A rendering of the new development at Phipps Plaza.

The planned Phipps Plaza expansion is ushering in the “next generation” of malls by bringing a hotel, Robin Suggs, who manages its sister mall Lenox Square, said at a recent Buckhead Business Association breakfast.

Simon Property Group, which owns both malls, announced in November its plans to expand Phipps Plaza, located at 3500 Peachtree Road, with a Nobu hotel and restaurant, expansive fitness center and office tower. The expansion will be built where the current Belk store is located.

“When opportunity arises such as this where you can redevelop an anchor store, hotels have proven a very good investment,” Suggs said.

Hotels work well with malls because they bring visitors into the mall ecosystem and they are more likely to spend more time at the mall, she said.

“You’re bringing in the visitor and affording them the opportunity to spend as much time as the want in the shopping environment,” Suggs said.

Belk will be demolished mid-2018 and the expansion will be opened in phases throughout 2020, she said. One of the city’s fire stations is located near the Belk and will be relocated closer to the center of the mall, Suggs said.

The overall trend of increased residential properties and hotels in the Buckhead area also has helped draw traffic to the malls, Suggs said. Rates to rent space in both malls are among the top 10 percent in the country, she said.

Malls across the country are bringing in more entertainment venues, including restaurant and video arcade Dave & Buster’s, concert venues and movie theaters to compliment the retail section, Suggs said. Phipps plans to join this trend by adding a raised stage in a planned outdoor common area that will be built during the expansion, Suggs said.

“The trend in the shopping center business is to develop and experiential opportunity — a reason for you to come to the mall and spend time with us,” she said. “It’s the wave of what’s to come.”

The stage is planned to be used to host concerts during the lunch hour or after business hours and for business events, she said.

Despite the decrease in malls’ popularity and the fact that several have closed across the country in recent years, Suggs said both Lenox Square and Phipps Plaza are performing well. She said she still believes people prefer to buy things at physical locations.

“The majority of people want to see it, want to feel it, want to try it on and be around other people,”  she said.

Even retailers that first existed only online are beginning to move into malls, including Amazon, which has opened a kiosk in Lenox Square, Suggs said.

In response to a question about how this expansion may cause an increase in traffic, especially in Wieuca Road and Phipps Boulevard intersection, Suggs said several initiatives are in the works.

Suggs works closely on these projects through her positions with the Buckhead Community Improvement District and Livable Buckhead.

In addition to other traffic calming measures, a roundabout has been proposed for the Wieuca/Phipps intersection. It has been with some pushback from the community and may not ultimately be the chosen project.

“I’m not sure we’ll finally land on the roundabout, but there are initiatives in place because everybody recognizes there is tremendous gridlock in that particular area,” Suggs said.

The malls have just as much to lose as residents would if traffic worsens because increased gridlock could decrease visitors to the malls, Suggs said.

“If we are in gridlocked, we’re all feeling the pain,” she said.