On Jan. 21, the city Planning Commission approved a new construction project at the Westfield Valencia Town Center mall. In response, an organization called Santa Clarita Safe and Strong appealed the decision, stating that the project could impact “traffic, noise, air quality, soil quality, groundwater quality, health and safety” in the area.
The appeal is expected to be discussed at a future City Council meeting, but no date has been set for the appeal to be heard.
While I believe that the appeal is sparked by a genuine concern for our community, I watched the Jan. 21 hearing on and thought that the mall’s owner/operator, Westfield, did a very credible job of addressing the community’s concerns.
I live within walking distance of the mall and received at least one notice in my mailbox encouraging me to attend the hearing and express opposition to the project.
From what I observed on television, Westfield is tearing down the empty Sears store and replacing it with a Costco store having rooftop parking for the Patios portion of the mall that currently has insufficient parking.
Costco, a health club and movie theater will be constructed in a manner such that their patrons will park in the northeast portion of the parking lot, which currently is under-utilized.
Furthermore, Citrus Street will be reconfigured to ameliorate traffic concerns, including those resulting from a new gas station that will be accessed from Citrus Street.
The Valencia Town Center mall was built in an era when a regional mall was THE place to shop. The mall generates hundreds of jobs, and next to the car dealers, is probably the largest source of sales tax revenue for the city of Santa Clarita.
But today, regional malls are an endangered species because customers prefer to shop online. Consequently, owners must innovate and reinvent many malls to ensure those malls’ survival.
Malls historically have positioned anchor tenants to attract customers, who then shop at other stores in the mall. However, the anchor tenants are currently facing their own problems; many are going out of business or are shutting down numerous stores.
The Valencia Town Center mall historically had three anchor tenants — Sears, J.C. Penney and Macy’s. Sears has already closed its store. Macy’s recently announced its intention to close 20% of its stores in the next three years with an emphasis on smaller stores like the one in Valencia.
J.C. Penney is just behind Sears in terms of experiencing life-threatening financial problems.
In short, there is a reasonable possibility that, in the coming years, the Valencia Town Center mall’s anchor tenants could close their local stores.
Costco is a viable alternative.
When a mall loses its anchor tenants, it likely goes dark. Abandoned malls are a blight on a community. Just look at another Westfield property, the Woodland Hills Promenade Mall, which used to be a high-end shopping destination. All of its anchors went dark. Westfield has spent years trying to reposition the property.
The Promenade Mall is in a commercial neighborhood, so local residences are not significantly affected. The same cannot be said about the Valencia Town Center mall should it be forced to close its doors.
Based on information contained in the proxy materials for several local school bond offerings, the Valencia town Center mall has the highest appraised value of any property located in the William S. Hart Union High School District and the Santa Clarita Community College District. The mall’s owners pay approximately 1% of the total property taxes in those districts.
If the mall goes dark, the property taxes currently paid by the mall’s owners will be borne by other property owners — including homeowners.
But an adverse future for the mall is avoidable if we allow its owners to adapt the property to contemporary economic pressures.
On the other hand, if we tie up the redevelopment in red tape, we will squander an opportunity to maintain the economic viability of one of our community’s most valuable assets.
Whenever a new project is developed, or an existing project is redeveloped, there are collateral consequences that must be mitigated. Westfield apparently has taken a leading role in that process.
Westfield has undertaken similar projects in other threatened malls. Those evidently have gone well. Westfield is spending $100 million. If they don’t properly design the project and it results in the problems that concern opponents, Westfield stands to lose a considerable amount of money. Their interests appear to be reasonably aligned with those of the community.
Is Westfield’s plan perfect? Undoubtedly not, but it deserves to be appropriately and swiftly vetted for the overall economic well-being of the community. We currently have a strong economy, which provides an open window for redevelopment.
If we procrastinate, an economic downturn could close that window by jeopardizing the other existing anchor tenants and potentially endangering the mall’s long-term prospects.
Jim de Bree is a semi-retired CPA who resides in Valencia.