THE VIRGINIAN-PILOT
Copyright (c) 1996, Landmark Communications, Inc.
DATE: Sunday, February 18, 1996 TAG: 9602180020
SECTION: FRONT PAGE: A1 EDITION: FINAL
SERIES: This is part of a continuing series on the planned MacArthur Center
Mall.
SOURCE: BY ALEX MARSHALL, STAFF WRITER
DATELINE: COLUMBUS, OHIO LENGTH: Long : 260 lines
As Norfolk wonders whether the $300 million MacArthur Center mall will succeed or fail, there may be lessons to be learned from one built in Ohio by the same developer six years ago.
There, too, the city lured upscale department stores to a retail-starved downtown using taxpayer money as a bargaining chip.
There, too, many questioned whether enough suburbanites would drive past nearby malls to shop downtown.
And there, too, planners hoped that a successful mall would spread vitality to the tired, half-abandoned streets surrounding it.
Six years after opening in fall 1989, the City Center mall is unquestionably the top shopping spot in the region.
Although crowded during the week, when Columbus' downtown is home to a large work force, it is even busier on a Saturday afternoon, when its three stories are packed with suburban customers.
One Friday evening this month, Kim Corry explained why she drove 20 miles from her suburban home to shop at City Center.
``You can't find this kind of quality anywhere else,'' Corry said, as she left the tony Metropolitan Museum of Art store. She makes the trek about twice a month, she said.
Although many Columbus residents said the mall ``is the best thing that ever happened to downtown,'' it apparently has done little to revive the stores and streets around it.
Corry, a tall, elegantly dressed woman, never considers leaving the mall to walk downtown.
``What's there to see outside,'' Corry asked sarcastically, ``the Greyhound bus station?''
Had she taken a stroll, Corry would have confronted a line of bedraggled, vacant or underused stores in low-rise, turn-of-the-century buildings.
Although they are across the street from the mall's formal front door on High Street, the shops remain a million miles away in look and feel.
``I don't see any business from across the street,'' said Elliot Lambert, manager of a High Street Radio Shack with stained ceiling tiles and half-empty shelves. ``Most of my customers are people who ride the bus, or who work at the capital and have been doing business with us for years.''
But the mall has had an impact on downtown, Columbus officials said. Surrounding neighborhoods have boomed, in part because residents no longer have to drive to the suburbs to shop. Millions of people who seldom visited downtown now come regularly. And city leaders have funneled profits from the mall into other projects.
The mall also has helped boost attendance at downtown plays and other arts-related events. One reason: The historic 2,700-seat Ohio Theater is attached to the mall by an open-air, covered arcade.
The project may have saved the Lazarus, a historic downtown department store, from abandonment by incorporating it into the mall, officials said.
Overall, the mall has made huge contributions to the city, but ``spilling retail traffic out into the street wasn't one of them,'' said John Rosenberger, executive director of Capitol South, the nonprofit corporation that developed the area that includes the mall.
Columbus is a sprawling city with an economy that rests comfortably on banks, insurance companies, large corporations such as Borden Inc., its role as Ohio's state capital, and the 50,000-strong Ohio State University. It's a metropolitan region about the size of Hampton Roads, with about 1.4 million people, according to the 1990 Census.
Like Norfolk, though, it has a downtown pocked by vacant lots and parking garages.
The central avenue, High Street, looks like Richmond's Broad Street with its mixture of tall, modern office buildings, small and older low-rise buildings, and monumental state public buildings. The downtown as a whole sprawls over four square miles and more than 100 blocks, impressive in its size but challenging as well.
The City Center mall sits at the core, near the corner of High and West Broad streets, across from the state capitol building and soaring glass office towers.
With virtually all of its stores opening inward into a three-level atrium, the City Center mall is surprisingly hard to spot from the street. Motorists mostly see blank walls, and a hotel, office building and theater that take up much of the street frontage.
One corner of the mall property remains vacant - an opportunity for a fourth department store or an office building. It now is a landscaped park, awaiting development.
A central feature of City Center is the sky bridge to the ornate old Lazarus department store, which stands some seven stories high, and was founded by a Columbus family of the same name.
The downtown Lazarus store takes up half a city block and sells everything from suits to television sets and furniture. It even has a small pharmacy. Like Macy's in New York, it has a bargain basement at its lowest level.
With a parking garage flanking the mall and a smaller one underneath the property, City Center is in many ways easier to visit than a suburban shopping center.
The region's central freeways enter the city a few blocks from the mall, as they would in Norfolk. Because the garage is enclosed, many shoppers walk to the mall in light clothing in even the coldest weather. Shoppers do not have to navigate long parking lots through acres of cars.
``This is a very self-contained place,'' said Lance Clark, who'd traveled 30 miles on a Thursday night from Grandville. As he sat outside the Marshall Field's department store, waiting for his wife, he fingered his tweed sport jacket. It was his only coat, despite February's cold. ``I'm not wearing an overcoat,'' he said. ``I left it in the car.''
The insularity of the mall, however, makes spreading business into the surrounding streets even more difficult.
John Simon, developer of the MacArthur Center for the Taubman Co., says he believes Norfolk's surrounding businesses will fare better than those in Columbus. Norfolk's downtown is tighter and more focused, he said, so it should be easier to link the mall to surrounding businesses and other destinations.
For example, the Columbus convention center, although successful, is a half-mile from the mall. The white, mansion-like downtown library is a mile east of the mall. By comparison, Norfolk's convention center at the Marriott, Kirn Memorial Library, Scope, Chrysler Hall, Waterside, Harbor Park and the new branch of Tidewater Community College all cluster within a few blocks of the site of the MacArthur Center.
The long, tortuous development of City Center makes the struggle for MacArthur Center look easy. Stretching out over two decades - three, by some accounts - the rise of City Center was a slow, trench-warfare campaign by city officials and a few business leaders.
The city had to buy the property, beginning in the early 1970s, piecemeal from dozens of small property owners, most of whom did not want to sell. It took the city 10 years to buy the 75 tracts, including several landmark buildings, from more than 50 owners.
The nonprofit corporation that led the project, Capitol South, went through three executive directors and two developers before arriving at Taubman, which finished the project. Alex Conroy, the initial developer of MacArthur Center and now a minority partner in Norfolk's project, also was involved initially in City Center, say Taubman officials.
Before the mall was constructed, a Hyatt hotel and an office complex were built nearby on land that had been acquired in the redevelopment effort.
As in Norfolk, the financing of the project is not simple or easily broken down. Again as in Norfolk, it is a mixture of public and private financing, with much of the public financing coming as loans. The taxpayers' most significant out-of-pocket expense was $31 million, for land. The property was then turned over to the nonprofit, Capitol South corporation.
The federal government pitched in roughly $12 million in low-interest loans. The parking garages, owned by the city, were built with $30 million in revenue bonds, similar to what Norfolk is planning.
The Columbus mall will not pay real estate taxes until 1997; that was one of the concessions made by the city. The mall and stores do pay rent to Capitol South, which in turn passes most of it to the city. Since the mall opened, Capitol South has paid the city $25 million.
Capitol South keeps 10 percent of the rent. It has used the cash to fund a $1 million renovation of an old city market, which recently opened. It also has awarded a $500,000 grant to renovate an abandoned, historic theater, the Great Southern theater, near the mall.
``It was a long, drawn-out procedure, but it was worth it,'' said Councilman M.D. Portman, former president and 30-year veteran of the city's council. ``I can honestly say that working on the City Center mall was one of the bright spots in my tenure.''
A key player in the mall development was Leslie H. Wexner, owner and founder of the fashion store The Limited, which, with its progeny, is one of the most successful retailers in the country. Wexner, who is based in Columbus, agreed to put many of his stores in the mall.
City Center is now loaded with Wexner's stores, including a Henri Bendel, a high-fashion store. Wexner has more than a half-dozen stores in the mall, including many of its most fashionable and popular. Wexner uses City Center as a test for new store concepts, say mall officials, and in the mall you find not only The Limited and such subsidiaries as Structure and Victoria's Secret, but also Cacique, Bath & Body Works, and Henri Bendel - all owned by Wexner, a billionaire.
The City Center mall is part of a long history of cities trying to revive downtowns by building imitations of the enclosed suburban shopping malls that were stealing shoppers.
But it is not the only mall that could provide insight to Norfolk residents.
Many downtown malls have done poorly or failed outright, particularly after a decade or more in operation.
To succeed, a downtown mall must be better than the suburban malls, not just as good, according to industry observers. That leaves downtown malls especially vulnerable to having their market stolen as the competition improves.
``It's a problem all shopping centers face, but it seems to be a bigger problem downtown,'' said Michael Beyard of the Urban Land Institute in Washington. ``People are more likely to abandon it, because it takes a special effort to get there.''
In the Northeast, Rochester, Troy, New Haven and several other cities have either abandoned their downtown malls or have seen them go half-vacant. Some malls succeed for a while, and then fail as market trends pass them by.
The Plaza Pasadena opened in that California city in 1980. Moderately successful for a decade, it is now a serious burden on the city, and some suggest tearing it down. One private developer is considering buying the mall and opening it to the street.
Rick Cole, until recently the mayor of Pasadena, calls the Plaza ``an embarrassment'' that seriously harmed the design of the city and its flow of traffic.
Several malls built in the past decade, however, have prospered. San Diego opened Horton Plaza in the late 1980s to both commercial and critical success. Taubman opened Cherry Creek in an older urban neighborhood of Denver in 1990, which the company and the mall industry say has been very successful.
Indianapolis opened its downtown mall, featuring a Nordstrom, last year. With almost $200 million in public financing, it is patterned after City Center mall in Columbus, although it was not built by Taubman.
The buzz around Columbus is that City Center, although very successful now, will be challenged by the four new malls being planned around the city, including a mammoth, 4-million-square-foot Easton Center. This is comparable in size to the Mall of America outside Minneapolis, the largest mall in the country. To compound the problem, the project is being planned by Wexner, The Limited's owner and a prime tenant of City Center mall.
City Center's manager, Norman Plourde, says he believes the downtown mall can hold its shoppers because of its unique location and its unique combination of stores.
``We're almost competition-proof,'' he said. ILLUSTRATION: Color photo
NEAL C. LAURON
People drive from the suburbs to downtown Columbus, Ohio - 20, 30
miles or more, even on weeknights - to shop at this upscale mall.
NEAL C. LAURON photos
Retail vacancies on High Street were one reason that Columbus city
officials sought to draw upscale department stores in a mall. As
with Norfolk, officials used taxpayer money as a bargaining chip.
One appeal of the City Center mall: a parking garage next to it, and
more parking underneath. Most shoppers enter the mall on its third
level - which is also where the most exclusive stores are.
Across from the mall, Radio Shack manager Elliot Lambert says: ``I
don't see any business from across the street. Most of my customers
are people who ride the bus, or who work at the capital . . . ''
At City Center, ``polite'' is key. Follow the ``Code of Conduct''
and you're OK. Break it once, you get a reminder: the code, on a
card, from a guard. Twice, you get a second card. Three times, you
get thrown out.
Map
VP
Graphic\
MacARTHUR CENTER vs. CITY CENTER
SIMILARITIES
Same developer, The Taubman Co.
Both malls are at the center of troubled downtowns.
Both have substantial public investment.
Each has three levels and 1.2 million feet on roughly 20 acres.
Both have department stores unique to the region.
DIFFERENCES
Columbus is the state capital, and has more corporate
headquarters than Norfolk. Those factors boost shopping at its
mall.
Norfolk's downtown is smaller and more compact, so perhaps easier
to revive.
MacArthur Center's Nordstrom has more prominence than City
Center's top department stores, which could draw more traffic to
MacArthur Center.
KEYWORDS: SHOPPING CENTERS URBAN RENEWAL DOWNTOWN
SHOPPING MALLS by CNB