$5 million dollar loan for Southdale mall renovation (Bloomington, Edina: real estate, house)

[daboywonder2002]

I cant wait to see the new southdale mall. No more having to drive to MOA all the time. woo hoo. here's the link- Edina, Minnesota » Blog Archive » Deal on Southdale.

At their meeting Tuesday night, the City Council approved the proposed development agreement with Simon Property Group which provides Simon with a $5 million, zero-interest loan as an incentive to undertake a larger revitalization of the Southdale Mall. The Council vote was 4-1. Overall, the Council was excited about the prospect of the mall becoming a revitalized commercial center for not only Edina, but for the south Metro area as well. The project(s) will get started almost immediately. They need to wrap up before the end of the year.
There are a couple of projects started at Southdale that are not part of the revitalization package, so when they start adding the new projects, that place is going to be quite a construction zone for most of this year. I guess that’s the price of progress.
The Council believes a revitalized Southdale Mall will help energize the commercial real estate recovery of the entire Southdale area. The theory is that the mall will act as a catalyst to drive more consumer traffic and interest in this part of Edina. If it does, the City (and its taxpayers) will benefit by increased development revenues and by a general increase the real estate values in the area. Consumers and residents will benefit because they can buy what they need at the mall, or stores around the mall.
Now it’s time to put theory into action.

[GBCommenter]

Good money chasing after bad, I say...

The Edina City Council is either: 1) not able to recognize the obvious or 2) not willing to recognize the obvious because of the Council Members own interests that have more to do with politics and re-election campaigns as opposed to what is best for the City of Edina. What is the obvious? The obvious is this: if the private market (be it Simon themselves or other private investors) see no profitable return on an investment into Southdale, it is because there IS no profitable return on such investment - otherwise obviously private investors would invest their money to make profit.

If Keynesian economics (or maybe, on a more basic level - "spending our way to prosperity") worked, we would have an economic utopia around the Metrodome instead of one bar that opened by the Dome, and Obamanomics would have sent unemployment plummeting while we were paving the streets with gold.

Deals such as this do not encourage real economic prosperity; at best it allows inefficient businesses that should perish from their own mismanagement or actual lack of need to live off other persons (in this case, the taxpayers of Edina). It will make Edina taxpayers unwilling business partners of which they will not have personal benefit.

[Azul91]

I hope this helps to "revitalize" the place, I am working in Macy's while i'm in college, and jeez, the place is dead during the week and you can almost hear the crickets outside, lol.

[golfgal]

When you have one of the most popular tourist attractions in the country 5 miles down the road that is also a shopping mall, fancy tile isn't going to help you. I used to shop at Southdale way back when I was in high school but even back then the mall was lacking, especially for eating options. At that time they had one place to eat, that courtyard "restaurant" that was mostly a salad bar. We went there a couple years ago and couldn't find anything we were looking for.

[uptown_urbanist]

As far as the food goes, they're in the process of opening up a new food court, so that should really help.

I like Southdale, and vastly prefer it to the Mall of America. Many of my neighbors shop there and avoid MOA when they can -- MOA is big, and it's farther away. That said, there are times when people are going to want something huge like MOA, and obviously Southdale is not going to be able to compete with that. They are a good, solid local option, and I think there's hope for the future that they'll come back to life after a rough period. (the new Herberger's is also very nice and is making the place feel more alive)

To build on the first post, this is a loan, not a grant -- it's also being funded through TIF (from Centennial Lakes district) and the city is thinking about creating a Southdale-area TIF district (or maybe they did that at the meeting?), so it's not coming out of Edina's general funds. I wasn't at the meeting, but from what I had read Simon was, as part of the deal, also required to spend many more millions of their own money for the mall common areas. The Edina $ is also not being used for individual store renovations.

I do think that it's in Edina's interest to make sure that the mall flourishes, as well as to help make the improvements that will improve its connections to the rest of the city -- I believe that a transit station was part of the loan money, for example, which is DESPERATELY needed (also, I believe, new sidewalks). The Southdale area has had a lot of redevelopment and has a lot of potential, so if done right, this could be a major asset for the area. And while I'm not a big mall person, the reality is that Southdale really IS the "downtown" of Edina, and has a public function (not to mention should really be considered a historic landmark of national importance!), so despite the concerns about the blurring of private/public boundaries, the city really needs Southdale to be successful. A TIF-financed loan with all the accompanying stipulations seems reasonable.

[Globe199]

Originally Posted by GBCommenter

If Keynesian economics (or maybe, on a more basic level - "spending our way to prosperity") worked, we would have an economic utopia around the Metrodome instead of one bar that opened by the Dome, and Obamanomics would have sent unemployment plummeting while we were paving the streets with gold.

I agree with you on the mall point, but there's a difference between stupid spending and smart spending.

Putting money into schools, roads, bridges, healthcare -- that makes a positive difference. Putting money into aging brick-and-mortar shopping malls is dumb.

I think if Southdale was in any other community but with the same proximity to MOA, it may have already closed. Edina has the cash to throw at it, so they will keep it alive for probably many more years. They've done an OK job limping along anyway.

But the long-term consumer trend is away from shopping malls, and there is already an abundance of retail in that area. (Though it does seem that developers in Minnesota can never have enough retail.)

[Clifford63]

It could be a good thing, but it remains to be seen what will actually come of this. The area itself is quite vibrant and the recent upgrade of target to Super Target was a good thing. The Galleria next door is great too. I always perferred to go to Southdale vs MOA, but you really could see the place was going downhill fast. I am sure MOA casts a big shadow, but there is potential that Southdale can capture back some of the business they lost, but it is not going to be easy.

[Minneapolitan]

I welcome this loan, as I prefer Southdale, even though it is a touch further away from my house in south MPLS than is MOA. The MOA is just too big for me. Most of my neighbors feel the same. I usually visit the MOA once a year and for one reason: to be able to shop for Christmas all in one spot. I can usually get all of my Christmas shopping done in under 4 hours at MOA. For those 'everyday' shopping trips to the mall that average, for me, about twice a month, I greatly prefer the Southdale area. The Southdale area is much more diversified than is the MOA, with grocery stores, furniture stores, SuperTarget, pet stores, liquor stores etc. that serve my everyday life functions. Of course, I can get most everyday stuff without leaving my neighborhood...but when I need a new shirt, shoes or whatnot, or I want to see a movie, it's nice to have those other stores immediately around to make my car trip out there more efficient and productive.

[ocsid]

This is a bad move. If you recall, Brookdale undertook a huge addition/remodel just a few years before they completely went under. The enclosed regional mall is a declining form of retail, in favor of lifestyle centers like Arbor Lake. Plus, Southdale is starting to get a rougher reputation, much like Brookdale before it.

[ferr0052]

I can't comment on the demise of Brookdale, since I have been there only once. However, it seems as though Southdale was do for a makeover many years ago--but like many things, got stalled out do to the recession. I always believed that Southdale made a fatal mistake gearing to the 13-17 year old girls demographic. I would of "upscaled" the mall years ago instead of competing with MOA. Although in 2009, I made a comment that i would have "killed" the mall with my idea.

With all that said, I think that redesigning the mall will only be a good thing for the area. I agree with Clifford that the area is thriving and am excited to see what happens. I also agree that southdale and MOA are very different shopping experiences.

Does anybody know if they will be keeping the Herbergers in Bloomington off Penn now that they have the new Southdale location?