Federal Realty Buys The Summit in Birmingham for $508 Million, and the Tenant List Still Has Room to Grow

Federal Realty has bought The Summit, Birmingham's top open-air center, for $508 million. The 870,000-square-foot property at I-459 and U.S. 280 draws nearly 9 million visits a year and had never changed hands since opening in 1997. The seller is Bayer Properties, owned by Centennial since 2022.

The Summit has more than 110 tenants, including Apple, Trader Joe's, RH, Sephora, Aritzia and Reformation. More than 30 run their only Alabama store there. It is 92% leased. Saks Fifth Avenue, an anchor since 2001, closed this spring.

Federal expects the deal to add to earnings right away and sees rents it can raise over five years. It follows last year's $153.3 million purchase of Village Pointe in Omaha. The playbook is the same: buy the center that already wins its market, then improve the mix. "Opportunities to buy truly irreplaceable, dominant assets like The Summit don't come along often," CEO Don Wood said.

Brandmarch puts median household income within 5 miles at $109,434, with 68% of adults holding a bachelor's degree. Within a 10-minute drive, the daytime population of 36,000 far outnumbers the 21,000 residents, thanks to the offices along U.S. 280. Widen to 10 miles and median income falls to about $73,000, so the core trade area is far wealthier than the metro around it.

The shoppers are established and affluent. Prosperous Professionals make up 42% of households within 10 minutes, Culturally Rich Achievers 33% and Young Professionals 22%. They buy quality, pay full price for brands they trust, and treat shopping as a day out. The older affluent households shop for themselves and their grandkids. The younger professionals found many of their favorite brands online first and now want to see them in person.

Brandmarch's top matches for The Summit have one thing in common: almost none are in Alabama. For most, the nearest store is 130 to 140 miles away. Five stand out.

Rothy's scored 95, the best fit in the Birmingham area by a wide margin. Its small stores of 1,200 to 3,000 square feet would sit easily near Aritzia or Reformation. Its fleet's median household income of about $105,000 is right in line with The Summit's.

LEGO scored 94. It lists Apple and Sephora as preferred co-tenants, and The Summit has both. With a quarter of nearby households raising kids and a 100-mile draw, it would bring families in from across the state.

Vineyard Vines scored 94, with the strongest co-tenancy score of the group. Its preppy, family-oriented customer lives in Mountain Brook and Vestavia Hills, and the brand names Nashville and Charleston as target markets.

J.Crew scored 89. It once had a store at The Summit and has none in Alabama today. Its stores sit in trade areas with a median income of about $114,000, a near match. Its 5,000 to 10,000 square foot box could help fill larger space as Federal reworks the center.

Faherty scored 85. Its stores sit in the most affluent trade areas of the five, and it would help fix a real gap. The Summit has 26 women's apparel brands and only four men's.

Untuckit, Buck Mason, Le Labo, Jo Malone London, Blue Nile and Tag Heuer also scored well, and none has an Alabama store. Men's, fragrance and fine jewelry are the clearest openings.

The empty Saks box is Federal's first test, and a space that size could house several of these brands at once. Tenants up for renewal should expect tougher talks. For brands, a new owner with a national leasing team means the best spaces will go to whoever is ready first. For now, the door is open.

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