Sears’ departure from Ala Moana Center in 2014 will result in more than a substitute tenant at the Ewa end of Hawaii’s largest mall; it will mean a significant expansion that will draw more shoppers, and bring a substantial reinvestment in retail.
An expansion of shops in what has been a virtually empty parking lot out to Piikoi Street and up four levels should bring new life to the giant plaza and could play a large role in Honolulu’s economic recovery.
Chicago-based General Growth Properties Inc. distributed its plan at last month’s International Council of Shopping Centers conference in Las Vegas, where shopping centers solicit prospective tenants. The trade event reportedly drew more than 32,000 attendees with a mood considerably more optimistic than in recent years.
For good reason. The event came amid the growth of the strongest sector in retail emerging nationally from the Great Recession, reports CoStar Group, a large provider of information services to commercial real estate professionals. Job creation and economic growth are luring more consumers into shopping centers across the country, according to CoStar.
When Sears announced in March that it would close its store at Ala Moana, the assumption was that General Growth would merely invest $500 million to buy back Sears’ lease to the 340,000-square-foot space and find more profitable use.
What has been known by some as "the tired end of the mall" at Ala Moana instead will be renovated and expanded to nearly 700,000 square feet of new stores and restaurants, according to General Growth’s plan.
It calls for a three-level anchor tenant with an entrance on Piikoi and a new fourth-level parking deck near the Hookipa Terrace.
"Sears as a retailer, with all due respect, hasn’t maintained the same level of excitement as some of the other tenants that have come into the mall," said Jeff Arce, a partner of The McNaughton Group, a local developer. "They can really upgrade and create a more dynamic and exciting retail component."
The scenario coincides with plans for development of skyscraper housing in nearby Kakaako and the final stop of a 20-mile rail line planned from Kapolei with stations through much of Honolulu.
The addition to what are now 300 stores and restaurants, including Hawaii’s only Neiman Marcus, should produce an extra lure for Oahu residents and for Waikiki tourists, who are rising in number. The timing couldn’t be better.
"What this means for Hawaii is more jobs in the retail section," said Mark Storfer, chief operating officers of Hilo Hattie and president-elect of Retail Merchants of Hawaii. "It’ll create more selection and competitive choices for the consumer. It’s going to add dozens, maybe 100, new stores depending on how they configure it."
General Growth is making no public comment yet about its plans for Ala Moana, but the information obtained by the Star-Bulletin’s Kristen Consillio affirms that the country’s second-biggest U.S. shopping mall owner is confident about the success in its investment.
