la Frontera In the News

Austin American-Statesman

May 8, 2004

Cousins Properties joins deal for Bee Cave mall

National firm will work with local developer Milam on Hill Country Galleria

by Shonda Novak, American-Statesman Staff

Cousins Properties Inc., a major national commercial developer, is teaming with Chris Milam to help develop the $250 million upscale Hill Country Galleria mall that Milam has proposed building in the Village of Bee Cave west of Austin.

Milam said Cousins, an Atlanta-based real estate investment trust, has signed a preliminary agreement to help finance the project and to recruit tenants for its 1 million square feet of retail space.

Cousins has high-end retailers such as Saks Fifth Avenue, Williams-Sonoma, Talbots and Ann Taylor in some of the 2.6 million square feet of retail projects it has at least part-ownership in in five states.

The deal comes as Cousins seeks to increase its retail presence nationally and in Texas, including the Austin area, where Cousins is on the move.

Locally, Cousins will be competing with the nation's largest mall developer, Simon Property Group Inc. Simon owns or has an interest in all the regional malls in Central Texas and has recently solidified its stronghold by teaming with local developers on existing and planned retail projects.

Although a growing player in the retail scene, Cousins mostly focuses on office space development. Locally, Cousins is best known as the developer of the 33-story Frost Bank Tower in downtown Austin. It also has office developments in Atlanta, Miami and San Francisco.

But as office development opportunities have shriveled during the economic downturn of the past three years, "retail is a growing part of our company," said Matt Gove, a Cousins spokesman in Atlanta.

Cousins already has a contract to buy 60 acres of La Frontera, a 330-acre commercial development in Williamson County. Cousins wants to develop an upscale outdoor shopping center there similar to its six projects in other states that Cousins refers to as The Avenues. Cousins does not yet have a timetable on when construction might start, Gove said.

"We won't be able to move forward until we have a certain level of commitment from retailers," Gove said.

Gove said it's also too early to discuss plans for the Bee Cave retail project, including whether it will be an Avenue project.

The firm also recently hired Charlie Quisenberry, a veteran retail broker formerly with mall developer Rouse Co., to head its new retail division in Texas. The Texas office, which is in the Frost Tower, is only Cousins' second regional retail office.

Local developers and brokers said Quisenberry's hiring signals a strong commitment on Cousins' part to be a major player in the Texas retail market.

"They've done some very successful specialty retail centers in other parts of the country," said Rodger Anderson, president of retail brokerage firm UCR-Austin.