Corinne Verdery may have only taken over as chief executive of Fairfax-based real estate firm Caruso – so-named for founder Rick Caruso – two years ago, but she already has her eyes on the future.

The 30-year commercial real estate veteran said she sees the company expanding outside of the Golden State, as well as a move to more residential projects, on the horizon.

“My goal and vision for the company is that we grow our residential business. What we’ve learned through The Americana and Palisades Village and 8500 Burton Way (a Caruso project with residential units) is people love living with us. They love living in the properties that we’ve created. They love our hospitality,” Verdery said. “I really want to expand the portfolio that way, and we have a significant push to grow residential … that is a big focus of the company.”

In addition to looking at new opportunities, the company is also adding residential units to some of its existing properties.

Sonnet Hui, general manager and vice president of real estate consultancy firm Project Management Advisors, said she is seeing more projects that include both retail and multifamily.

“Retail and residential has a very symbiotic relationship. If you have a fully occupied center with rentals, it makes the retail more successful,” she said.

She added that changes to zoning regulations in some areas have also allowed for more mixed-use developments that include both retail and residential components.

At Caruso, The Commons at Calabasas has been approved for 119 apartments and 15 new shops and restaurants. The Lakes at Thousand Oaks, meanwhile, has been approved for 165 apartment units.

Construction is expected to start on both in 2025.

“California is going through a housing crisis and we’re very happy to do more residential. Every community we operate in needs more housing and we’re happy to be part of that solution for them,” Verdery said.

She said there will be affordable units as well at some of its projects going forward. Today, however, its portfolio offers market-rate and luxury units.

Caruso’s portfolio is currently 80% retail and restaurants and 12% residential but by 2030 is expected to be 19% residential.

Rick Caruso is still involved in the business.

Since stepping down amid a run for mayor, he has taken on the role of founder and executive chair. Verdery said he is still “heavily involved” when it comes to long-term vision and tenant mix, and still enjoys planning what music will play at the fountains at The Grove.

“Under Corinne’s leadership, the past two years have yielded tremendous results for the company relating to new retail and residential development, industry leading consumer ratings, and record engagement levels for Caruso’s Signature loyalty program,” Rick Caruso said in a statement. “I have the utmost confidence in her continued leadership and remain grateful for the many years of commitment she’s demonstrated to us here at Caruso.”

Not shying away from
its retail roots

Caruso is best known for its retail properties including The Grove in Fairfax, Palisades Village in the Pacific Palisades, The Americana at Brand in Glendale and Village at Moorpark.

Despite the difficulties some other shopping centers are having, Caruso has seen double-digit net operating income growth and high occupancy rates. The company also reports 75% higher sales per square foot than the industry average.

“At a time when indoor malls are not doing well, our outdoor retail properties are doing extremely well,” Verdery said. “We are firm believers that if the retail environment is designed and built and operated the right way, retail is an incredible investment.”

She added that programming, hospitality and experiential retail were also big components of that.

The company is also an owner in 20 restaurants at its properties, instead of simply leasing them to others.

“We like owning restaurants on our properties. It’s a way for us to be very close with our customers,” Verdery said. “We find that owning and operating a couple of restaurants on our properties is a good way for us to stay close to the business. And it’s a good way to see what are the people’s wants and what are our communities’ preferences? It’s a way for us to interact with them face to face.”

Verdery said the company has done this through both management contracts and day-to-day involvement in the restaurants.

One big change coming near The Grove is Culver City-based Hackman Capital Partners’ $1 billion expansion of Television City.

Some groups have opposed the project.

“We’re very supportive of the Television City project, I spent the majority of my career in the entertainment industry at Universal and we’re a huge supporter of the industry. We would love to see more sound stages and studios there,” Verdery said. “The issues that we’ve had with the Hackman project is, and we’ve told them this, it’s just about traffic. It’s just about, how are you changing the traffic patterns around The Grove and especially on Grove Drive. There’s still issues there relative to traffic and parking that need to get addressed. But outside of that, we’re very supportive of the industry, and we’d love to see more great things happen there.”

Developing a rewards system

One of the first things Verdery did when she became CEO of the company was launch Caruso Signature, a rewards program spanning all of its verticals.

The program allows people to get “Caruso Coins” by using a credit card connected to the platform. The coins can be used for various rewards at Caruso properties, including its Rosewood Miramar Beach hotel.

For people who live at a Caruso property and pay their rent with a credit card, coins can be earned quickly.

“This is a fully digital program,” Verdery said. “What was important to me is that we bring the whole system of Caruso together.

“We’re not just rewarding our customers,” she added, “but we’re making sure that our customers can take advantage of all of the other properties in the portfolio, and what it also does is allows us to really customize their experience.”

Caruso Signature can also look at where people attending programs go after, which Verdery said can be used to better understand customers.

Expanding outside of L.A.

Looking forward, Verdery said the company would expand outside of the L.A. area.

“Some of the things on the drawing table are in Los Angeles, but another big part of what I would like to do with the company is grow it outside of California,” she said. “I think that the company and the brand are ready for it. Our customers that shop and dine and stay with us at our hotels or live with us have been asking us to please, please, grow outside of California and so we are definitely looking at that.”

Verdery said the company was already looking at opportunities outside of California.

“It’s a priority and focus for the company,” she added.

Verdery said coastal cities and warm weather locations are of particular interest to the company.

“We’re looking at all different locations but we’re really good at outdoor environments and so that automatically says different coastal cities across the U.S. but also our customers and guests travel and also live and come and visit us from all over the country and so we’re really looking at those different locations, but we know how to do wonderful outdoor environments,” she said.

“We’re excited to introduce Caruso to other states and other cities,” she said. “It’s time. I’m also extremely excited to do more residential.

“Our business is continuing to grow at the pace that it’s always grown: in the double digits,” Verdery added. “There’s a lot of wonderful things happening.”