El Cajon is reviving a stalled plan to acquire and redevelop Parkway Plaza, citing concerns for the mall’s long-term survival and the revenue hit the city faces if it fails.
Read more Deaf interpreters translate hours of Netflix content into ASL because closed captioning isn’t a fix
“I can’t think of many more economic issues that are more vital to us than a healthy Parkway Plaza,” El Cajon Mayor Bill Wells said. “I’ve been excited by the options that staff has given us and the vision of the future, but it seems to me like we’re stalled out on that process.”
During a July 28 meeting, the El Cajon City Council directed staff to return with an analysis of potential options to acquire Parkway Plaza.
A once-thriving commercial and social hub, the mall was one of the city’s top tax revenue sources during its heyday.
Late last year, city officials announced their plan to possibly secure ownership of the shopping center, noting concerns over shifts in ownership and major roadblocks in their redevelopment efforts without having an ownership stake. They aim to transform the space by turning it into a mixed-use site for shopping, housing, social gathering and transit access.
Positioned on an 80-acre plot, Parkway Plaza is the city’s largest shopping center. The mall opened in 1972 and has recently seen a shift in ownership.
Starwood Capital Group lost ownership of Parkway Plaza in 2020 after defaulting on Israeli-held bonds. It was then acquired by the current owners, Pacific Retail Capital partners and Golden East Investors.
“I think we’re being, in a way, held hostage by owners and I’d like to see what we can do to revitalize Parkway Plaza and bring it back to… a viable economic area,” said Deputy Mayor Michelle Metschel, who initiated the staff recommendation alongside Wells.
In March, city officials advanced several efforts related to the potential acquisition, including securing a land-use planning grant and hiring a consulting firm to explore funding options.
The city has not announced a formal appraisal of the site, but a 2021 market analysis estimated the shopping center’s value at about $150 million. Revitalization of the mall could be expected to increase the city’s annual revenues by at least $10 million, according to an earlier report by Hunden Partners.
The process became stalled in recent months, city leaders said, though some meetings took place between the city and the mall ownership in closed session.
Read more Chula Vista council strips State of the City oversight from mayor, hands authority to city manager
“If we don’t do anything we could see six…eight more months go by without any significant movement and I don’t want this to drag out for years,” Wells said in an interview with The San Diego Union-Tribune.
If action isn’t taken soon to revitalize the mall, Wells said, “it will fail eventually.” Further, he said the shopping center’s decline would cause “significant” revenue problems for the city, noting concern that the area would become “a center for homelessness.”
“I’ve been in office for 20 years, and I’ve never pulled the trigger on something like this because I don’t like the idea of it … but we have to be proactive,” Wells continued.
He described the potential acquisition as an act of “eminent domain” that is vital to the city’s long-term economic survival.
In part, advancing the overhaul plan could also motivate the current owners to further their own revitalization efforts, officials said.
Retail Insights, a commercial real estate firm marketing leases at Parkway Plaza, said Kids Empire and Skyzone recently signed on as new tenants.
“The presence of those national brands certainly will make Parkway Plaza attractive to others (businesses) as well,” Councilmember Steve Goble said.
City staff will return to the council with an update on the acquisition efforts, particularly from a land-use perspective, City Manager Graham Mitchell said, noting that specific redevelopment ideas should be put on pause until the city has ownership stake.
“It may not be the same type of mall that we are used to, but I think that it can be more,” Metschel said.
Read more Michael Smolens: Powerlink déjà vu on environment, energy and politics
