The Humboldt Mall will soon be undergoing a major renovation that will see the indoor shopping plaza turned into large storefronts, with residential townhouses constructed behind it.
In Dec. 2013, Stromiga Real Estate Development, based in Calgary and San Francisco, purchased the mall from FAM Real Estate Investment Trust for $1.85 million.
Stromiga's corporate focus is to purchase properties for turnover projects; in this case, the mall will be modernized into a "power strip centre", a common sight in large municipalities nowadays.
"Their plan is to greatly improve the whole mall," said Doug McMurray of Avison Young, the commercial real estate firm that conducted the purchase.
"They saw a big opportunity with the it because right now, it's hard to find stable tenants for a small market mall. Large strip centres are much more popular now," McMurray said.
The Humboldt Mall has an occupancy of 82 per cent, with major tenants like Smitty's, Tomas The Cook Family Restaurant and Shoppers Drug Mart moving out of the building over 10 years ago, leaving their former spaces vacant to this day.
"The plan for the mall is to make it profitable," said site manager Mel Lamb. "Enclosed malls just aren't working in smaller markets anymore. Stromiga is going to update it, modernize it and majorly increase its profitability. It'll be a better place to do business."
Noting the two large vacancies on either end of the mall that used to house a drug store and restaurant years ago, Lamb said since then, there were other tenants looking to move into the spaces but decided against it in the end.
"With this new mall, people will want to come to it. It'll attract more tenants," Lamb said.
All but one of the current tenants will be staying at the mall after it becomes storefronts; Rohne's Deli & Desserts is closing for business but owner Sarah Rohne has cited her desire to focus on family as the reason for its closure.
"We're renewing our lease," said Sherri Hotchkiss, manager of clothing store Warehouse One. "We're not going anywhere," she added with a grin.
Lamb said, "This will be great for our tenants. Their stores will become front, row and center."
Adding to that, Lamb said one drawback, among many, with the current indoor mall is that because the stores are situated inside, coupled with poor signage outside, their business doesn't get the exposure it deserves. Stromiga's redevelopment will change that, he said.
The first phase of construction will begin in the summer with a complete re-facing of the front of the building. This will be to provide each future storefront with a large frontage, higher than the current mall's dimensions, and exterior entrances, "suitable for tenants to operate in a modern strip mall setting," it was mentioned in a media release. The vacant jut at the east side of the mall entrance, which Smitty's and Tomas The Cook restaurant used to occupy, will be eliminated. Walls will be constructed along the front, west and east portions of the common area (the indoor walkway of the mall) but both current entrances will be kept open so stores' retail sales do not suffer.
After that, the new interior spaces will be constructed, approximately in the winter time, and tenants will begin moving into their new storefront locations in the spring 2015. The back part of the mall and the interior common area will then be demolished, except for the dental office, and the third phase of construction, which involves constructing 13 rental townhouses facing 9th Avenue, will begin."Of course, it's great to add additional housing to Humboldt but it's also nice for the current homes along 9th," Lamb said. "When they look out their front window, they won't have to stare at the back of a mall anymore," he chuckled.
In the end, Extra Foods and The Bargain! Shop will remain in their current spot as the mall's anchor stores but will have exterior entrances like the rest of the tenants; The Bargain! Shop will actually be entirely detached from the rest of the storefront, with a small outdoor pathway between it and the rest of the stores.
Stromiga is keeping the parking lot relatively the same, except for two corner spaces along 8th Avenue that, according to the concept diagram, are being reserved for future tenants, one being a possible restaurant.
The Extra Foods Gas Bar will remain in its current location.
"It's just very exciting for Humboldt," Lamb said, about the mall's redevelopment. "I really like the idea."
The Humboldt Mall first opened in the spring of 1987 with anchor stores Met Mart, a short-lived discount department store that became SAAN store and Ok Economy, a grocery store chain that was eventually bought out by the Loblaws corporation. During its heyday in the late '80s, the mall had over 25 stores but has since seen a decline, with tenants coming and going throughout the years and vacant spots unable to be filled.
An employee of Your Dollar Store With More at the mall, who declined to give her name, said she thinks the renovation will be great for business.
"Our store will be bigger, so we'll have more spaces for products," she said. The dollar store's current space is 4,526 square feet but once moved to their new space as a storefront, will nearly double in size to over 8,000 square feet. "We have a lot of inventory that we can't stock because we just don't have the room right now but we'll be able to do that with our new space," she added.
However, her co-worker, who also wanted to remain anonymous, thinks the opposite of the redevelopment.
"I think it's going to kill business," she said. "Especially during the winter. When it's cold, people come in here to warm up and casually hang out, popping into the stores here. When there's no indoor mall anymore and it's just exterior stores, people will go to the one store they want and then leave. They won't bother with the other ones."
Lamb believes the new exterior mall will in fact bring additional customers in.
"When people are driving by on the highway, they'll see the stores right away. They might think 'Oh, I didn't know the mall had a clothing store' and they'll stop in. This will bring in tourists that would normally just pass on by."
Stromiga has several properties in Canada and the United States; one that has undergone a similar revamping to the Humboldt Mall is the Rochdale Crossing Shopping Centre in Regina. Opened in 1988, it was formerly known as Sherwood Mall, a smaller indoor shopping centre, until Stromiga purchased it in 2008 and redeveloped it into large standalone stores.
Laurie Ell, general manager for NewWest Enterprise Property Group, the company that manages Rochdale Crossing, said the changes that mall underwent a few years ago have been "absolutely, one hundred per cent positive."
"Sure, there were some minor growing pains at first, like the stores temporarily closing because of construction was an annoyance to the customers, or our parking lot getting torn up but we went from a high vacancy rate to all our spaces being 100 per cent leased," Ell said.
She said that the old Sherwood Mall was tired-looking with no curb appeal, but has now been completely upgraded and modernized with three pad sites in the parking lot: an RBC branch, a Tim Hortons and a Jiffy Lube.
Their Co-op gas bar expanded from four bays to eight and the mall's parking lot is jam-packed every day.
"A few days ago, my mom was mentioning to me how she had been driving around the lot looking for a parking space and it took her a few minutes to find one. I said 'Well mom, that's a good thing!'" Ell laughed.
When asked about customers just popping into one store instead of browsing through a few of them (which was the fear of an employee at Humboldt Mall) Ell said it's actually the opposite for Rochdale Crossing.
"Our traffic and customer count have gone through the roof for all our tenants. It's much, much higher than it was as an indoor mall," Ell said. "Before the mall became a large strip centre, we couldn't even get a small dollar store to be viable. Now we have a big Dollar Tree and its business is booming."
Ell said small indoor malls are generally less affordable because of higher rental rates due to the common area, the indoor walkway part that usually plays host to kiosks, kiddie rides and seating areas. Turning a mall into exterior storefronts instead eliminates that cost and at the same time, modernizes it, making it more profitable for store owners.
"The great thing about [Stromiga] is that they truly do care about the tenants and want to support their business," Ell said. "They become really involved in community functions. They're just really great landlords to have."
Mel Lamb anticipates the same success for the new Humboldt Mall as Rochdale Crossing has achieved.
He said, in fact, that there are already prospective additional tenants showing interest in Humboldt's new shopping centre but declined to give specific names.
"The changes to the mall will be like night and day but it's going to be great for the city and for our tenants," he said.
