Elk Grove News

March 20, 2013

Elk Grove pushes for construction to resume on long-stalled Promenade shopping mall

Elk Grove's retail picture appears to be regaining some lost vibrancy as stores move into central commercial corridors.

Elk Grove's retail picture appears to be regaining some lost vibrancy as stores move into central commercial corridors.

But less than four miles away, an empty field houses the lifeless hulk of an unrealized regional mall.

A concrete pad and exposed metal form the skeleton of Elk Grove Promenade, an albatross for a city billing itself as a fresh-faced hub of Northern California growth.

Construction on the mall halted in 2008 as the economy soured, and the city has not seen any recent movement on the project.

"There's not a ton to report right now," said Elk Grove Mayor Gary Davis, who has made it a priority to get the mall back on track.

Davis said a proposed major-league soccer stadium near Elk Grove Promenade could motivate the mall's owners to complete construction and fill the stores with tenants.

The owners, Howard Hughes Corp., released a statement Tuesday saying it "continues to work through the development process" and is "actively promoting the project to potential retailers."

The Dallas-based company, however, doesn't have a timeline for moving forward, said the statement from Caryn Statman Kboudi, vice president of marketing for HHC.

"You're welcome to check back in a couple months," she told The Bee.

While shopping centers on Laguna and Elk Grove boulevards have landed some national chains, such as the footwear retailer DSW and Hobby Lobby, city officials are frustrated with the lack of progress at the Promenade.

When the shopping mall broke ground in 2007 west of Highway 99 near Kammerer Road, the 1.1 million-square-foot center was expected to open in November 2008. At the time, developers said Elk Grove Promenade would be anchored by a movie theater and three department stores: Macy's, JCPenney and Target.

Construction was under way when the recession hit. By the end of 2008, building activity at Promenade stopped, and in the spring of 2009, the mall's former developer, General Growth Properties, filed for bankruptcy protection. Howard Hughes Corp. took over ownership.

The mall site has remained dormant for more than four years, with HHC pointing to a downturn in the city's housing market.

"Elk Grove was once one of the U.S.'s fastest-growing cities, but its growth stalled during the recession with the collapse of the housing market," says HHC's web page dedicated to Elk Grove Promenade.

Davis said he thinks HHC should change up its marketing strategy to move forward.

"I say if they build it, they'll sign retailers. From their perspective, they say they want letters of intent, then they will build it," he said.

The mayor said he's "relatively confident" HHC isn't interested in selling the unfinished mall, because he has "introduced them to several potential buyers over the last few years and they're not interested."

Randy Starbuck, Elk Grove's economic development director, said he accompanied HHC marketing representatives to the International Council of Shopping Centers in Las Vegas last year in an effort to keep them on task. He called the trip "productive," but wouldn't divulge the names of any potential tenants.

Starbuck said he is concentrating on landing anchor tenants for the mall.

Davis contends that if the mall had been completed on schedule, it would be making a profit now.

"We're looking at this as an opportunity to build a more economically sustainable model," Davis said. "The mall can be reconfigured to capture some of the more current retail trends, including more consumers shopping online. It could even have a smaller footprint."

Lynn Wheat, an outspoken critic of Elk Grove's growth policies in the past, said the unfinished mall points to a slow economic recovery. She believes the city should be more cautious when looking at expanding development.

"HHC is about making money, and they're not going to build something that doesn't make money," said Wheat, who ran against Davis in the November mayoral election. "If they believed the mall was viable now, they would be completing it."

Call The Bee's Anne Gonzales, (916) 321-1049.

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