It was a hot afternoon in 1983 as I walked by the concrete monoliths and broken water features that adorned the automobile and shopper free zone known as K Street Mall. There was a vacant weed filled lot across from Macy’s and plenty of skate punks and homeless people trudging along K Street in the hot summer sun. This incarnation of K Street Mall was a 1970’s post modern architectural design that promised to lure shoppers back downtown. It didn’t work.
Redevelopment De Jevu
By the late 1980’s there were renewed calls to transform the originally transformed K Street Mall into a shopping destination, again. “Rip out the ugly concrete art that allow vagrants to hang out”, was a familiar refrain. The final result was the Sacramento Downtown Plaza. It was fun to shop at the Downtown Plaza with new stores that were interesting like Gap, J Crew, Banana Republic and Structures. Today, the Downtown Plaza doesn’t look too much different from the K Street Mall I used to frequent: empty stores, no cars, and no shoppers.
Totally tubular suburban malls
The Sacramento downtown business district accused the first mall in Sacramento, Town and Country Village, with siphoning off shoppers in the 1950’s. K Street Mall blamed Arden Fair and Sunrise Mall for its lack of success. Downtown Plaza supporters acknowledge the role that the Roseville Galleria, the Fountains and an expanded Arden Fair Mall have on pulling consumer dollars away from the central core on K Street. Since the late 1940’s, the Sacramento downtown shopping core has fought the suburban shopping malls for attention and shoppers.
It’s a game changer! Really?
It was with particular amazement that I read the laudatory statements by public officials at the sale of
the Downtown Plaza from Westfield Group LLC to JMA Ventures LLC. It has been reported that Westfield had resisted any improvements to Downtown Plaza and had wanted to sell it for the past couple of years. The failure of Westfield to invest in the Downtown Plaza is not the reason why the Plaza is failing. The Westfield Group did not purposely avoid improving the Plaza in an effort to drive the ultimate selling price down. Rather, Westfield could not rationalize additional improvements based on the return on investment.
Do the math
While it is great the Downtown Plaza has a new inexperienced retail mall management owner, that doesn’t change the economics of the situation. Westfield not only has reams of economic and demographic data on all the malls they own and manage, they can also perform detailed comparative analysis between malls. The Roseville Galleria, which Westfield manages, has had a major expansion since opening, is still thriving even through recession, fire and the opening of the more upscale the Fountains right across the street.
It’s all about demographics
You don’t need an advanced degree in retail economics or a powerful research firm on retainer to find the numbers. I went to ZipWho.com and quickly gathered data showing the income disparity between the suburban areas and down town Sacramento.
|Zip Code||Area||Median Income||Median Age||Population|
When you couple current numbers with past performance, it is plain to see that the Sacramento Downtown Plaza is doomed to fail as a regional shopping mall.
Polls are not reality
Some folks will point to the success of 2nd Saturday in MidTown as an indicator of how the Downtown Plaza can succeed. However, 2nd Saturday is only once a month and is more of a party than a shopping experience. People have cited that a poll of consumers said they would shop at the Plaza if they felt safe and it had a larger variety of stores. However, polls are not reality.
I wonder if “feeling safe” is not a euphemism for wanting an all white dominated shopping experience. If you ever read the comments on the Sacramento Bee website you will see how blatant the racism and bigotry is from the Sacramento suburbs. Down town is an urban center with a spectrum of ethnicities and diversity from Sacramento. There is virtually no shopping experience that will attract shoppers who are opposed to rubbing elbows with someone different looking from them.
Decisions are based on numbers
There are people under the illusion that with new management, retailers will flock back to the Downtown Plaza. It’s not the management company, it’s the economics. Westfield already works with Hugo Boss, Tiffany & Co., Brook Brothers and Apple. If they can’t entice these stores to open in Downtown Plaza how is JMA expected to pull them in?
I heart Sacramento
I am a big supporter of downtown Sacramento. It was my escape from bland suburban conformity when I was younger. While it is no San Francisco, Sacramento still has some of same originality and inspiration that can only come from visionary small business people. Governments don’t create urban buzz and critical mass, it is business owners and patrons.
Another shade of gray
There are alternatives for a successful Downtown Plaza. JMA could look at attracting a technology campus similar to what Facebook is building in Menlo Park. They could also try poaching some of the art galleries and eclectic retailers that populate the MidTown area. But a campus situation still leaves the core area vacant after 5 pm and the higher mall rents might be too much for the little shops in mid town to tolerate.
Sacramento Downtown Plaza has a future. But it may not be the future some folks are hoping for in an upscale urban regional mall.