How much easier is it to build a new Chipotle than repurpose a vacant storefront nearby?

Near our suburban house is a shopping center consisting largely of strip malls and several anchor grocery stores. This development constructed in the late 1980s has fallen had hard times in recent years with numerous vacant storefronts.

Thus, it was surprising to see the construction that started last year at the site of a former national chain restaurant in this shopping center. This spot had been vacant for several years. The building came down and a new strip mall is going up. The new commercial space has an easy turn-in off a busy arterial road.

I have heard that it is easier to build a new big box store than to repurpose an old one. For example, numerous grocery stores in the Chicago region sat empty for years. Some big box businesses have moved out of older buildings and reopened in new structures not that far away.

The new Chipotle building will certainly be geared toward exactly what this business needs. Additionally, there will be at least one new storefront next to the restaurant. The old building had a different layout inside, one more fitting for a sit-down restaurant, and with on additional commercial space.

At the same time, how many strip malls, shopping malls, big box stores, and restaurants are torn down each year because the space they have is not exactly what a different business wants? What happens to all of these materials? How much time goes into tearing down? How substantially are these shopping areas changed by adding a few new buildings here and there? This Chipotle could have moved into a vacant property within the shopping center.

I could imagine more modular structures or incentives for reusing buildings or asking businesses to adapt to existing spaces. But, if it is cheaper or more efficient to tear down one building and redevelop another, then that is what businesses will do.

A suburban hospital creating a medical and commercial district

Northwestern Medicine is developing and opening multiple properties around its hospital in the small suburb of Winfield, Illinois:

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The once-blighted corner now boasts a $38.8 million medical office building designed to anchor the redevelopment of Winfield’s Town Center…

The health system also has built a parking garage and amenities in Riverwalk Park since forming an agreement with the village to inject new life into Winfield’s small-town downtown. Northwestern has set aside commercial and restaurant space on the ground floor of both the parking deck and the medical office building…

Winfield Station, a five-story apartment complex, is almost fully leased, Sorgatz said.

The site that once housed John’s Tavern is available for development directly west of the medical office building. The restaurant owner closed the business in 2017 after deciding to retire. Northwestern purchased the property.

The hospital and the town have not always seen eye to eye.

This story highlights the potential for a hospital to drive redevelopment. The hospital has money, nearby property is available. The new projects can theoretically benefit everyone: the hospital needs space, the village has property that would benefit from new buildings, the municipality can get more tax revenues, community members could hold jobs.

Bigger question: should hospitals drive development and redevelopment? There is a lot of money in health care, they provide employment, and they are often a long-term presence. Numerous communities in the United States have long-standing facilities that drive activity and local status. How many communities, cities, suburbs, or more small towns can happily connect in public-private partnerships involving hospitals?

How much time it could take to get the municipal funding to redevelop a shopping mall

As shopping malls decline, finding the money to redevelop the property could prove difficult. Here is the experience of one Chicago area suburb:

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When West Dundee trustees approved a special taxing district in 2016, they were hopeful it would breathe new life into Spring Hill Mall.

The mall showed some signs of hope when a new theater opened in late 2016. Overall, however, the mall stagnated and key anchors closed shop. By 2021, the village saw the property value of its share of the mall drop from a base value of $7.6 million in 2016 when trustees created a tax increment financing district for the mall to $2.5 million in 2021.

Now trustees are considering scrapping the 2016 TIF district and creating a new — and larger — one. The new TIF district would extend to Huntley Road to the north, Route 31 to the east and Route 72 to the south and would take in a Jewel grocery store to the west. And much like in 2016, officials are hopeful a new TIF with larger borders and a lower base property value would help transform the mall…

Despite the failure of the first TIF district, developers have indicated to village officials the money a TIF district could bring for redevelopment would be key to any transformation of the mall area, West Dundee Village President Chris Nelson said.

A successful TIF can help a municipality capture property tax revenues to put toward redevelopment, often in the form of infrastructure. This means that a developer does not need to pay for some of the necessary improvements – and presumably could profit more.

But, how much time and money is enough to entice a develop to go through with a significant redevelopment? At this point, the first TIF has existed for roughly six years. It did not work as intended; property values fell so there was not tax revenue to capture. Will expanding the district create enough revenue?

TIFs have timelines built into them; they are not intended to last forever. Should a suburb commit to decades for a TIF? At what point does a community throw in the towel in efforts to raise revenue or a commitment to a particular tax structure?

Many communities with shopping malls, big box stores, and other brick and mortar establishments will face these questions in the coming years. TIFs are one tool to use; what other options will emerge as popular and/or successful paths for communities to follow for redevelopment?

Do not call it a shopping mall; call it a campus

With the opening of several hundreds units of housing on a former portion of the Fox Valley Mall, one leader used a different term than “mall” to describe what was unfolding on-site:

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While the mall has been around since 1975, Samson said he even has stopped calling the burgeoning “live, work, play” development by that name.

“Notice how I didn’t say mall,” Samson said. “It’s a campus.”

A shopping mall is primarily about commercial activity. A campus implies something different. Probably the most common usage of the term refers to college campuses. On such a campus, there is a variety of activity: residential spaces, social spaces, academic spaces, athletic spaces, and more.

Many shopping malls are hoping for transformations that help them move beyond just stores and a few eateries. The shopping malls that survive the next decade or two could include apartments, condos, townhouses, hotels, restaurants, entertainment venues, and cultural attractions in addition to stores. All of these options would help make the mall/campus more lively throughout the full day rather than just during shopping hours. In this sense, the goal is not that different than numerous mixed-use developments in suburbs and cities: create a home base of residents plus a steady flow of visitors who spend money and contribute to social activity.

Will the term campus catch on to describe former shopping malls? Time will tell and certain influential actors, such as developers, architects, and local leaders, can help make it happen.

Another suburban Chicago mall goes in on denser housing to revive its fortunes

Yorktown Mall in Lombard is planning to replace a vacant anchor store with hundreds of apartments:

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The department store closings have turned other enclosed malls into retail ghost towns. But Yorktown has sought to reinvent itself by thinking outside the big box…

Pacific is now teaming up with Chicago-based Synergy Construction on a major overhaul of the west side of the 54-year-old mall. Plans call for replacing the cavernous, three-level Carson’s store and its vast parking lot with an apartment complex and a public park. The residential portion of the development will cost an estimated $201 million over two phases, Lombard officials say…

Pacific and Synergy have not finalized a unit count, but village memos indicate the latest project could bring approximately 700 apartments to Yorktown.

“You start having a critical mass of maybe 1,500 or 2,000 new residents,” Niehaus said. “And when you look at the rent rates that the apartments are generating, it typically lends itself to people that have disposable income that will want to shop or eat or participate in activities.”

Not all malls will survive the coming years. The idea behind replacing stores with apartments or housing is that it is a better use of the space rather than trying to chase a dwindling number of successful retail options and adding residents next to stores, restaurants, and entertainment options means they will spend some of their money in the remaining mall spaces.

Will this ultimately be the successful tactic that either saves some portion of the mall or revitalizes/transitions the space from retail to other uses? Housing is needed in many communities with shopping malls. Will communities recoup the revenue that used to come in through sales taxes? Will the footprint of the mall eventually disappear into the sprawling suburban landscape? As noted in the article, this is not the only Chicago mall pursuing this. See the example of the Fox Valley Mall in Aurora. Wait another thirty years or so and the legacy of the suburban shopping mall – roughly a century old at that point – might be very different.

How much a declining mall can cost a community in sales tax revenue: almost $20 million a year

The decline of Stratford Square Mall in Bloomingdale, Illinois meant the sales tax revenue for the community dropped dramatically:

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Stratford was still a cash cow in 2012, generating $20.3 million in sales tax revenue. But that number has quickly dwindled in the last 10 years, with the mall producing just $466,080 in 2021, village officials say.

Dead malls” or struggling malls are a problem in numerous American communities. Popular for decades, these properties provided shopping, entertainment, and social space for visitors, jobs, and tax revenues for communities.

As communities look to transform these properties (and the possibilities are broad), one large factor will be how much tax revenue the new land use generates. Can they ever come close to generating that kind of sales tax revenue? Restaurants and entertainment or experiential spaces can help close that gap. Residences, however, do not bring in that kind of money (unless those new residents shop regularly at local businesses). If not, what other clear benefits will the reconfigured properties offer the community?

McMansions as part of or outside of a changing suburbia?

This description of the changing American suburbs includes McMansions:

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The demand for something like urban living is real. Even at the outer edges of growing metro areas, mixed-use walkable developments pop up alongside familiar subdivisions and McMansions. “Mixed-use centers—often in suburban locations—continue to be built from the ground up in many communities across the US,” wrote the Congress for the New Urbanism in 2019.

As more immigrants and millennials become suburbanites, and as Covid and remote work give the suburbs another growth spurt, they are evolving into something different. Between 2019 and 2020, the share of millennials who live in suburbs increased by 4 percentage points; and in 2014, more than 60 percent of immigrants lived in suburbs, up from just over half in 2000.

Many communities that were once white, exclusionary, and car-dependent are today diverse and evolving places, still distinct from the big city but just as distinct from their own “first draft” more than a half-century ago…

If a “second draft” of the suburbs is now being written — at least in some of America’s growing and expensive metro areas — what might it actually look like?

This is part of the complex suburbia we have today. Where do McMansions fit into this? The selection above suggests “mixed-use walkable developments” are near McMansions. But, what happens to the McMansions in the long run? Here are a few options:

  1. The McMansions continue in their neighborhoods for those that want them. Even amid proclamations that McMansions are dead, there are some homebuyers and suburbanites that want such homes.
  2. McMansions themselves are altered in ways to fit the new landscape. Perhaps they are subdivided into multiple units for more affordable housing. They could be added to. Their properties could host accessory dwelling units.
  3. McMansions are demolished and replaced with something else. This could be because the quality of the homes does not stand the test of time or the land is more valuable used another way (some of the teardowns become teardowns).
  4. Some McMansions live on through historic preservation marking a particular era of housing and American life.

For some, McMansions represent the peak of an undesirable suburban sprawl and excess. For others, they are homes that provide a lot for a decent price. Their long-term fate is to be determined both by those who like them and those who detest them as the suburbs continue to change.

How many suburbs will be willing to replace suburban office parks with denser housing?

If the golden age of the suburban office park has passed, what will some of the empty properties be used for? One option is denser housing:

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It will mean taking land long zoned for offices, and allowing townhomes to be built among them, or permitting apartments or industrial-scale warehouses for the first time. Amid a nationwide housing crisis, many obsolete office parks could be ideal sites for denser housing.

However, this is a very pertinent issue:

The problem for some suburban officials: “It’ll be, ‘Oh, what do you mean we can’t just zone for single-family homes and offices? That’s our thing. That’s why we exist,’” said Tracy Hadden Loh, a researcher at the Brookings Institution. “So now it’s like an existential crisis.”

This is an issue that comes up for numerous kinds of large suburban properties, whether they are shopping malls, golf courses, or grocery stores: how to convert a vacant property into a useful long-term use? The number one goal is probably to generate significant property tax and sales tax revenue. In other words, to keep it at its original as approved by the community years before.

But, if that is not possible – and communities might go years trying to fulfill this vision – then the discussions get interesting. Expensive single-family homes, fitting with the upscale suburban character of some suburbs, would fit in. Zoning protects single-family homes for a reason: suburbanites and suburban communities prefer these homes and their lifestyle.

However, single-family homes can bring more children to local schools and add to the loads of local services. They do not necessarily produce the revenues that offices and retail do. Denser housing is even less desirable because it adds even more residents, which can add to community services and traffic, and some suburbanites are concerned with apartment dwellers.

My guess is that mixed-use redevelopment will be a popular path a number of these communities will try to pursue. Replace that office park with a “metroburb.” But, it remains to be seen how many such developments are viable and how eager suburban leaders and residents are to pursue them.

Limiting landmarked buildings in a suburb with a history of growth

Naperville, Illinois experienced explosive suburban growth after 1960. With demand still high for development in Naperville, evidenced by hundreds of teardowns and rising rent prices, the city council does not appear to have much appetite for landmarking buildings:

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On the heels of the Naperville City Council’s decision to deny landmark status to the downtown Kroehler YMCA facility, officials are proposing changes to the city’s landmarking procedures.

The changes, which need city council approval, are intended to reduce the impact on property owners and make it more difficult for applicants to achieve landmark status for structures.

The idea of forcing landmark status on property owners emerged as a key issue in February when the city council voted 8-1 to reject the request by Naperville Preservation to landmark the Kroehler YMCA against the owners’ wishes. The vote freed the owners to demolish and sell the site.

After numerous speakers at last week’s city council meeting debated the idea of creating more-stringent landmarking regulations, and based on recommendations by Councilman Ian Holzhauer, city staff was directed to return with an ordinance preventing individual citizens from applying for landmark status.

For at least several decades, historic preservationists in communities across the United States have argued that older buildings are worth preserving. Acquiring landmark status is a way to help ensure the structure retains its original form even as neighborhoods and streetscapes change.

It is less clear how well historic preservationist arguments work in suburbs where communities can be used to growth and the rights of individual property owners can reign supreme. As suggested above, landmark status can be seen as an impediment to property owners who can profit from changing or selling a property. Why save an older structure when there is money to be made and progress to be pursued?

If this logic wins out in suburban communities, how many older buildings will remain and in what format? It is one thing to save older buildings and move them or recreate them in a historical museum setting. It is another to preserve important older structures that mark important community locations even as communities continue to change.

Transitioning a glittering downtown shopping mall to a more experiential space

Water Tower Place on North Michigan Avenue has fallen on hard times, as have many malls, and plans are underway to revive the property with new uses:

In consultant-speak, today’s juice is “experiential” retail. It means that people not only want something they haven’t seen before, but they want an experience to go along with their purchase. The Apple Store and the Starbucks Reserve Roastery further south on Michigan Avenue are examples of that — places where shoppers come to see and feel as well as to buy. A pop-up show called the “Dr. Seuss Experience” filled Macy’s former space in Water Tower Place this winter. Down the street, a “Museum of Ice Cream” is opening at the base of the newly renovated Tribune Tower this summer…

But she and her colleagues are already thinking big. A report titled “North Michigan Avenue: Strategies for a Vibrant Future” issued in March by a group of business and city leaders envisions a grand promenade running from the historic limestone Water Tower, past the Museum of Contemporary Art, to the lake along Chicago Avenue; and a soaring pedestrian bridge stretching from Michigan Avenue, over DuSable Lake Shore Drive, to Oak Street Beach. The bridge, modeled on a structure in Moscow, would make it possible to see and get to Lake Michigan from the Mag Mile without descending into dank tunnels under the beachfront drive.

Also in the report: a more run-of-the-mill property tax on landlords raising about three quarters of a million dollars passed the City Council this year; it will be used for cultural events like “Music on the Mile” and for security cameras. The city also awarded Bares’ group money from a federal grant to deploy a team of uniformed “ambassadors” — unarmed security personnel with radios to help tourists, assist the homeless and report criminal activity on the Mag Mile — starting in June.

But most of the report is focused on getting people excited about going downtown to enjoy attractions such as music, art and culture, and Water Tower Place recently scored its own big get on that front. In April, the world-renowned Hubbard Street Dance Chicago surprised everyone and moved from a temporary home on the North Side into the mall’s fourth floor.

For years, shopping in a lively context was enough “juice” to bring in both serious shoppers, curious shoppers, and other visitors. Shopping was one of the most popular activities for Americans and the glamor of a downtown mall plus at least a decent-sized crowd would make it feel exciting.

Now that shopping is decoupled from physical space, these former shopping spaces do not have enough “juice.” They need more experiences, ranging from music to arts to unusual sights to places where people can post intriguing social media images.

Can cities and communities be flexible enough to shift spaces and experiences? And how many experiential areas can there be? On the first question, communities need to open to how spaces might be used in different ways when conditions change. Shopping malls may have worked for decades and brought in significant revenue, but when they struggle, what is next? For the second question, Chicago already has some of these experiential spaces: Navy Pier, the Museum Campus, a Riverwalk, and other concentrations of interesting activity. Can these work together in that a visitor could access several of these in a single day or trip or at some point do they start competing against each other?

The decline of in-person shopping is a big deal and a shift that many communities are struggling to address. Those who find successful alternative uses for these shopping spaces and also develop a mindset of needing to refresh certain places may just come out ahead.