Crossroads at a Crossroads
Author: Anonymous
When John Genovese, a senior vice president with Macerich Company, spoke to Boulder Tomorrow members in late August, the surface had barely been scratched on the redevelopment complexities for Crossroads Mall.
More than 1200 individuals had participated in the Community Consortium project coordinated by the City of Boulder, "visions" were rampant, but financing plans were yet to be developed. Dillards had just stepped forward with an interest in becoming the fourth anchor, and the project had been broken into two phases in an effort to speed the approval process and help ink the Dillards lease.
Since then, the plot's thickened. The new Sears opened to great fanfare and has enjoyed high sales-to-square footage ever since. The height exemption squeaked through a citywide vote, and the May Company, parent to Foleys, exercised its veto over Dillards, throwing yet another monkey wrench into the redevelopment efforts.
All in a days work for the folks at Macerich? Not really. According to Genovese, there's been nothing ordinary about this project for the country's sixth largest mall owner.
"We have 46 properties in 18 states, and we've never encountered anything quite like what we're experiencing here," Genovese said.
In a recent meeting with a group of Boulder business leaders, Genovese and Macerich local Mike Busenhart talked about impending competition, the reasons for public financing, and the numerous options available for the 65-acre complex.
"The shopping center industry has changed dramatically since the 1950s, when shopping malls were built on vacant parcels of land on the outskirts of a community to spur development and growth," explained Genovese. Today the only way for a new shopping center to succeed is to take market share away from existing retail. That's what we'll see with FlatIron Crossing in Broomfield," he said.
In theory, a quick approval by the City and a fast track construction schedule could get Crossroads renovated before the new Broomfield mall opens. This, according to Genovese, would help keep locals shopping locally, establishing patterns that retail experts say are difficult to change.
"Obviously if someone wants to shop at Nordstrom they are going to drive to Broomfield, because currently they're driving to Park Meadows," said Busenhart. "But if we can get our project done first, we will have a much better chance of discouraging routine trips over the mesa."
Competing with FlatIron Crossing and everything that will surround it, including the Omni Hotel and Convention Center, is a tall order that, Macerich officials say, will require a unique concept that includes more than just retail opportunities.
"The citizens of Boulder told us they want some things that are very special. They want hidden parking, mixed use, activities for children, indoor/outdoor environments and restaurants with a view. Retailers get excited about these things, but they also come with a big pricetag," Genovese said.
Although no formal financial proposals are on the table and no deals have been struck, Macerich envisions the Phase 1 and 2 concept to have a $100-200 million cost. Macerich would pay those costs up front in exchange for a piece of increased sales tax revenues that would be rebated back to the company over time using an as yet undetermined formula.
Nationally, public financing for retail or mixed use projects is not a new concept. Larger cities do it all the time. It also is not new to Boulder, where the original Crossroads renovation, Pearl Street Mall, and the 9th and Canyon sites have included public components.
"If Boulder residents don't want to help pay for the special aspects that they've told us they want, that is a decision they have to make. If they want the open space and the mixed use, there's a cost that logically comes from the public side. We can renovate the mall without all the bells and whistles. Our costs and our hassles would be far less, but it won't be what Boulder wants or really what it needs to compete," Genovese said.
The mixed use aspect of Crossroads brings some potential of increased sales tax revenues, as well as real estate taxes, possibly hotel occupancy taxes, and improved aesthetics, bicycle, pedestrian and bus access.
"We're interested in the residential aspects, and obviously office space makes sense on the upper levels of this complex. We'd also love to have a hotel and convention center on the site, which can help keep people from outside coming to Boulder," Genovese said.
If developing a concept mall doesn't fly with city officials or residents, Crossroads by right can fill its existing space with big box or other tenants, like K-Mart and Home Depot, which have both expressed an interest, and call the project done.
"Obviously that isn't as appealing to us," Genovese said, "But some days I sure think it would make my life easier.
