Upscale Facelift Planned for Santa Monica Place

By Oliver Lukacs
Staff Writer

May 24 -- Hoping to cater to an upscale clientele, Santa Monica Place will undergo a facelift slated to be completed in 24 months that will integrate the struggling in-door mall with the thriving Third Street Promenade via an open-air gateway, mall officials told the Bayside Board last week.

The renovation -- the first phase of a possible eight-year plan -- would also move the existing food court to a third-floor patio with ocean view, requiring the re-shuffling of 15 to 20 percent of tenants currently located near the front of the 540,000 square foot mall, mall officials said at Thursday’s Bayside meeting.

The plan, which will replace many existing stores with “more up-scale” merchants, will initially create more vacancies in a mall that is already “hemorrhaging,” but that is a price the new ownership is willing to pay to realize a long-term vision, said Bayside Board member Henry Lichtman, a top mall official.

“If you’re going to own Santa Monica Place for the next 20 years like we are, then you got to hold space back and take it on the chin to maintain flexibility,” said Lichtman, the vice-president of the Macerich Company, which owns the 23-year-old mall designed by renown architect Frank Gehry.

“We are hemorrhaging,” Lichtman said. “Economically we are feeling the pain, but it’s the right thing to do for the City and Santa Monica Place. We have a long-term strategy.”

Lichtman responded to concerns that the displaced tenants are not being given much time to accommodate the first phase of a delayed long-term plan to tear down most of the mall and extend the Promenade an extra block.

“We’re not going to violate leases, but were going to aggressively pursue new deals, and if that means re-tenanting or moving a lot people, the good news is that’s what we’re good at,” said Lichtman, holding an unlit cigar in one hand.

The long-term strategy is to attract up-scale merchants and other “marquee” or “destination stores” that would distinguish it from the Promenade. “We don’t want to duplicate the Promenade,” said Michael Guerin, the mall’s senior manager of property management.

“Most of our tenants have moved to the Third Street Promenade,” said Lichtman. “If we’re going to be symbiotic with the Promenade, we’re going to have to attract more up-scale or different merchants, and we are anxious to do that.”

Board member Ruth Elwell said the plan would be an “injection of something new, something people are looking for, something that’s not necessarily on the Third Street Promenade.”

Board member Art Harris wondered if the plan included entertainment attractions, “something other than shopping.” And board member Ann Greenspun asked if the plan included stores catering to “everyday life” needs.

Nothing outside of “maybe” a kids play area was planned for entertainment, Lichtman said, and the company was “really not interested” in catering to daily household needs.

“First we have to deal with the fundamentals, and then we’ll deal with what we consider ancillary,” said Lichtman. “But I’ve been doing this long enough, and I’m smart enough to know that things are fluid and will change. So don’t leave thinking this is the final plan.”

Mall officials unveiled their current strategy two months after informing the board that the ambitious plan to tear down most of the mall -- which was given an enthusiastic thumbs up by City officials last year -- would be far too costly.

For the project to pencil out, the City -- which faces a $16 million budget shortfall -- would have to spend $150 million to move the parking underground and extend Third Street to Colorado Avenue, Lichtman told the board

"It's extremely unrealistic," Lichtman told the Bayside Board in March. "They're significant dollars. I don't think it's going to pencil out, ever."