North Palm Beach’s Crystal Tree Plaza complex set for renovation

Crystal Tree Plaza, a 35-year-old shopping center and office building on U.S. 1 in the heart of North Palm Beach, is set to get a multi-million dollar face lift — a transformation the plaza’s new owner says is part of a renaissance that’s drawing new high-end homes and businesses to the area.

But some local business owners with shops in the complex fear they mightmay be forced to move because of the higher rents they say they’ll have to pay as a result redevelopment effort. At least one longtime tenant — The Patio Shoppe — has already moved out of the plaza and reopened its doors about 3 miles away at Legacy Place in Palm Beach Gardens.

The 120,000-square-foot plaza, which would be renamed Crystal Cove Commons under the redevelopment proposal, was bought in October by Pearland RJR, an entity tied to the California-based Black Lion Investment Group. Robert Rivani, Black Lion’s president, said the investment group plans to turn the property into a “full-scale” retail and luxury “outdoor development.”

“What we are really focusing on is to provide a lifestyle experience,” Rivani said. “The game plan is definitely an upper scale, luxury retail service and restaurant property.”

The plaza is across the street from the Kolter Group’s Water Club, a three-tower complex at 1280 U.S. 1 with views overlooking the Intracoastal Waterway and Singer Island. The 192-luxury condos range in price from $900,000 to more than $3 million.

Rivani also points to the nearby the North Palm Beach Country Club, where a new, $15 million clubhouse is planned. Carl Von Luger Steak & Seafood, a restaurant in the style of the renowned Peter Luger Steak House of New York, has signed a deal with North Palm Beach to open two restaurants in the clubhouse. The naming of the proposed steak house, however, is being challenged by principals at Peter Luger.

“Highway 1 is changing,” Rivani said. “The real driver of that was the success of the Water Club condos.”

Sales at the Water Club towers have been strong. Of the 162 finished units, there have been 134 closings, a Kolter official told The Palm Beach Post earlier this month.

But even with the new development, some of Crystal Tree’s tenants question whether there will be enough demand in the area to support the high-end retail Black Lion hopes to bring to the plaza.

The retail market is already struggling from the rise of online sales. Several up-sale retailers including Michael Kors, Macy’s and BCBG Maxazria plan to close stores.

Some of Crystal Tree’s tenants say they have been warned their rents could double or triple as leases come due. Some argue the higher rental fees are designed to push out small business owners, several of whom have had locations in the plaza for decades.

The plaza’s new owner is “really not in tune with Palm Beach County,”said Dave Clabaugh, the controller at True Treasures, a Consigned Furniture & Home Décor shop that has been in the plaza for 27 years.

A month after buying the property, Pearland filed suit to evict True Treasures, arguing among other things, that the home décor shop was violating the terms of its lease by unloading furniture in the plaza’s common areas.

Clabaugh said True Treasures has always brought items through the front of the store, adding that the back door is not wide enough to fit furniture through.

“We have been an anchor tenant here for years,” Clabaugh said. Rivani “doesn’t know us,” he added.

Clabaugh said the shop’s owner doesn’t want to move out of the plaza, and plans to fight the eviction.

Kathy Vigneau, owner of a small needlepoint shop in the plaza, said she is also hoping to stay. Needlepoint Alley has been at Crytal Tree for nearly 17 years, and recently went through a major renovation that involved moving to a smaller, but more functional unit in the plaza.

“I am very happy here,” Vigneau said. “My customers know where I am. It’s a very comfortable setting.”

Cod and Capers, a seafood market and cafe in the plaza, has welcomed the change in ownership, saying Rivani’s group has been “nothing but accommodating” and that previous landlords did not do a good job maintaining the property.

Rebel Cook, a commercial real estate broker based in Jupiter, called Black Lion’s plan for the plaza “ambitious.”

“Historically that center has been small local retailers,” Cook said. “The rental market is a market that you have to be very careful with as far as what you are going to charge. Retail across the board is dwindling.”

Cook agrees the plaza needs to be updated, but she said it is different from others in the area because it includes a large office building.

“The office part of that market is still very quiet,” Cook said.

Rivani said the redevelopment plan must still be approved by North Palm Beach officials, and that is expected to take about 30 to 45 days to complete. If approved, upgrades at the plaza could be completed by early next year, he added.

Rivani said the property was a foreclosure at one time, adding that the rental rates might not have been in line with similar plazas.

A new “fitness use” has already signed to move into the 7,000-square-foot space vacated by The Patio Shoppe, he said.

“The transformation has already begun,” Rivani said.

Caroline Levet, owner of So Crafty, a craft store in the plaza that offers adult classes and summer camp programs, said her lease is up in September, and she hasn’t been told whether it will be renewed.

As a result, she plans to move her shop, and has already started looking for other rental space nearby. But the prices are as much as double what she is paying at Crystal Tree, she said.

“It is not going to be the same price, that is for sure,” said Levet, who opened her store in the plaza three years ago. “I might have to find something smaller.”

Crystal Tree’s previous owners didn’t do a lot of maintenance on the property, which helped keep rental rates low, Levet said.

This week, crews began doing repair work on sections of the roof at the plaza, she added.

“It is hard because I have to find a place and it is going to be more expensive because the deal was quite good here,” Levet said.

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