Bad Timing for Elk Grove Promenade; Malls In Danger

If misery loves company, the half-constructed Elk Grove Promenade has lots of companionship.

According to a report filed today by U.S. News and World Report, shopping malls have become particularly vulnerable during the current recession. A combination of factors including changing demographics, heavy debt burdens of mall operators, the credit crunch and anemic consumer demand has weakened many malls.

The U.S. News story lists the 10 malls most likely to close. Surprisingly, only one of the endangered malls is owned by General Growth Properties, the bankrupt Chicago-based developer of the Elk Grove Promenade.

Below is a list of the tem most endangered malls with their current occupancy rates and sales per square foot:

-Century III Mall, Pittsburgh, Pa. (Occupancy rate: 70 percent; sales per square foot: $200*).
-Chambersburg Mall, Chambersburg, Pa. (62 percent; $234).
-Crossroads Mall, Omaha, Neb. (68 percent; $200*).
-Hickory Hollow Mall, Nashville, Tenn. (82 percent; $187).
-Highland Mall, Austin, Tex. (61 percent; $150*).
-Palm Beach Mall, West Palm Beach, Fla. (82 percent; $250*).
-SouthPark Mall, Moline, Ill. (84 percent; $225).
-Southridge Mall, Des Moines, Iowa. (84 percent; $168)
-Towne Mall, Franklin, Ohio. (49 percent; $207).
-Washington Crown Center, Washington, Pa. (70 percent; $265).

With no date for resumption of construction of the Elk Grove Promenade and continued weak retail sector, we hope this serves as a cautionary tale for the Elk Grove City Council.

In case it is unclear, let us spell it out: until such a time comes that the construction of the Elk Grove Promenade is completed and all the excess retail space in Elk Grove is absorbed, further retail development will do nothing more than act as a drag on the city and people of Elk Grove.

Until that time comes, which could take four or more years, the city should not issue any construction permits for retail property and look for ways to wean itself from the teat of retail sales tax revenues. The last thing we want to see happen is Elk Grove become a mecca for abandoned retail space.

Can you say Florin Mall?