Boulder leaders approve Macy’s redevelopment plans

BOULDER — After three years of planning and lobbying, Macy’s Inc. (NYSE: M) won approval Tuesday night to move forward with a proposal to redevelop its store in the Twenty Ninth Street shopping area.

The Boulder City Council, in an 8-1 vote, approved a site plan that proposes to transform the aging department store into a mixed-use office and retail space. Councilwoman Mary Young was the lone member to oppose the measure.

Through a process of “adaptive reuse,” Macy’s, with help from Corum Real Estate Group Inc. and Trestle Strategy Group, plans to morph the store into a three-story, roughly 155,000-square-foot office building with about 7,700 square feet of retail space on the ground floor.

For several years, Macy’s has identified underperforming stores occupying valuable real estate for sale or redevelopment. Macy’s has been eyeing the Boulder store for redevelopment since 2017, and that desire has only increased during the COVID-19 pandemic that has been devastating to much of the retail sector. 

“We believe we’ve designed the best possible project for our site, for the mall and for Boulder,” Macy’s director of development Jessica Fraser said. “… Given the state of retail today, which COVID has exacerbated, we believe it’s a real possibility that this could become a vacant space, or a seasonal retail-only space.”

Boulder Chamber president John Tayer noted the decline in sales tax receipts from retail and dining during the pandemic and said the redevelopment project represents an opportunity for a “more sustainable economic future for our town.”

“We stand here with one of the most important retail and dining destinations asking you for a lifeline,” he told the City Council.

Despite the approval, Tuesday’s public hearing demonstrated that the Macy’s project is likely to remain controversial as many council members and residents expressed concerns that the addition of office space will exacerbate Boulder’s jobs-housing imbalance.  

That imbalance is a reference to Boulder’s ongoing challenge of providing affordable housing options for the city’s workforce while continuing to add high-wage professional jobs that push up the cost of housing. 

Boulder’s concern over the jobs-housing imbalance is so acute that the council in early 2019 adopted a development moratorium across a swath of the city that includes the Macy’s site. That moratorium, inspired by Macy’s proposal, was meant, in part, to assure existing residential and retail spaces wouldn’t be gobbled up by developers and turned into office buildings. Macy’s plans were initiated prior to the moratorium, which was rolled back in October 2019.

In an effort to address these concerns, Macy’s has pledged to contribute $3 million to Boulder’s affordable housing program.

Lawyers for the parties will work out the details of this contribution. Once that occurs, a final measure to approve plans for the project will be included on the consent agenda of a future council meeting this month or next. 

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