THE VIRGINIAN-PILOT
Copyright (c) 1995, Landmark Communications, Inc.
DATE: Sunday, January 29, 1995 TAG: 9501290059
SECTION: LOCAL PAGE: B1 EDITION: FINAL
SOURCE: BY ALEX MARSHALL, STAFF WRITER
LENGTH: Medium: 71 lines
Barely a month before its scheduled ground breaking, a date already delayed once, the proposed MacArthur Center mall only has one of its three anchor stores on board and its developer lacks a full package of financing.
Yet top city officials, from Mayor Paul Fraim to Director of Development Robert Smithwick, say the project is still on track and that they don't expect to delay the construction schedule again.
Still, they acknowledged that Norfolk is on the verge of missing its self-imposed deadlines if the city and the developer do not nail down key aspects of the project soon.
``If things start to happen this month or next, we can still meet the fall 1996 (opening) deadline,'' said David Rice, executive director of the Norfolk Redevelopment and Housing Authority. ``None of this should be interpreted as any enormous glitch. These projects take a long time to put together. That's normal.''
The major holdup continues to be that Federated Department Stores Inc., the chain that merged with R.H. Macy & Co., is still reviewing the plan to put a Macy's in MacArthur Center. Macy's signed a letter of intent before the merger, and now Federated wants the opportunity to sign off on the deal.
The city originally had predicted a December ground breaking. It pushed that back to March after Macy's merger with Federated caused delays.
Although its department stores are generally doing well, Macy's has been in bankruptcy court for more than two years after taking on too much debt in the 1980s.
Until the Macy's deal is hammered out, Fraim said, developer Alexius C. Conroy of Connecticut will not be able to pull together the financing for the project. But Fraim said he expects Federated to sign off on the project soon.
``Hopefully, by the end of the month we will hear that Macy's is the second anchor,'' Fraim said.
Key officials with Federated could not be reached for comment.
The suburban-style shopping mall would fill a 17-acre tract west of St. Paul's Boulevard, that has been vacant since the city cleared the land decades ago during urban renewal. The star tenant of the new mall would be Nordstrom, a luxury department store of the type the Hampton Roads region lacks.
The city announced the construction of the mall last summer, after Nordstrom signed a letter of intent.
``The center is a fait accompli,'' Smithwick said in June. ``This is now a done deal.''
The mall is estimated to cost $270 million. The city's portion would be about $100 million.
A spokeswoman for Nordstrom, Kathy Valentine, said its officials were in the middle of designing floor plans for the planned store here.
``From the Nordstrom standpoint, everything is on schedule,'' Valentine said.
Fraim said several executives of major department stores interested in being the third anchor for the project are visiting the city this week.
The Federal Housing and Urban Development administration has agreed to grant the city $33 million in low-interest loans. The city would sell another $50 million to $60 million in revenue bonds, to be repaid through parking fees in two planned garages.
The city also would sell up to $12 million in general obligation bonds.
KEYWORDS: MACARTHUR CENTER SHOPPING MALL by CNB