Struggling malls hope for new leases on life

It’s the cycle of retail life.

Two regional malls are about to undergo extreme makeovers. Developers have revealed plans for the struggling Twin Peaks Mall in Longmont and the equally struggling Foothills Mall in Fort Collins. Both properties will be transformed in an effort to stanch the bleeding of retailers and sales-tax dollars.

In Longmont, Fort Collins-based development company NewMark Merrill Mountain States has unveiled plans to convert the 555,000-square-foot enclosed mall into an outdoor retail village. The redevelopment is expected to cost $80 million.

Farther north, Greenwood Village-based Alberta Development Partners LLC has revealed plans for a hybrid indoor-outdoor shopping environment, razing part of the 760,000-square-foot mall.

The efforts are reminiscent of the transformation of Crossroads Mall in Boulder, which was largely demolished to make way for Twenty Ninth Street, a lifestyle center that is approaching full occupancy, with a mixture of retail and office space.

In fact, Alberta officials told the Fort Collins Coloradoan that they intend to pursue retailers such as Anthropologie, Nordstrom Rack and Trader Joe’s. Foothills also would retain Macy’s as a large anchor tenant.

Sound familiar? Anthropologie and Nordstrom Rack already occupy large spaces at Twenty Ninth Street, with Trader Joe’s soon to come. Macy’s also retained its anchor store in Boulder.

Both Foothills and Twin Peaks also contemplate new cinemas, with many smaller retailers and restaurants.

Can what worked at Crossroads also work at Foothills and Twin Peaks? Fort Collins once ranked as the retail center not only of northern Colorado but also of a wider region that included southeastern Wyoming and beyond. That dominance was ended with the opening of The Promenade Shops at Centerra at Interstate 25 and U.S. Highway 34.

Declining occupancy — Foothills is barely 50 percent filled — has left the mall with vast empty spaces and bleak prospects. Without a major redevelopment, the property’s decline would continue. The Foothills redevelopment will be decided by voters, who will cast ballots on whether to create a special taxing district to help finance the project.

In Longmont, redevelopment of the once-thriving Twin Peaks Mall likely will also require city participation in the form of tax incentives.

Backers of both redevelopment proposals appear not to be concerned with proximity to other, existing retail projects. Twenty Ninth Street has thrived even with FlatIron Crossing just down the road in Broomfield. Twin Peaks would be just up the Diagonal Highway from Boulder. And Foothills must combat not only The Promenade Shops at Centerra in Loveland but also Front Range Village, another retail development in southeast Fort Collins.

These projects lay bare the lifespan of large retail centers. Just a few decades can throw a once innovative project into irrelevancy and decline, to extreme effect. In Colorado, municipalities are heavily reliant on sales-tax dollars. To lose millions of dollars to other communities can be devastating for a city’s budget.

So no wonder that Boulder, Broomfield, Longmont and Fort Collins have gone to great lengths to preserve those tax revenues at all costs.

Any city official would want to ensure that a major tax generator returns to the positive phase of the cycle of life as quickly as possible.

Christopher Wood can be reached at 303-440-4950 or cwood@bcbr.com.

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