This makes a ton of sense and could be a great catalyst for that area. It's really an extremely desirable location for a large mixed-use project. Maybe even one of the best in the state right now. You have a ton of space to work with and there are minimal to no single-family homes nearby, so you should be able to get some height on the site without drama from neighbors. You are 10-15 minutes from downtown, 15-25 minutes from Atlantic Beach, 10-15 minutes from SJTC, close to the port, and 20-25 minutes to JIA. There is already Lowe's, Home Depot, AMC Regency, Best Bet, Kona Skate Park, and the Arboretum nearby.
With the stadium coming, there is a real opportunity to redevelop the site into a really awesome mixed-use village. Even without transit/BRT, I think there should be a strong opportunity there, but as Marcus said earlier, the TOD aspect could really help take things to the next level.
It's a bummer (and maybe a huge mistake) that Regency wasn't included in the Arlington CRA because I think the City could have leveraged property tax abatements or TIF to really kick start something special there.