Denver prepares to add housing to 3 major shopping malls

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With three shopping destinations poised to undergo significant renovations to add housing and reduce retail space, the Denver metro is part of a national trend to convert traditional shopping centers into multi-use properties.

The change illustrates the convenience of living, working, and playing in one area, says Stephanie​ Cegielski, vice president of research and public relations for the International Council of Shopping Centers.

“It’s not an online vs. in-store shopping battle,” Cegielski said. “Before the pandemic, human beings were very social people, and now we’re seeing that need to have the interaction of shopping in person return.”

During the past 20 months, shopping has continued to evolve, with people shopping in-store or online and picking up items at stores.

“That’s not likely to change, but in the next five years, we will see the continued evolution of shopping malls,” Cegielski said.

The increasing need for housing in major metro areas is driving the change.

David Garcia, policy director at the Terner Center for Housing Innovation at the University of California at Berkeley, told the Denver Post converting former mall space into housing is an “emerging trend” in urban areas.

“There is such a demand for housing,” Garcia said. “It follows the trend of trying to put existing land to the highest and best use.”

Significant changes are coming for Aspen GroveCherry Creek Shopping Center, and the Streets at SouthGlenn.

Aspen Grove

 

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The Tattered Cover book store at Aspen Grove.(Courtesy The Gerrity Group)

Littleton City Council voted 4-3 in early December to allow California-based Gerrity Group to cut retail space to provide room to build housing. BusinessDen reported Gerrity Group could trim existing retail space from 270,000 square feet to 125,000 square feet to add 2,000 residential units.

Councilmember Scott Melin said although he favors projects that blend housing with retail, he worries the proposal would cut the amount of sales tax the mall generates.

BusinessDen previously reported the mall generated sales tax revenue of over $2.5 million annually in 2007. Materials prepared by Littleton city staff for the December meeting showed sales taxes trended down before plunging to $1.5 million during the pandemic. City staff estimated redeveloping the property could increase sales tax revenue to $2.34 million.

Without making changes, the mall’s sales tax revenue would continue to decline to about $900,000 per year, BusinessDen reported.

Gerrity Group’s plans indicate redevelopment will make the mall, including tenants Apple, Alamo Theater & Drafthouse, Pottery Barn, and Tattered Cover bookstore, easier to navigate. In addition to building “a diversity of housing options” for various ages and income levels, the redevelopment also could include a hotel.

Cherry Creek West

 

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Proposed concept for Cherry Creek West.(Courtesy Cherry Creek West)

East West Partners, a Denver development company, plans to spend $1 billion redeveloping about 13 acres near Cherry Creek Shopping Center into a mix of housing and office space.

The east side will remain a traditional shopping mall with about 160 stores and 40 restaurants. Stores include Le Creuset, The North Face, the Apple Store, Louis Vuitton, and Neiman Marcus.

The west side, which has been mostly vacant for several years, has more of a big-box feel, BusinessDen reported.

East West Partners plans to demolish those structures and replace them with a possible layout that would include seven buildings, parking, and a large grassy lawn surrounded by walkways.

Amy Cara, Denver’s managing partner for East West Partners, told The Denver Post that the site, called Cherry Creek West, hasn’t met its potential.

“This is a site we’ve had a lot of interest in because it’s really the gateway to Cherry Creek,” Cara said.