By 
January 26, 2017
For more than three decades, Madison Square Mall anchored Huntsville’s commercial corridor along University Drive and Cummings Research Park. The City’s urban development team calls it “ground zero” for retail. The finance department calls it “ground gold.”
At its peak, Madison Square Mall and its neighbors produced more than 20 percent of the City’s total sales tax collections. Its success spawned hundreds of businesses to open in the area, and those retailers and companies contributed healthy revenues for City coffers.
Times change. As more shoppers ventured online for pricing and convenience, large malls found themselves in precarious new territory. Madison Square Mall’s once vibrant retail destination began struggling to capture shoppers, and despite two major renovations in 1994 and in 2006 by its then owner, CBL & Associates Properties, nothing appeared to thwart the downward spiral.
This isn’t just about the mall. If you allow a large commercial center to crater, allow it to die, it can drag down neighborhoods for miles around.”
By 2012, the mall was 70 percent vacant. Sales tax revenues plummeted from $6.5 million to $1.1 million and property taxes declined 75 percent. As stores left, a ripple effect impacted nearby retail strip centers, prompting an increase in overall vacancies in the once robust retail corridor along University Drive. The dreaded appearance of “blight” began its insidious creep, something the City of Huntsville was determined to stop.
“Every mall has a life, and once they have run their course, it’s time to rethink and reinvest,” said Urban and Economic Development Director Shane Davis. “CBL is one of the best run companies in the business, and if anyone could have saved this mall, it was them. They looked at multiple renovating concepts, but nothing was viable long term for the Huntsville market.”
FIRE SALE
In 2014 CBL informed the City they were headed toward a fire sale. Davis knew the City had to move quickly to preserve its commercial corridor and asked CBL to give him a few months to find a solution.
“We reached out to developers and companies to find someone who would be a good partner,” said Davis. “Not just a partner looking to make a quick turn, but someone in it for the long haul who would invest in our community and take pride in the project.”
RCP Companies answered the call. With a successful track record in development, local investment and strong asset partnerships, RCP agreed to purchase the entire mall site and redevelop it into an urban center through a mixed-use project.
Instead of expanding outward, this is about finding places internally that have already been developed and can be repurposed”
It wasn’t an easy task, as often is the case with multi-tenant properties. RCP bought the first piece in late 2014 for $5 million, but that was only the guts of mall. All of the outparcels and anchors were separate tracts with diverse owners, and it took RCP another 20 months to acquire the sites.
GAME PLAN
Unlike many cities, Huntsville has a respectable history of revitalizing its older indoor malls. The former Dunnavant’s Mall at Governors Drive and the Parkway transitioned into the Huntsville Hospital Medical Mall. The Mall (it was really called THE Mall) on North Parkway at University Drive redeveloped into The Fountain featuring Costco, Home Depot, Staples, and Books a Million. Parkway City Mall on South Parkway at Drake Avenue successfully renovated and expanded into Parkway Place Mall.
Mayor Tommy Battle believed the Madison Square Mall site could make the same leap. It wasn’t just the health of retailers in the area that concerned him, record vacancies were also occurring in the adjacent Cummings Research Park East. The fringe areas looked dated, and that meant companies, hotels, restaurants and businesses would be locating elsewhere.
The Mayor turned to The BIG Picture master planning process, and found public opinion matched what the planners and economic development teams reported from their research and data dives. CRP East and the Madison Square Mall area were two key areas that needed priority attention.
“We listened to our citizens and we had willing partners in our Chamber of Commerce, CRP Board and RCP Companies ready to step up and address these signature areas of our City,” said Battle. “Now we needed to do our part.”
The solution came in the form of an Urban Renewal and Redevelopment Plan, approved by City Council in February 2016. Designed to “reset” properties identified as suffering from blight by investing in infrastructure improvements, the plan focuses on 500 acres in CRP East, including property north to University Drive and south to Old Madison Pike.
“We’ve divided the area in to five priority zones with Madison Square Mall being number one,” said Davis. “The mall redevelopment does two things. It stabilizes a critical retail corridor for the City and nearby UAH, and provides a catalyst for reinvestment in CRP east and the neighborhoods that surround it.”
The BIG Picture planners say this form of urban stabilization and reinvestment goes even further in preventing suburban sprawl, preserving the environment, and repurposing land that has already been developed.
“Instead of expanding outward, this is about finding places internally that have already been developed and can be repurposed,” said Dennis Madsen, Long-Range Urban Planner. “Reusing what we have – land that has already been cleared with water and sewer in place.”
Madsen says a big focus of planning policy in cities throughout the country is determining the next life of aging and underperforming malls and strip centers. He believes the urban renewal model at Madison Square Mall could be a prototype for other areas of the City.
“This isn’t just about the mall,” said Madsen. “If you allow a large commercial center to crater, allow it to die, it can drag down neighborhoods for miles around. It’ rarely financially feasible for these properties to return as what they were, so the big question is what are the new uses and approaches we need to get them re-contributing to the health and vitality of the community again.”
MID CITY
RCP had a vision for the Madison Square Mall site and turned to one of the nation’s leading firms specializing in urban innovation and regeneration, Urban Design Associates out of Pittsburgh, Penn., to help draft a plan for a new town center. What emerged is Mid City, a $350 million urban center with a mix of residences, offices, incubator space, retail, dining, entertainment, parks and recreation. The City agreed to fund $12 million in new roads and drainage for phase one of the three-phase project.
RCP has cleared most of the difficult hurdles and has a green light to begin redevelopment. On Thursday, Jan. 26, the company hosted a media tour of the mall’s empty interior to record one last look before it disappears. The City is prepared to begin demolition on the portions of right-of-way it acquired for new roads and drainage. By summer, the community should start seeing the first retail buildings and residential units appear along with construction for the recently announced Topgolf entertainment venue. RCP expects to complete Mid City as early as 2021.
To protect the City’s $12 million investment during phase one, RCP agreed to performance benchmarks and to complete 60 percent of the entire project. They further agreed 70 percent of the retailers locating in Mid City would be “new to market.” They would not cannibalize businesses from other sectors of Huntsville.
“Mid City has created so much energy that we are seeing new development and investment already occurring all along the University Drive corridor,” said Davis. “People see this concept and believe in it and want to be a part of it. It shows the strength of our community and our local economy.”
For Mayor Battle, the project shows Huntsville is proactive and committed to revitalizing its urban core. “We listen to our citizens, watch retail trends, and pay attention to the marketplace,” said Battle. “Twickenham Square, the Whole Foods development, Campus No. 805, City Centre and The Avenue are all examples of urban renewal projects that are breathing new life into our neighborhoods. We’ll continue to use this model across Huntsville to make our city more sustainable for the future – the ultimate place to live, work, learn and play.”
Related stories:
Sears Store at Madison Square Mall to Relocate
City Council Approves Amendments to Development Agreement
Madison Square Mall Photo courtesy of Marty Sellers
