The owner of Sunrise Mall in Citrus Heights has taken a step that could make redevelopment of the site more likely.
“The mall's owner, New York-based Namdar Realty Group, bought a Macy's store building on the east side of the mall,” says Sonya Sorich of the Sacramento Business Journal. “The purchase also included about 10 acres of parking on the mall's east side.”
The move comes as Citrus Heights city officials are crafting a new site plan for the 100-acre mall property, with participation from Sunrise Mall's owners. Anchor stores at a mall typically own their own properties, and that can pose a significant barrier to any possible redevelopment plans.
“Macy's will lease the store back from the mall's owners and keep it open,” says Sorich. “Macy's actually has two buildings at Sunrise Mall, and its other building is owned by the mall's owner as well.”
Earlier this year, the city of Citrus Heights held a workshop where three potential redevelopment concepts were discussed. All those concepts involved adding uses other than retail to the site. That includes ideas like housing, office space, and even a hotel.
“There was also a possible plan that included a pedestrian-friendly thoroughfare in the middle of the mall property, with retail stores topped by residential units on either side,” says Sorich. “In March, a Citrus Heights representative told us the city could release a more finalized concept for the mall this summer.”
Meanwhile, there are still some things to watch as redevelopment discussions move forward.
“Some properties within Sunrise Mall are still independently owned,” says Sorich. “That includes the closed Sears store and its parking at the mall's southern end, and J.C. Penney and its parking on the northeast side of the mall.”
J.C Penney is one of the retail chains that's been hit pretty hard by the coronavirus pandemic. Some reports say the retail chain, which has multiple locations in the Sacramento area, is considering filing for bankruptcy.
“Filing for bankruptcy protection doesn't necessarily mean that a retailer's stores will close or go up for sale,” says Sorich. “But department stores were already struggling for a long time before the pandemic, and it's possible the retail landscape will significantly change in the future.”
It’s still unclear whether department stores can survive the pandemic. That sector of retail had significant challenges before the pandemic.
“We already saw consumer preferences leaning toward smaller stores, not to mention the rise of e-commerce,” says Sorich. “Now, those big department store chains have temporarily closed their brick-and-mortar locations amid shelter-in-place orders ... which has heightened their existing challenges.”
In April, the New York Times reported that there's expected to be an enormous reduction in the number of locations that major department store chains operate. And that could affect how local retail centers look and operate.
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