The proposed Cornerstone of Centerville project is economically viable despite ample competition from other area retail and multi-use centers, but needs to set itself apart from those other centers to truly succeed, area retail-market specialists and development officials said.
Plans call for Cornerstone to be built near Interstate 675 and Wilmington Pike on more than 220 acres that once belonged to the Dille family. The project would include retail, commercial and residential components and would be built in phases over 10 years, according to preliminary plans submitted by developer George Oberer with Centerville city officials.
Ground could be broken as early as this fall, pending Centerville’s approval of final plans.
The proposed project ups the ante for the interchange at the Centerville-Sugarcreek Twp. border that already offers many stores, including Walmart, Target, Kohl’s, Home Depot and Lowe’s. And it would add another retail-commercial destination along the I-675 and I-75 south corridor that includes the Mall at Fairfield Commons, The Greene Town Center, Cross Pointe Shopping Center, the Dayton Mall, and the partially completed Austin Landing — all large-scale projects that already draw thousands of shoppers on a daily basis.
Can the region support another large-scale retail project?
David McDonald — founder of the Dayton-based McDonald Group retail real estate consulting firm that has no connection to the Cornerstone development — said it can.
“We have a bigger market than you’d think, and it’s a way stronger region than you’d think,” McDonald said.
While Dayton itself is not growing rapidly in population, the broader region is growing, and it’s connecting with northern Cincinnati. Shoppers who drive three to five miles to go to a strip shopping center might travel 25 miles or more to go to a favorite mall or other multi-use shopping and dining destination, McDonald said.
And overall, the Dayton area’s retail offerings — especially The Greene Towne Center and its Dayton and Fairfield Commons shopping malls — exceed Cincinnati’s, even though Cincinnati’s trade area of 2.2 million people is nearly twice Dayton’s, McDonald said.
Centerville Development Director Nathan Cahall said Cornerstone’s developers will seek to distinguish this project from its competitors. That would reduce the “cannibalization” of other malls or shopping centers that could occur if tenants would choose to abandon their current locations in order to move to the new development.
“This development will be a success not only for the city but also for the region if the retail offerings there are unique,” Cahall said. Oberer Companies officials “want to bring in businesses that either have a small presence in the Dayton market, or have no presence at all. They don’t want to duplicate what already available a couple of exits down the freeway.”
John Blair, professor of economics who has taught at Wright State University since 1981, said some reshuffling of retail tenants is inevitable when a new development such as Cornerstone of Centerville opens.
“It almost definitely will result in cannibalization of some areas,” Blair said. “We’ve seen it already,” in the movement of retail out of downtown Dayton and from strip shopping centers such as Eastown in the years following the completion of I-675, he said.
“There is a ‘newest and shiniest’ effect,” Blair said. “Shoppers want to be in the nice areas with the latest fashions.”
McDonald agrees that some cannibalization will occur —and he says that’s not all bad.
“Most of the time, the cannibalization comes from very old centers or older big-box stores that probably should be demolished anyway,” the retail real estate consultant said. “Building new, and building the best, is good for the citizens, it’s good for the community and it’s good for customers.”
Serdar Durmusoglu, associate professor of marketing at the University of Dayton, said Cornerstone’s proposed restaurants and other retail establishments will benefit from having Miami Valley Hospital South nearby. And Durmusoglu noted the project’s planned hotel will fill a need.
Still, the development “needs to have a large residential component to be able to have enough population for business, because the ‘newness’ will not stay for long,” Durmusoglu said.
Durmusoglu said while there is certainly no shortage of retail establishments in and around the area where Cornerstone is proposed, “it’s not oversaturated … yet.”
Developer Steiner + Associates, which owns The Greene as well as Easton in Columbus, has demonstrated that it doesn’t believe southwest Ohio is oversaturated with retail.
The Columbus-based company is scheduled to start construction later this year on Liberty Center, another multi-million-dollar mixed-used retail, residential and office development coming to the I-75-Ohio 129/Liberty Way interchange in Butler County. Dillard department stores and CineBistro movie theaters have signed on to be anchor tenants of the project. The $300 million first phase of the project is slated to open in 2015.
Marshall Loeb — CEO of Glimcher Realty Trust, the Columbus-based company that owns and operates the Dayton Mall and the Mall at Fairfield Commons — said in an email response to questions about the new Cornerstone development that his company views its two malls as “the two retail anchors in the market” because of their convenience, locations and variety of retail stores.
“You never want to see additional competition come into a market, but we’re very pleased with our two Dayton properties.” Loeb said.
Cornerstone of Centerville competition
Major nearby retail centers
Major nearby retailers
• Home Depot