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A former shopping mall near Raleigh-Durham International Airport is set to be transformed into new office space, after two real estate investment companies bought the property in a joint venture.
Equator Capital Management and OCS Capital said on Monday that they had bought the former Morrisville Outlet Mall at 1001 Airport Blvd. and plan to turn the property into an office project called The Factory.
For years, developers have been eyeing the 25-acre property, which has a prime central location near the airport and Research Triangle Park. A group of developers previously wanted to turn the mall into a Chinese cultural center complete with a five-star hotel and retail businesses, but those plans fizzled around 2013.
The redevelopment of the mall is expected to be completed sometime in spring 2020, the companies said, and will create nearly 250,000 square feet of rentable space. It wasn’t immediately clear how much the property sold for.
John MacDonell, of real estate services firm JLL, which will be in charge of marketing the project, said the project’s location will be very attractive to potential tenants.
“Right now, our suburban product is devoid of creative options and this is aiming to bring a creative option directly across from the airport,” MacDonell said in a phone interview. “It is in the bullseye (of the Triangle) and you could attract talent from Durham and Raleigh.”
He added that the plan is to put shovels into the ground as soon as possible, starting with new improvements to landscaping and parking. “We are not going to wait for any leases, we are just going to go,” he said.
The layout of the mall will stay mostly the same, but the facade and the interiors are going to be completely changed. A lot of glasswork and windows will be added to the exterior to create more natural light on the property, MacDonell said.
MacDonell said the hope is that the campus-like feel of the property will be attractive to large tenants.
Large businesses are “coming here all the time and saying ‘I need to take a sizable square footage and need to operate 12 months from now,’” MacDonell said. “If you don’t have a huge block (of space) like this, you can’t attract those users. We see it time and again in this market, if you build it, they will come.”
The purchase means that yet another shopping mall in the Triangle will see big changes. Malls across the Triangle have been targeted for redevelopment in recent months to compete with the changing ways consumers shop and the decline of several big-box retailers.
Several malls that have faced struggles in recent years are now under new ownership, such as Northgate Mall in Durham, which was on the brink of foreclosure; University Place in Chapel Hill and Cary Towne Center. Those new owners all have plans for redevelopment.
And even at the area’s more successful malls, like the Streets at Southpoint in Durham and Crabtree Valley Mall in Raleigh, property owners are contemplating adding new uses to their properties, like apartments and office space.
The Morrisville project will be New York-based Equator Capital Management’s fifth purchase in the area, including Rogers Alley and City Hall Plaza in downtown Durham and several self-storage properties. The architect is Gensler, a firm with offices in Raleigh.