One of new CenterCal Properties COO Paul Kurzawa’s primary goals is to launch the company’s third-party redevelopment business. Kurzawa, who joined CenterCal last November, is certainly up to the task. He brings an extensive background in both commercial real estate and entertainment via leadership positions with Blackstone/Equity Office, DreamWorks, Caruso and Unibail-Rodamco-Westfield. He has been directly involved in the development of iconic projects like Fashion Valley in San Diego, Westfield Century City in Los Angeles, Westfield Valley Fair in Silicon Valley and The Americana at Brand in Glendale, California, as well as Willis Tower in Chicago. Most recently, Kurzawa was executive vice president and director of operations for URW in Los Angeles. Commerce + Communities Today contributing editor Ben Johnson spoke with Kurzawa about mixed-use redevelopments and CenterCal’s new division.
CenterCal is a boutique firm that over the past 20 years has developed and redeveloped its own retail and more recently mixed-use projects. What’s so pivotal about mixed-use these days?
The most successful developers, I’ve learned, are the ones that tap into how you make a connection with your guests — whether it is a retail shopper, a resident or an office worker — and really find a way to humanize the places that we create. [CenterCal has] done such a fantastic job of creating really fantastic places and experiences that people want to go to. They want to stay there. They want to enjoy with their family and friends, and in doing so, people stay longer, they spend more and that makes the effort a lot more productive. More important, you are creating places that generally make people happy and feel good, and it is just kind of a snowball effect. When you hit that secret sauce, it just builds upon itself. Success for me is [using] that DNA that [co-founders Fred Bruning, who is chair, and Jean Paul Wardy, who is CEO] have built to grow our pipeline of opportunities to reach out to other communities and other areas and create some new value opportunity.
Why is this the time to start a third-party redevelopment division?
There is a lot of demand right now from owners that have existing real estate that needs a new perspective. They need a new vision. They’re looking for perhaps some new and in some respects unconventional ways to realize value creation through redevelopment. As the real estate market continues to evolve and the lines between different asset classes blur for projects, it is the perfect time for CenterCal to really capitalize on its experience and, frankly, the product it creates to offer those services for institutional investors and different ownership across the nation.
A mix of uses was a big part of CenterCal’s recent redevelopment of The Village at Totem Lake in Kirkland, Washington. Is mixed-use becoming a larger part of conversations with clients?
It has already started to become more important and will continue to do so. There are two key components that play here. People have more flexibility in terms of where they work. That provides an opportunity for a lot of real estate to be reprogrammed to become more central in town centers that are rooted in more of a mixed-use mindset. Secondly, there is more of an evolution of community and neighborhood centers bringing in additional uses because that is how people live. What they’re looking for from a use standpoint is evolving, and that will drive some of the demand. Depending on the city, in the more urban and semi-urban areas, it becomes more important as transport and traffic congestion become more of an issue.
What services will you offer?
What is typically found in most firms that offer similar services, and that ranges from property management, leasing, accounting, marketing and creative design. But the one big difference with CenterCal is that because we are a full-service, vertically integrated organization, we offer development construction and tenant coordination services. There are very few boutique, private firms such as ours that offer all of those services and that are mixed-use experts. We have a real niche.
CenterCal has 20 properties in four states. A third-party redevelopment division is a big opportunity to expand. Have you gotten interest?
We are getting strong inquiries from ownership looking for new opportunities to unlock value. And these aren’t necessarily assets that are distressed; these are assets that in some respects are very stable and very successful. We have shown them some new ideas and some new opportunities that they perhaps hadn’t appreciated before. It’s been fun for us because we have been able to look at projects outside the geographical footprint in our portfolio, and it has given us an opportunity to tap into some new markets and to look at some new assets.