant anymore. We look at our jobs as making sure we’re always on the cutting edge and bringing in people who are doing things that resonate with our customer.
Which brands are getting it right?
Miller: We love multi-brand retailers like Colette, Silver Street Market and 10 Corso Como. Then, there are companies that are combining e-commerce and bricks and mortar, like Warby Parker, which has done a really good job.
Fishbein: We love when stores offer other kinds of experiences within their spaces, whether it’s a coffee shop or a tea bar, or a concept like Bandier out of New York City, which, in addition to having this designer women’s athletic wear brand, has an incredible fitness studio upstairs.