Since General Growth filed for bankruptsy the other day I thought I'd give my impressions on that. I posted the report without giving my take on it. I should state here that my opinions are my own and do not represent those of GGP or its subsudaries. Lately, since the beginning of the year, new tenants have been taking to reusing the walls and not even bothering to remodel when they are moving in. Save a lot of money that way, but gives a rather jakey look.
We have lost several stores in the past couple of months. Z-Galleria pulled out of Missouri and other markets, but is still in business. This leaves a gap on the second level at the Atrium, which is our main entrance court. That kind of detracts but what can we do?
Mark Shale, the entire chain is going under, which leaves a new, significant gap on the north end of the mall. The North end has been a dead zone with the second level having two empty spaces and the former Houlihan's restaurant empty since they moved out a couple of years ago. (Not that I was unhappy to see THEM go. I hate drunks and druggies, which Houlihan's attracted. I get the feeling that the drug dealers used it as a meeting place since there were license plates from all over including a state plate from Mexico).
However, we have had a few move in's. Stacey Adams is a clothing store That moved into the old Discovery Channel Store space. They look like high end, Italian, "Mafia" clothing for men. Some of it looks tasteful, but I am not impressed.
San Francisco Music Box Company moved into the old Disney store space. I must say I am impressed. They were able to reuse the little bit of exterior lighting that Disney left which was a kind of frame around the perphery of the window which has a star effect. When its lighted the stars change as you pass by. They are only using half the space with a frame holding a curtan to the unused portion of the store to the back. Still, its a tennant and its putting money in the Mall. The Music Boxes are really pretty and I hope people buy them.
Toy Tyme is a toy store that usually comes and uses unused spaces every Christmas and is usually gone by Janruary 31. This year, they are staying. Not sure how, but I think the mall is giving them an incentive to stay. They had the Discovery Channel space, but moved into the old Club Libby Lu space when that was abandoned. They sell toys obviously, but they are kind of decoratve, high end things that look good from a decorators standpoint, but I wouldn' let a five year old touch. They sell these realistic looking stuffed animals. Sometimes at night I can walk by and look at the dog sitting and I swear I think the thing is gonna bark! Kinda unnerving.
The construction has stopped which leaves us looking like a construction zone. This huge dirt gap on the parking lot makes us look really bad, but there is nothing really we can do about it. My major concer is taht they stopped the Parking garage expanstion construction literally days before finishing it. They had some minor masionary work to do, space striping and the expantion joints. The expantion joints are my biggest concern since any water that gets into there can cause permanant damage to the structure by promoting rust of the reinforcement bars and post-tensioning cables. It has gone through a whole winter with rainwater and snow being pumped into it by nature. Its going to severely decrease the lifetime of the structure if it isn't fixed. I have to wonder about the mentality of not finishing just that. Its just so idiotic.
Right now, we have two empty spaces on the north end second level. I have already mentioned Mark Shale and the Houlahans spaces. We have the old White House - Black Market space still empty. (They moved into the Brooks Brothers Women's space when Brooks Brothers consolidated all the stores into one). The Z-Gallerie space level two I have mentioned. Then the old Road store, which went out of business before Christmas last year.
All in all, since we have about 165 stores according to the website, we are doing relatively well considering. What will tell will be the next few months assuming that GGP can get its financial act together. In this real estate climate, buyers are few and are looking for bargans. I seriously doubt they will get the $27.5 billion they need to get back to solvency. I seriously think their assets will eventually be auctioned off and there will be developers that will pick up properties for a song. GGP's investors will end up holding the bag for this unfortunately.
There is little sympathy for retail facilities in the present government attitude. GGP is very unlikely to get a bail out even though a large scale closure of its facilites would have a grave impact on retail from coast to coast. The economy would suffer a significant impact if this happened.
So where does that leave us, the workers. It leaves us apprehensive about our futures, and wondering if our paychecks will clear. What can you do?
William K. Black, author of THE BEST WAY TO ROB A BANK IS TO OWN ONE, teached economics and law at the University of Missouri — Kansas City (UMKC). He was the Executive Director of the Institute for Fraud Prevention from 2005-2007. He has taught previously at the LBJ School of Public Affairs at the University of Texas at Austin and at Santa Clara University, where he was also the distinguished scholar in residence for insurance law and a visiting scholar at the Markkula Center for Applied Ethics.
