Why is it, like an inebriated Texas hold ’em player, municipal bodies never seem to know when to cut their losses? I understand we frail humans have a hard time letting go of things, but aldermen really oughtta know better.
The most recent example of this special lack of foresight comes at the hands of the St. Charles City Council who, despite an all too obvious DNR order, believe they can bring the Charlestowne Mall back back to life. And you thought Dr. Frankenstein faced a daunting task!
Giving a new definition to the word “optimist,” that group is willing to bet $20 million in sales tax receipts – the largest incentive package ever offered by the city – that it’s gonna happen.
And the folks who purportedly will bring it to pass, Krausz Companies of San Francisco, want to downsize and rework the virtually empty mall, renaming it, “The Quad St. Charles.” Yikes! That doesn’t exactly say “retail” to me. It sounds a lot more like something you’d find on a college campus.
Despite all that wishful thinking, it isn’t going to happen and here’s why:
1. The mall concept is dead. That’s especially true of indoor malls which were never a great idea to begin with. And you’d think St. Charles would’ve learned from the west side St. Charles Mall debacle. The crown jewel of Fox Valley retail, the Geneva Commons, has never lived up to its expectations having gone into default in 2013. One local official told me that, though they’ll paint a pretty picture, considering the vast concessions, the Commons has become a huge albatross hanging around the City of Geneva’s outstretched necks.
2. The big box store concept is dead. Most malls rely on “anchor stores” to attract smaller tenants and their day is rapidly fading. We’ve already lost Circuit City, Borders, CompUSA, and Blockbuster. Now Sears, J. C. Penney, K-Mart, Best Buy, and Barnes and Noble are in their death throes. So why pay a huge mall rent when there are so many storefronts already available? The vast irony is that Charlestowne has actually managed to hold onto Von Maur, Carson Pirie Scott, and Kohl’s, but their vacancy rate still sits at a lofty 90 percent.
3. The plan won’t work. Though Krausz appears to have a decent recovery track record, will someone please tell me how downsizing the mall, adding “out-buildings,” creating a more “town square” look, and giving it a really bad name will attract new retail? Developer Dan Krausz, a master of understatement, told the city they needed that extra cash to offset the “negative goodwill” the site had already earned. Good luck with that!
4. The Internet’s still here. This project is already behind the eight-ball before the first shovel hits the ground. Brick and mortar stores continue to fail to grasp the concept of customer service and they don’t understand how to use the power of instant gratification. Thus, the Net will continue to chip away at local retail with every breath we take.
5. Randall Road is still there. Though they have their own problems, it’s still some serious competition.
6. The market always has the final say. I’ve said it before. If the market could bear the kind of development we’re discussing, it would already be there. This is why TIFFs generally fail. Politicians just love to wax poetically about the “free market” until it kicks them squarely in the ass. And, for all the reasons we’ve already mentioned, it’s about to do just that to St. Charles.
So even as the housing market makes a major rebound, it won’t stop the city council from eagerly applying their rose colored glasses and unanimously approving a plan to keep this comatose patient on life support.
I wonder if I could con ’em into a poker game?