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Malls hope renovations will boost business in tough retail climate

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Westfield UTC is one of several San Diego shopping malls undergoing a large renovation amid a tough retail sales environment. Tom Tierney, senior vice president for Westfield San Diego, said the University City property “needed a bit of shine” to do well against its competitors.

"Westfield has had a long-standing philosophy of reinvesting in our properties, especially in a market like San Diego, which is a very strong market,” Tierney said. “UTC is definitely our flagship property in this region, and this will elevate it to that level.”

Westfield (ASX: WDC) has a long-term vision for its San Diego properties, and sees any renovations as an investment in the future, he said.

The $180 million revitalization at Westfield UTC includes the addition of a 14-screen ArcLight movie theater and a 24 Hour Fitness Super-Sport Club, new store facades throughout, and a remodeled dining terrace now separated from the ice rink for better climate control.

Westfield is the general contractor on the project, with subcontractors including Murrow-Meadows Corp., A.O. Reed, McMahon Steel Construction, CPE Construction, Johnson Finch & McClure Inc., California Sheet Metal, Anning-Johnson Co. and Premier Tile & Marble.

A rendering shows an aerial view of the new palm plaza at Westfield UTC Mall, set to be complete in November. The mall is also set to get a new movie theater, 24 Hour Fitness and outdoor dining terrace.

The movie theater and fitness club occupy space that formerly held a Robinsons-May department store. Other new retailers, such as Tender Greens and Tiffany & Co., were brought in by shuffling other mall tenants, Tierney said.

“It’s a pretty low-impact project,” he said, noting parking hasn’t been reduced. “We’re taking what we have and making efficient use of it.”

The mall renovation is scheduled for completion by November, Tierney said.

Westfield has estimated the facelift could increase UTC’s annual taxable sales by $127.5 million, to nearly $500 million.

Retail sales nationwide have stalled in recent months, according to the National Retail Foundation. Citing a 0.5 percent decrease in June retail sales to $401.5 billion as reported by the U.S. Census Bureau, the National Retail Foundation said in July the data suggests consumers are holding off on spending amid economic unease. The retail foundation expects consumer spending to pick up with back-to-school shopping.

Meanwhile, Westfield’s plan to invest in its San Diego malls also extends to its Westfield North County property. Better known to locals as North County Fair, the Escondido mall is receiving a $55 million facelift to be complete by year’s end.

Beyond new interior finishes and a revamped food court, Westfield North County will now house a three-story, 150,000-square-foot Target in a former Robinsons-May space.

Simon Property Group, owner of Fashion Valley Mall, paid millions to renovate the Mission Valley retail hub.

“It will be one of the top three-level Targets in the U.S.,” Tierney said, adding that the Target store will be open in October.

Elsewhere, Simon Property Group Inc. (NYSE: SPG) has not disclosed a final price tag for its renovation of Fashion Valley Mall, but is calling it a “multimillion-dollar investment,” according to spokeswoman Hailey Polzin.

The renovation at the Mission Valley-area mall began two years ago and is nearly complete. So far, it’s included a remodeled food court, new decorative fountains and landscaping, new seating and shade features, and restyled signage. Still to come are a new children’s play area, revamped Macy’s corridors, and the August installation of a 46-by-16 foot “living wall” plant feature. The plant wall, to be installed on the northeast corner of the mall across from The Cheesecake Factory, was designed by Mission Landscape Architecture.

The architect on the Fashion Valley Mall remodel is SGPA Architecture and Planning, with construction by The Whiting Turner Contracting Co.

No renovations are currently scheduled for Simon Property Group’s other San Diego properties, Carlsbad Premium Outlets and Las Americas Premium Outlets.

-McEntee is a San Diego-based freelance writer.

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