SOUTHEAST SNAPSHOT, APRIL 2008

Louisville Retail Market

During the past 12 months, the Louisville retail market has continued to experience modest growth in a community that has generally been devoid of the broader economic swings seen in some neighboring cities. With a shortage of quality infill sites, new retail growth has been primarily focused around the city’s outer belt line, the Gene Snyder Freeway.  The bulk of that retail growth has been concentrated in the eastern segment of the trade area. The Louisville marketplace is divided into St. Matthews, Springhurst, Southeast, Preston and Dixie Highway.

Recently, redevelopment has been more prevalent than new construction with several properties enjoying a refurbishment. The St. Matthews area, traditionally the city’s retail hub, has seen a redevelopment of four prominent centers. Owned by General Growth, Oxmoor Mall continues to evolve with the addition of Z Gallerie, Sephora and BJ’s Restaurant. The Mall St. Matthews relocated and expanded Victoria’s Secret and has plans to re-tenant the former Dillard’s location, which offers outstanding frontage to Shelbyville Road. Directly across from Mall St. Matthews, Dixie Associates is in the process of completing a facade refurbishment that will add Staples, K&G Fashions and a renovated Steinmart. Immediately contiguous to the Mall St. Matthews, Bluegrass Manor has added Urban Active, a 50,000-square-foot state of the art health club. Also new in the St. Matthews market, Hobby Lobby is adding their third location in Louisville and backfilling a former 57,000-square-foot grocery location at Breckinridge Lane and the Watterson Expressway, the city’s inner belt line.

The eastern segment of the market has experienced the majority of the recent retail development as well as the most proposed growth. The Springhurst trade area in the northeastern part of the city has two projects in the planning stages. Chamberlain Pointe is currently under construction and will offer 112,000 square feet of mixed-use retail and office at the southeast corner of Highway 22 and Gene Snyder Freeway. Immediately across Highway 22, the McMahan Group is proposing a 200,000-square-foot lifestyle center expansion of Old Brownsboro Crossing.

Also in the eastern segment, Wal-Mart is under construction for one of its two planned supercenters for spring. Developed by Hagan Properties, the eastern location at Shelbyville Road and Gene Snyder Freeway is the redevelopment of a former Bigg’s Hypermarket and includes several new shadow centers as well as an opportunity for an additional anchor. Only 1 mile west, Wal-Mart has opened a neighborhood grocery at the corner of Shelbyville Road and Blankenbaker Parkway.  Additionally, Nicklies Development has helped Kroger expand an already dominant presence in eastern Louisville with a 65,000-square-foot store at Taylorsville Road and Gene Snyder Freeway. 

In the southeast part of the Louisville trade area, at Gene Snyder Freeway and Bardstown Road, three new retail developments have been announced and are in various stages of planning. The largest is a 350,000-square-foot power center by The Sembler Company. Immediately across from the Sembler site, Lexington developer Pat Madden is proposing a 100,000-square-foot project to be anchored by a national apparel retailer.  Finally, the Louisville based Barrister Commercial Group is proposing a 200,000-square-foot retail center. All three developments are dependent on successfully re-zoning their locations.

The Preston trade area is in the southern segment of the market and features the 1.12 million-square-foot Jefferson Mall. CBL & Associates has recently expanded the mall to add an Old Navy and Linens ‘n Things to the tenant mix. Locally based Jefferson Development Group has announced plans for an $85 million, 420,000-square-foot lifestyle center to begin construction immediately contiguous to the mall. While still in the early planning stages, the new development will feature a variety of upscale retail stores in a towncenter format.

Retail in the western part of the city is located predominantly along the Dixie Highway corridor. Three new projects are under way including the market’s fourth Wal-Mart Neighborhood grocery. Fletcher Bright Company is putting the final touches on a new Wal-Mart Supercenter location on the Greenbelt Highway at Lower Hunter Trace, less than 3 miles north of the aforementioned grocery location. The project will include approximately 40,000 square feet of shop space and several outparcels. Kroger has also been active in the area with a renovation of their Southland Terrace store on north Dixie, a proposed expansion of its central Dixie location and a relocation and expansion of their store on south Dixie. 

While retail development in the Louisville market has been relatively quiet in the past few years, six new projects promise to reinvigorate the landscape. Traditionally insulated from severe market fluctuations, expectations are that Louisville’s retail growth will continue to be consistent and strong in the foreseeable future.  

— Kevin Schreiber is with The Shopping Center Group in Louisville, Kentucky.

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