University Mall empties as retailers wait for Summit.
The 574,248-SF retail center at 300 S. University Ave. is now home to more than a dozen darkened storefronts.
Officials at Simon Property Group Inc. aren't saying what the current occupancy rate is, but a walk-through indicates about a third of the mall is unoccupied.
Rob Rector, manager of McCain and University malls, couldn't be reached for comment. Lisa Meyer, local marketing director, referred questions to the Indianapolis home office, which didn't respond.
At the beginning of last year, Simon Property pegged the occupancy of University Mall at 95 percent, but the exodus of Montgomery Ward & Co. in the first quarter of 2001 emptied a fourth of the mall's leasable space. An April 2001 report by the Urban Land Institute of Washington, D.C., said 40 percent of the mall was vacant. (See related story below.)
Tenants in the project aren't getting any information from the company about it future plans for the project. Some were as tight-lipped as the mall manager, but others weren't.
"I know they're doing some fixing up," said Jim Stone, general manager of Franke's Cafeteria. "They have been making repairs to the roof. But I don't know what's going on with the empty space.
"We want to stay here, but they're going to have to get after it. The mall to me looks pitiful because of all the stores closed."
Stone said Franke's quickly felt the loss of mall traffic caused by the shutdown of Montgomery Ward.
"It affected us a tremendous amount -- about 5 percent. We still have a good lunch business, but we don't have much of a dinner crowd. It's like a ghost town here at night.
David Bowser, district manager for The Shoe Department, said Simon Property hasn't shared any plans concerning new tenants or redevelopment of the property.
"All I can tell you is we have a three-year lease, and there's been no indication from Simon Property of any change," he said.
Some mall businessmen said Simon Property has made veiled references to an unidentified tenant lined up to fill the void left by Montgomery Ward. They also mentioned that that word was the same months ago.
The hearsay among some mall merchants is that Sears Roebuck & Co. will relocate to the space if the proposed Summit Mall doesn't materialize. The lease on the nearby free-standing Sears location at 600S. University Ave. expires in 2003.
Sears has committed to go into the 1.1 million-SF Summit Mall project if Simon Property can make it happen. But Summit currently is tied up in court after the city board approved the development last April. The case is scheduled for trial Feb. 20-21 in Pulaski County Circuit Court before Judge Mackie Pierce.
The matter landed in court when city officials refused to schedule a special election on the project after opponents gathered enough signatures to force a referendum vote.
City officials didn't dispute opponents had more than enough names to warrant a special election. But they did question whether there was legal precedence to refer a rezoning vote to a special election.
Attorney Nate Coulter of Little Rock, who filed the lawsuit against the city, said the question of legal precedence is only one issue in the dispute. He contends there are at least three administrative problems with the city approving the necessary zoning for the Summit Mall in west Little Rock.
First, the city shouldn't have granted an extension for the planned commercial development a decade ago because the landowner missed the deadline for filing for the extension by about 40 days.
The 95-acre site at the southwest corner of Interstate 430 and Shackleford. Road was originally a mixture of zonings when it was assembled back in 1988.
Second, the ordinance that addressed the planned commercial development specifically addressed mixed-use development of the site. Simon Property's proposal is for retail only.
Third, the city failed to make Simon Property comply with requirements to provide plans to address traffic congestion caused by the project.
The city ordinance in question would require $8 million-$12 million for improving Shackleford Road to be done first before construction of the mall could begin. That cost is to be borne by the developer.
Summit Mall LLC, a Simon Property affiliate that owns the would-be mall site, tried to intervene in the lawsuit. The limited liability company argued that it was misled by the city about the zoning status of the property.
A recent ruling handed down said that claim is fodder for a separate lawsuit and has no bearing on the matter at hand.
The original Summit Mall project called for an $80 million, 925,000-SF mall back in 1988. Alabama developer James W. Wilson Jr. assembled the land for $11 million only to later forfeit the Property in lieu of foreclosure in July 1991 as he weathered financial reversals.
An affiliate of Chemical Bank of New York sold the land to a Simon Property investment group for $6.3 million ($1.50 per SF).
The expansion and renovation of University Mall and Park Plaza in Little Rock was blamed for helping sink the original Summit Mall proposal. Opponents believe the current Summit project will spell the end of the two midtown malls.
Vacated Tenants at University Mall First Level: Second Level: Montgomery Ward Gold Italia Coach House Gifts Waldenbooks Regis Hairstylists Bugle Boy Spencer Gifts Shopping Safari Ace Cobbler Fine Bath & Body Leather Works Jewelry Palace De African Elegance Fins Fangs Feathers & Suit UP Fur Camelot Music
RELATED ARTICLE: Report Suggests New Life for University Mall
THE ADVISORY SERVICES panel report issued in April 2001 by the Urban Land Institute of Washington, D.C., provides an interesting perspective on the shifting retail scene in Little Rock.
The non-profit research and education organization, hired by the city, made its comments as part of a redevelopment plan for midtown Little Rock.
The group suggested the redevelopment of the University Mall property and a suggestion that a 20-screen megaplex movie theater could serve as an anchor.
Here are some excerpts from the study.
"University Mall, operated by the Simon Property Group under a ground lese, is in obvious trouble. The closing of the 142,000-SF Montgomery Ward store virtually ended the viability of the center that was struggling with mediocre sales performance before the closing.
"It is understood that the JCPenney store intends to leave midtown and join Simon's new center, Summit Mall, when that opportunity becomes available within the next five years or so.
"M.M. Cohn would be left as a weak anchor tenant, contributing little to University Mall as a destination.
"Simon has indicated that it will try to fill the Wards vacancy promptly; apparently a Target store is the likely candidate and is being courted.
"The panel's judgment is that adding Target, or a similar large and competent mass retailer, would be an appropriate step in repositioning this center to become a far more energized project.
"Other big-box retailers not already part of the market to the west should be actively sought to replace the other existing but weak or departing anchors.
"Since the small stores, to the extent that they still exist, will no longer properly relate to the big-box retail concept for the anchor tenants and because the configuration of the entire mall will be inappropriate for the types and sizes of small stores to be sought for it, the panel believes it is necessary to remove the existing building and rebuild the mall."
"University Mall suffers from a lack of national tenants, obsolete design, poor maintenance, high vacancy (40 percent), below market rents and low sales ($20 million range)."
"From a supply/demand perspective, regional retail in the Little Rock MSA is balanced: with a regional population of about 584,000, the area can only support the two existing regional retail nodes.
"And it is unlikely that Little Rock's growth will justify a third regional center in the near future since Little Rock's MSA only grew 14 percent in the past decade.
"If it is built, the proposed Summit Mall, which the city approved in April 2001, will upset this supply/demand balance.
"Some have questioned whether it will be built. But even if it is not, the panel believes a new regional mall will be developed somewhere within Little Rock and that it will hurt midtown."
"The panel believes that the clear loser will be the midtown malls for the following reasons:
* Summit Mall will be about three miles from the midtown mall.
* Summit Mall will benefit from the most advanced design and finishes, compared with the 30-year-old midtown malls.
* Dillard's is a partner with Simon Property Group in Summit Mall and will build a 300,000-SF store there-Because Dillard's has more than 284,000 SF in two stores at Park Plaza, the panel believes it is very unlikely that the company will be able to operate profitably the combined 584,000 SF of space at two malls only three miles a part.
Dillard's has not committed to keep open its Park Plaza stores and has adopted a "wait-and-see" approach. This uncertainty created by Park Plaza's only anchor will make it very difficult for Park Plaza to retain its 85 high-quality small stores.
Pushed by a Dillard's closing, these tenants will also be pulled by Simon to Summit Mall.
* The Simon Property Group is the world's largest developer of malls and will use that leverage to attract the current in line tenants (small specialty tenants) at Park Plaza to its new Summit Mall.
Given Simon's leasing ability and the basic retail advantage of Summit Mall will have over Park Plaza because of its greater size (1.1 million SF versus 547,248 SF) and its design, the panel believes many small stores will prefer Summit Mall."
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|Title Annotation:||Little Rock, Arkansas; shopping mall vacancy|
|Comment:||University Mall empties as retailers wait for Summit.(Little Rock, Arkansas; shopping mall vacancy)|
|Date:||Jan 28, 2002|
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