116 3rd St SE
Cedar Rapids, Iowa 52401
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CEDAR RAPIDS — First, the park went by the wayside in favor of parking lots at what's now called Westdale Town Center. Saks Fifth Avenue never came, nor Nordstrom Rack, nor the Cheesecake Factory — major retailer wishes of some in the community.
Instead, a U-Haul self-storage and truck rental opened where Younkers closed last year. A veterans clinic is heading to the second floor of the former Von Maur department store building and a car wash has signed on to open along 29th Avenue SW. Off-price retailers serve as anchors.
With hotel rooms and housing envisioned in an original master plan, Tru by Hilton has opened, a 33-unit mixed-use apartment building is on pace for completion in January, and more of each are expected.
The selection of tenants has sparked criticism that the ongoing overhaul of the failing 71-acre Westdale Mall built in 1979 is not what was promised when the city agreed to provide an estimated $28 million in public incentives over 20 years and to back a loan, which since has been paid off, as part of a refinancing deal.
Frew Development, which took on the project with city support, and Cedar Rapids officials are defending the direction, saying it's not only necessary to fill the large spaces, but the new uses could create the right blend of foot traffic from dining, shopping, services and living to revitalize the site — even if it is not the script that was written when the $90 million project began in 2013.
'To the degree there are people who are unhappy, there are just as many people who are happy or more,' John Frew, of Frew Development, said in his first public comments since U-Haul opened in April. 'I haven't done anything that hasn't been approved by City Council.'
In fact, he added, a city zoning code update in December allowed for U-Haul to go into the former department store.
'We didn't lobby for that,' he said. 'When we saw that, it gave us a new target to look for.'
Cedar Rapids Mayor Brad Hart agreed that Frew has not broken his pact with the city, and instead has necessarily adapted to a shifting retail landscape while meeting bench marks for jobs and property value increases required for the city incentives.
'Maybe the U-Haul fit is not as bad as people are envisioning,' Hart said. 'The plans have changed and been different for quite a while, and we knew that it was not all going to be retail. And, while U-Haul was maybe not my first choice, you have to look at what is going on in retail.'
Westdale is not alone. All of the malls in the Corridor are in the midst of significant transitions as the bricks-and-mortar retail environment shrinks with the growth of online shopping.
Lucky's Market, a grocer that replaced the closed Von Maur at the former Sycamore Mall in Iowa City, closed less than four years after opening. Lindale Mall in Cedar Rapids lost anchors Sears and Younkers within a month of each other last year. Coral Ridge Mall in Coralville has lost the same two anchors. Old Capitol Town Center in Iowa City is now more than half occupied with University of Iowa administrative offices.
Developers and mall operators have been forced to get creative in filling the sprawling spaces that anchor important areas in their communities.
'This sounds like a property that is strategically adapting to ensure economic vitality rather than letting the land sit empty,' Stephanie Cegielski, a spokeswoman for the New York-based International Council of Shopping Centers, said of Westdale in an email.
It's the same story around the country.
The Wall Street Journal reported that more than 6,000 retail closures were announced in 2018 — more than during the 2008 recession — and at least 50 retailers filed for bankruptcy protection, including Gymboree, Payless ShoeSource and Toys 'R' Us.
In their place, grocery stores, offices, fitness centers, coworking spaces, housing, hotels, medical clinics and other non-traditional mall occupants are setting up shop with varying degrees of success.
Even the U-Haul addition at Westdale isn't unique to the Cedar Rapids market.
The national chain took over an old Macy's space at Beaver Valley Mall outside of Pittsburgh; filled a vacated Dick's Sporting Goods in at Dayton Mall in Dayton, Ohio; and moved into an old Kmart at Sandburg Mall in Galesburg, Ill.
CoStar, a commercial real estate information company, compared what has happened to vacated retail anchor spaces from 2005-09 to 2014-18. The percentage of those empty spaces winding up as retail again dropped from 70 percent to just 36.5 percent. In its place, home furnishing stores, grocers, health and fitness centers, movies and entertainment and restaurants have become more common, according to the data.
'We're seeing a lot of redevelopment and repurposing of malls,' Cegielski said. 'We're seeing properties shift to mixed use as well as increase their diversity of tenants.'
Jennifer Pratt, Cedar Rapids community development director, urged people to stop thinking of the new Westdale as a mall.
'It's not a mall, and it never actually was supposed to be a mall,' she said.
For Frew, he said, he has to fill the spaces. His 'carrying costs' are huge, and he hasn't 'made a dime' for himself and or project investors.
Frew's next focus is adding housing, potentially 280 units over five to seven buildings on 7 acres west of the U-Haul. The housing will cater to all age ranges including seniors, assisted living and memory care,
'When we have a couple hundred housing units, then we will see the retail and small shops come in,' he said.
He also defended the U-Haul as 'a good thing for us,' a 'validation of the southwest side,' and U-Haul as a 'an essential ingredient to the daily lives within our country.'
He believes as the mix of uses fill in, people will 'see it all fits together' as an 'almost 24-hour set of people coming through.'
'We can sit and hope we will get a lot more retail at Westdale, but it is not going to happen,' he said. 'Anyone who complains about brick-and-mortar opportunities, stop shopping online. Stop shopping on Amazon. That's not going to happen.'
While he acknowledges the direction has 'shifted clearly' in some ways, the vision is not that far off from the original description as 'a place where people shop, eat, work, play and sleep.'
Sonya Harris, manager of Eyemart, located on the periphery of Westdale, had a measured appreciation for the new additions.
Her business is up 25 percent now compared with before Frew began redeveloping a center that was about 70 percent vacant. But she doesn't know how it will be in the long run.
'Anything is a good thing,' Harris said. 'It is better than an empty building. When each place opens, it gets a little better. It isn't really what we were expecting, but maybe it will turn out good in the end. Let's hope.'
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What's happening at malls in the Corridor?
Coral Ridge Mall, Coralville
Sears and Younkers departed in recent years. Intermittent tenants occupied the former Sears space after it closed in 2013. It was rebuilt and subdivided into six units in 2017, five of which have been filled, according to a mall director. Furniture Mart USA purchased the Younkers space after the department store closed last year, but plans are uncertain and the space remains vacant. A handful of smaller spaces are also vacant, according to an online mall directory.
Iowa City Marketplace, (Formerly Sycamore Mall)
Adapted to the loss of its last anchor retailer, Von Maur, by converting much of the space into Lucky's Market, a grocery store. Lucky's closed earlier this year, less than four years after opening, and no new plans for the space have been announced. A kickboxing gym, movie theater and fabric store are among the largest tenants.
Old Capitol Town Center, Iowa City
The University of Iowa now occupies most of the mall. Several university departments now have offices there, and restaurants dominate many of former retail spaces on the first floor.
Lindale Mall, Cedar Rapids
Sears and Younkers, two of the mall's original three anchor stores dating to 1960, shut their respective doors in July and August 2018. The two closures left Lindale with vacant space totaling 246,000 square feet, or about one-third of leasable space at the shopping center. Plans for those spaces have not been announced. As of Wednesday morning, the mall had at least a dozen business and restaurant vacancies inside.