The owner of the Antelope Valley Mall is spending $10 million on a renovation project for a new anchor tenant and community gathering area. Forest City Enterprises Inc. of Cleveland is gutting a 113,000-square-foot building at the Palmdale center that has been vacant four years to make way for new tenants, the first being a Dick’s Sporting Goods Inc. outlet to open in late 2014. The building was purchased by Forest City in February for $8.5 million from Spanish retailer El Corte Ingles S.A., which leased the space to department store Harris-Gottschalks until parent Gottschalks Inc. went bankrupt in 2009. The mall owner also will improve the public plaza area between the building and the main entrance to the mall with a new water feature and landscaping, a stage for community events, Wi-Fi access and outdoor patio area. “Every shopping center has a lifecycle and you get into a period to make changes. Antelope Valley Mall is at that point, and we want to be fresh and relevant for the customers,” said Alan Schmiedicker, senior vice president of retail property management for Forest City. The mall, built in 1990 by Forest City, is the valley’s largest retail center and currently has an 87 percent occupancy rate. Its other anchors are a Macy’s, J.C. Penney, a large Forever 21 and Sears. The occupancy rate is well below the 94 rate in the Los Angeles metropolitan area and even the 89.5 percent national average, according to Reis Inc., a New York real-estate data and market analysis firm. Indeed, the mall at Rancho Vista Boulevard and 15th St. West has struggled since the housing bust and recession, despite a series of improvements and aggressive tenant moves by Forest City, a publicly traded company with a $10 billion portfolio that includes 11 enclosed malls. Its only other retail property in the region is the South Bay Galleria in Redondo Beach. In 2007, Forest City spent $7 million on renovations that relocated a movie theater to another location at the mall, with the vacant space divided and occupied by two new tenants. Three years later, Macy’s moved into a 104,000-square-foot building formerly occupied by another Gottschalk’s; Forest City had acquired the space for $12 million in 2008 and leased it to Macy’s. In 2011, a Yard House restaurant opened at the mall, and a year later Kirkland’s home decorations and furniture became a new major tenant. Matthew May, a retail broker and president of May Realty Advisors in Sherman Oaks, said the Dick’s – the nation’s largest sporting goods retailer – should be a good fit for the mall, which faces more competition from nearby power centers and strip malls than the next closest mall: Westfield Valencia Town Center in Santa Clarita. “They are the right tenant, there is no issue as far as that goes,” he said. Right sizing Mall General Manager Scott Cummings said Forest City had been in talks for more than a year with Dick’s about opening at the mall space. “For another national retailer to come to the Antelope Valley is fantastic for the community,” he said. Dick’s will take about 55,000 square feet. There are negotiations with another national chain for 22,000 square feet, and with another potential tenant to take a corner space of 18,000 square feet, Cummings added. The space taken by Dick’s is typical of the size store the Coraopolis, Pa.-based chain operates. Dick’s closest stores are in Moorpark and Santa Clarita. Dick’s, a publicly traded company that had net income of $50 million on revenue of $1.4 billion in the third quarter, operates more than 500 stores in 44 states. The chain also owns specialty retailer Golf Galaxy LLC and launched this year outdoor equipment and accessories stores Field & Stream. The chain planned to open 40 stores this year. A representative of Dick’s refused to comment on the new store. But the chain is doing well, said Sean McGowan, an analyst with Needham & Co. in New York who tracks the sporting goods industry. Dick’s main competitors are Sports Authority Inc. of Englewood, Colo. and Academy Sports + Outdoors, of Katy, Texas. “Unlike Sports Authority, (Dick’s) are in almost every state and expanding,” he said. Dick’s moved into Southern California in 2007 when it acquired the 15-store Chick’s sporting goods chain. The West Coast provided some challenges as the weather and lifestyle required changes to the product mix at Dick’s, which was used to the more extreme seasonal weather elsewhere in the country , McGowan said. “They had to spend more on advertising but they have since right sized,” he said. Capital investment The Antelope Valley is already served by a Sport Chalet store less than a mile from the mall and a Big 5. But Palmdale Mayor Jim Ledford said the arrival of Dick’s was a substantial gain for the city. He said city officials met with representative of Dick’s and marketed the area. “It creates more synergy within the mall itself and makes it more of a regional destination for shopping. It (was) important to let them know we want them in the community,” said Ledford, who also lauded Forest City’s decision to commit more capital to the mall. Sales tax revenue generated by the mall has averaged just more than $2 million over the past four complete fiscal years, which run from July 1 to June 30. So far in the current fiscal year, the mall has brought in about $500,000 in sales tax, with the city confident that it will finish the fiscal year stronger than the year before, said Dave Walter, the city’s economic development manager. “People are feeling better about the economy and feeling better about their jobs,” he said.
Palmdale Mall Getting Sporty
