Mall could mark end of era
As planned opening date nears, shopping trends move on
On another Friday afternoon as traffic on Interstate 95 crawled by the SoNo Collection mall under construction in South Norwalk, passers- by were able to get a prolonged look at the pace the project is proceeding against an anticipated opening for the 2019 holiday season.
Does the mall’s new owner, Brookfield Property Partners, need to pick up the pace to make the deadline it inherited from GGP? The developer is not saying, and city officials are not offering a window to any insights they may have on that front.
Nearly 18 months after GGP began pouring the SoNo Collection’s foundation and with less than a year to go before the developer’s stated plans to open the mall in late October 2019, exposed girders still dominate most of the SoNo Collection site in full view of I- 95 in South Norwalk.
In early November, Brookfield executives shared their views of GGP’s mall portfolio after acquiring GGP a few months before in a $ 15 billion transaction, without addressing specifically the SoNo Collection’s progress. On its new leasing page for the SoNo Collection, Brookfield cites the fall of 2019 for a planned opening, without stating how late in the season that could occur.
In its quarterly report with the Securities & Exchange Commission, Brookfield Property lists an expected total SoNo Collection development cost of $ 475 million, $ 50 million below GGP’s own estimate only three months earlier, with Brookfield not noting whether the lower price tag is the result of construction savings, another investor picking up a portion of the project or another reason.
GGP had actively sought a co- investor for the SoNo Collection, with Brookfield CEO Brian Kingston saying earlier this month that is the goal for a subsegment of the GGP retail properties it inherited in the acquisition. Brookfield reported $ 52 million in new SoNo Collection expenses between July and September in its filing with the SEC, bringing to $ 258 million it has spent on the project to date including GGP contributions.
In the same filing, Brookfield has now pushed back to 2022 an earlier projection by GGP of 2020 as a “stabilized year” for the SoNo Collection to reach its retail tenancy expectations, with GGP having maintained occupancy levels of nearly 95 percent at its malls nationally.
Retailers finally making decisions
Some retail analysts have predicted the SoNo Collection could represent the last newly constructed, enclosed mall in the country for the foreseeable future, as Amazon continues to lure shoppers and as newer retail developments emphasize outdoor settings.
After GGP reserved its two major anchor pads for Bloomingdale’s and Nordstrom department stores, its CEO went on the record with the wish, in hindsight, of having left one pad open to accommodate a nonstore tenant of some type. Kingston made clear last month that is his vision as well for many of the GGP properties Brookfield has taken on, without singling out the SoNo Collection.
“The ongoing trend of nontraditional mall tenants taking space in our properties has not slowed,” Kingston said in November. “We continue to reposition valuable space that was once occupied by department stores, ( and) view this space as the most compelling opportunity to reinvest in our properties by replacing those stores with new and exciting uses that complement the in- line retail mall component. These include ... restaurants, entertainment venues, residential projects, flexible work spaces and hotels.”
On a normal timeline, it can take six months to build a fully functional restaurant space and line up approvals in a mall setting, according to Jessica Curtis, a retail and restaurant leasing expert in the Stam- ford office of CBRE, adding that it is not unusual for expected completion dates to shift on construction delays. With restaurant construction able to commence only when the surrounding interior has been completed, that would mean Brookfield would want to have those interior spaces largely in place by April or May.
Curtis said her clientele includes no shortage of upscale retailers who have added the SoNo Collection as a possible destination in southwestern Connecticut alongside Greenwich and Westport — but with uncertainties still in play regarding the overall mix of tenants that might help them decide, and the ongoing construction.
For those that choose the mall, it will take additional weeks to fit out their storefronts, stock merchandise simultaneously alongside dozens of other retailers, and train staff on site in advance of grand openings.
The openings will come — the only question is when.
“When GGP announced the SoNo Collection, ... a lot of retailers hit pause and said, “OK — we don’t know where we’re going to go because the mall hasn’t shaped up enough,” Curtis said. “Fast forward to this year and even the past six months, we’ve seen retailers finally making decisions.”
The western facade of the SoNo Collection mall under construction in South Norwalk.
Norwalk Mayor Harry Rilling and GGP manager Doug Adams in March 2016 with an early model of the SoNo Collection mall.
Foundation work proceeds in August 2017 at the site of the SoNo Collection mall in South Norwalk.