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Talk About Walkabout
Residents soak up American spirit at Caruso Affiliated's new mixed-use community.
National Apartments Association UNITS Magazine - January 2009

by Victoria Harker

Residents soak up American spirit at Caruso Affiliated's new mixed-use community in downtown Glendale, Calif. Four blocks in downtown Glendale have risen from blight to become one of the hottest destinations in Southern California. A new $400 million lifestyle center, The Americana at Brand, has taken over. Combining luxury living, shopping and recreation with 900,000 square feet of upscale stores, restaurants, entertainment, and apartments and condos, the area is a true "walk-about" community for residents. They can stroll over to shop at the city's first Tiffany & Co., dine at The Cheesecake Factory or take a walk in the two acre park. More than 1 million people came within the first two weeks of the community's May opening to see the spectacle: 74 shops, a dancing musical fountain and light show, an 18-screen theater and 338 high-end luxury apartments and condos. Created by the "reigning king of mega malls," Rick Caruso, CEO of Los Angelesbased Caruso Affiliated, The Americana looks to recreate the glamour, nostalgia and history of great cities like Boston and New Orleans.

"It transports people to another era and reminds them of classic American towns and historic shipping districts," Caruso said. It was a long time coming. The project took a decade to complete with a protracted court battle with General Growth Properties, which owns the mid-tier Glendale Galleria mall next door. In the end, the owners of the Galleria were ordered to pay $89 million for unfair business practices in trying to derail the project. "It was absolutely worth it," said Caruso, who learned about corporate court battles at his father's knee. Henry "Hank" Caruso, founder of Dollar Rent A Car, took on the three largest car rental companies in court in the 1970s to stop discrimination against smaller companies vying for airport locations. Today, Rick Caruso is his own force. He became a household name in 2002 in Los Angeles after opening The Grove, a regional open-air retail project that draws more than 18 million visitors a year.

Record Breaking

"Caruso-Style" environments mix retail, architecture, parks, fountains, promenades, plazas and now residential to offer places to gather and a sense of community that Americans crave, Caruso said. The Americana is Caruso's biggest yet, and the first with a residential component-apartments called The Residences and condominiums called Excelsior. It celebrated one of the largest retail center opening parties ever in Southern California on May 2, 2008, with 2,000 guests, including Gov. Arnold Schwarzenegger. Wolfgang Puck catered. Jay Leno emceed. Tony Bennett, the Four Tops and The Temptations were among the performers. Ninety percent of the 475,000 square feet of retail was preleased. Retail store managers rushed to replace inventories at stores like Armani, Kate Spade, Cole Haan and Juicy Couture. The Cheesecake Factory reported one of the best weekend grand openings in the chain's history. Lacoste Chairman Robert Siegel announced that the store exceeded all expectations for sales. Apartment leasing was on track with projections with more than 30 percent of the 238 units leased in the first two months, said Jennifer Gordon, Caruso's Vice President of Public Relations and Special Events. Within six months, occupancy was at approximately 60 percent. To promote leases, the company reduced lease prices slightly on some rentals and offered incentives inluding a significant reduction of the security deposit if residents moved in before January 2009. "The project is doing extremely well and the apartments are leasing a little ahead of plan," Caruso said. "We have reset rents in the region. We're probably 20 percent above what rents are in Burbank, Pasadena and Glendale."

The company expects full occupancy this year and is confident it will outshine other retail and residential projects being built in the region, said Paul Kurzawa, Executive Vice President of Operations.

"Consumers will choose where they want to live," Kurzawa said. "The Americana at Brand stands alone. We have a much stronger amenity package than any other community in the greater Los Angeles area."

A View From Above

Seamless architectural design and landscaping give the project a timeless feel. Moving art, music, an outdoor crystal chandelier and a massive elevator shaft with exposed steel beams beckon residents and visitors.

The apartments and condos sit three and four stories high atop the retail with views of downtown Los Angeles and the San Gabriel Mountains. There are 51 different floor plans. One has six balconies. "We didn't want to build these crackerjack boxes and have everything the same," Caruso said. "We wanted to have enough uniqueness that if you visit your neighbor there is an actual individuality to it. And people have fallen in love with it." The Residences Apartments target Baby Boomers and others who want to live near work and recreation areas. Glendale police and fire fighters receive a 10 percent reduction from base rents on one-bedrooms. Family and children's activities attract a varied clientele.

Jan and Fred Cuevas were among the first renters. They wanted "a nice place" close to work. They like the personalized concierge service and the concerts on the weekends. "We are empty nesters so being close to shopping and dining is important," Jan Cuevas said. "We wanted a place that was a delight to entertain our friends."

Residents live like guests at a five-star resort. A one-call service to the front desk is available for room and poolside meals, wake-up calls, car washes and oil changes, personal shopping, party planning, gift wrapping and even piano tuning. Entertainment and concerts are held in a two-acre publicprivate park. Other amenities include a great room for entertaining, billiards and big screen movies, cabanas at poolside and a state-of-the-art gym with steam rooms.

"It really redefines what we call a neighborhood," Kurzawa said. "Residents really feel like they are in a different environment. It's not just the architecture and high-level shops; it's everything from landscaping to the uniforms of the employees that really creates that sense of luxury. That's what the entire Caruso team has worked so hard to create."

In recognition of the project, the California Apartment Association- Los Angeles named The Residences a 2008 Signature Property award winner. Peers vote on new communities that "set the standard for all that come, provide new ideas and redefine the skyline." Winning Formula in a Losing Economy The Americana is transforming downtown Glendale, a city that had declined over many years with little in the way of new retail or restaurants.

Home to John Wayne, Baskin-Robbins and Fountain Lawn Memorial, the city is benefiting from the new sales taxes. Retailers along Brand Boulevard continue to see more activity, especially on weekends.

The Galleria mall also is benefiting, said Caruso, who has moved on to other battles and projects, including the renovation of the century-old Miramar Hotel near Santa Barbara and a residential and retail lifestyle center, the Shops at Santa Anita, next to the historic Santa Anita Park racetrack in Arcadia, Calif. Although retail everywhere is feeling the economy, Caruso Affiliated retail projects are leasing at 100 percent, Caruso said. So what is Caruso's formula? Target upscale renters in dense urban areas, pre-lease 90 percent of the retail and bring the right clients in.

Caruso also actively encourages community input with every project.

"We build for a lifetime," said Caruso, who announced in November that he would not run for the Los Angeles mayor's seat as predicted, and instead accepted the governor's appointment to the joint state and city commission that oversees management of the Memorial Coliseum.. "The economy always has ups and downs. It always has. It always will. It's like building an airplane: You don't build for the calm weather. You've got to plan for turbulence."

Victoria Harker is a freelance writer in Phoenix.