Del Mar Highlands’ $120M answer to One Paseo: Food, brews and views

The newly opened retail attraction One Paseo may be the talk of North County, but its 30-something neighbor will soon birth an addition that has the potential to create an even bigger stir.

The Del Mar Highlands Town Center, the elder outdoor shopping center that looks west across Carmel Valley’s El Camino Real at its flashier rival, is in the process of constructing 120,000 square feet of retail shops at a staggering cost of $120 million. The center’s hook won’t be another boutique fitness studio or local bohemian fashion brand, though you can find those kinds of places if you want them. No, the real draw is Sky Deck.

Sky Deck is a Barcelona-inspired restaurant collective — modeled after El Nacional’s multi-zone culinary gem — that takes over the second story of a new 50,000 square-foot box anchoring the south side of the mall. It’ll open early next year and feature a central cocktail bar surrounded by eight to 10 distinct dining destinations, each separated but connected to the rest of the maritime-themed, slightly rough-around-the-edges space. An elaborate, interior staircase will also take guests up to a third floor, outdoor deck where they can partake in craft beer or hard kombucha while overlooking a tree-filled vista.

“It would have been easy for us to do an urban Target,” said Pat Donahue, chief executive of the real estate investment trust Donahue Schriber, which owns Del Mar Highlands and dozens of other malls across California, Oregon and Washington. “Frankly, you only get so many chances to do a project like this.”

Scott Slater has signed on to do Sky Deck’s central bar. So far, other tenants include Thai Extraordinary, Ambrogio 15, Le Parfait and a Mediterranean concept by Beeside in Del Mar. Upstairs, local purveyors Northern Pine, Rough Draft and Boochcraft have leased the three brewer’s deck stalls. Sky Deck will also sit above a bigger-and-better Jimbo’s Naturally store, which is relocating from its current location at the end of summer.

“We’re taking a big roll of the dice,” said Jeff Silver, whose Rough Draft Brewing Company first opened in Miramar in 2012. This will be his brand’s second satellite tasting room; it’ll be moving into a space across the street from the higher profile Harland Brewing at One Paseo. “It’s totally brand new,” he said of the concept.

Not to be confused for a food hall, the collective is more we-dine-at-one-place than you-grab-a-bite-here and I’ll-grab-something-there, although Donahue said he will introduce an app-based system for food delivery up to the brewer’s deck. Still, the shared space should create ample people watching opportunities. Plus, dinner crowds don’t want to fight with other groups for table space, Donahue said.

If done right, Sky Deck will give the Highlands Town Center something that’s always been just out of reach for the family friendly marketplace originally built in the late 1980s: A lively evening scene. It may even pump up the volume on Carmel Valley’s somewhat sleepy food and beverage scene.

“I think it’s a smart plan,” said Miro Copic, a marketing professor at San Diego State University. “It’s going to attract a different kind of customer and probably a younger type of consumer.”

The plan came together as Donahue’s company considered how best to serve a growing Carmel Valley population of residents and workers. Across the street at One Paseo, Kilroy Realty is getting ready to introduce 608 luxury residential units along with 280,000 square feet of new office space. There’s also a splashy 125,000 square-foot Alexandria office project, called Townsgate, slated for the corner of El Camino Real and Townsgate Drive, just a few steps walk away from the future Sky Deck site.

Of course, Donahue Schriber also weighed the success of its previous improvements to the center, which from 2010 to 2013 increased parking, introduced elevated food options and added a fancy cineplex. That mini overhaul saw mall sales shoot up by $100 per square foot to $750 per square foot, Donahue said. In retail terms, that makes the center a money-making machine.

“We gave the customer something they wanted more of, but we also parked it,” he said.

It would be a bad business decision not to repeat the same formula, albeit on a much grander scale, the thinking goes — especially since the land entitlement for the Highlands property allows for the additional retail space. That’s not to the say the $120 million investment is without risk. Economists sometimes worry that an economic slowdown is around the corner. And the region’s food options have seemingly exploded over night.

“When you have this new cluster of restaurants that haven’t established an identity, you may see ... that they don’t get enough time to stick,” Copic said.

But, at least in Donahue’s eyes, this mall is special and worth the wager.

“I have 65 shopping centers, none of them are Del Mar Highlands Town Center,” he said.