DATE: Thursday, March 27, 1997              TAG: 9703270601
SECTION: BUSINESS                PAGE: D1   EDITION: FINAL 

SOURCE: BY STEPHANIE STOUGHTON, STAFF WRITER 

DATELINE: NORFOLK                           LENGTH:   38 lines

DEAL-MAKERS AIR CONCERNS ABOUT OVERBUILDING

In the midst of a retail explosion, several real estate deal-makers stepped back Wednesday and expressed concern about the impact of Norfolk's MacArthur Center and the advent of massive retailers like Super Kmart.

``Everywhere around the country, malls are in trouble. And we're busy building more,'' said Gerald Divaris, president of Divaris Real Estate Inc. in Virginia Beach.

Divaris was sharply critical of MacArthur Center, an upscale mall expected to open in 1999 in downtown Norfolk.

``This is probably the most ill-conceived project I've even seen in my entire life,'' he said. ``I'm going to hope it will work.''

Divaris was one of six local real estate officials who participated in a panel discussion on retail trends in Hampton Roads. The talks, held at the Chrysler Museum of Art in Norfolk, were a part of a real estate conference.

Among the criticisms were that MacArthur Center would be too large, too expensive for retailers and would particularly hurt Military Circle Mall in Norfolk.

Mike Zarpas of Robinson Sigma Commercial Real Estate Inc. in Norfolk was less critical of MacArthur Center. While acknowledging that the center would likely affect Military Circle's business, he said it was still ``a tremendous opportunity'' for Hampton Roads.

``I think it will be successful,'' Zarpas said.

Real estate officials said they also worried about cutthroat competition in some sectors that could lead to a shakeout, leaving shopping centers with massive, empty buildings.

Divaris said book stores and other sectors of the retail industry have succeeded in the superstore format. But he wonders whether the new gargantuans of retail - Super Kmart and Wal-Mart's superstores - can succeed in mixing grocery products with typical discount goods.

``I think the jury is still out,'' said Divaris.

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