Crystal Mall seen as suitable for mix of commercial, residential development
A dying mall near the junction of two interstates and within hailing distance of a transportation hub might be ripe for what planners call “repurposing.”
If that mall is in a growing, well-populated area that’s short on housing, particularly affordable housing, that repurposing might involve a “highest and best use” that includes a mix of commercial and residential components.
Count Waterford First Selectman Rob Brule among those who believe Crystal Mall is such a mall.
“Given the demographics, the location ― it's an incredible location ― near public transportation, I-95, I-395,” Brule said early last week. “If we can have a vision of what we want there, I think the Planning and Zoning Commission would entertain quite a few things.”
He said the mall’s vast parking lots need to be “greened up” and there needs to be a focus on “recreation for kids and families.” He said the site is “perfect” for affordable housing.
Brule made the comments during an interview days before the outcome of a change in Crystal Mall’s ownership became known. A deed filed Thursday with the town clerk’s office revealed Namdar Realty Group, a Great Neck, N.Y., real estate investment firm with a penchant for acquiring struggling properties, had landed Crystal Mall at auction last month, submitting a winning bid of more than $9.5 million.
Namdar Realty’s news clippings indicate it and its partner, Mason Asset Management, also of Great Neck, have little interest in repurposing the malls they acquire. As of Friday, Namdar representatives had yet to discuss their intentions with town officials.
Neither Brule nor Namdar responded Friday to requests for comment.
“Economically, what they’re doing makes sense,” John Clapp, professor emeritus of real estate at the University of Connecticut, said of Namdar. “Bottom fishing, they get in at a very good price for the amount of real estate they’re getting. They keep the restaurants open, a few stores, then they go to the town to get a reduction in taxes so they can afford to hold onto it, waiting for something good to happen.”
Since 2019, Namdar, which owns more than 60 U.S. malls, has acquired three in Connecticut, in Enfield, Meriden and Trumbull, and has continued to operate them as malls.
If Waterford has a plan of development for Crystal Mall, the town eventually may have to buy the property itself to pursue the plan, Clapp said, as the City of East Hartford did in acquiring an abandoned Showcase Cinemas on Interstate 84, once pitched as a casino site.
Clapp, who has studied and written extensively about the subject, said he expects malls, battered by consumers’ turn to online shopping and the impact of the COVID-19 pandemic, will continue to decline, especially enclosed ones like Crystal Mall, which he said need to generate lots of traffic to pay heating and air-conditioning costs.
“Open-air malls do a lot better,” Clapp said.
De-malling the mall
In Woburn, Mass., a city of 42,000 residents nine miles north of Boston, a mall repurposing has become something of a model for communities elsewhere.
The Woburn Mall, about the same vintage as the 39-year-old Crystal Mall and less than half its size, was “well past its prime,” Mayor Scott Galvin said in an interview, when Edens, a national real estate owner, operator and developer, approached the city with a plan to turn the mall into Woburn Village, a mix of commercial and residential development. Backed by the City Council, the transformation advanced apace, starting with Edens’ 2017 acquisition of the site in a direct sale for $44 million.
Ground was broken in 2019 and, despite the pandemic, construction was largely completed by the end of 2021. By last summer, virtually everything was in place.
In a 2022 report, “Rethinking the Retail Strip,” the Metropolitan Area Planning Council, a regional planning agency that studied more than 3,000 strip malls and shopping centers in Greater Boston, put it this way:
“Woburn, like many other cities, was facing a host of other pressures (besides changing consumer tastes): increasing housing demand, a need to grow the tax base, and a desire for more placemaking and character. The mall’s decline was not helping. It was no longer the financial asset for the City that it had been, and it was devolving into an eyesore.”
Today, Woburn Village is an attractive mix of commercial space ― including connected retail stores as well as freestanding restaurants, a bank branch and other buildings that help break up the parking lot ― green space and two six-story apartment buildings containing 350 rental units, 25% of which are categorized as affordable. A half-dozen stores are attached to the apartments. Commuter rail is a mile-and-a-quarter away.
Market Basket, a popular local grocery chain, and a T.J. Maxx/HomeGoods store, two Woburn Mall holdovers, anchor the retail portion of the property.
Mark Vaughan, an attorney for Edens, said the apartments at Woburn Village supply customers for the stores and restaurants.
“Restaurants have become the equivalent of new (mall) anchors,” Vaughan said. “With the slowdown in the apparel and retail businesses, restaurants have become the new draw. They bring in a lot of activity.”
On a recent Tuesday afternoon, the traffic at Woburn Village’s Tavern in the Square restaurant was brisk. The mall parking lot was nearly full.
The repurposing involved a fair amount of demolition. The retail portion was rebuilt without any interior corridor, a staple of traditional malls. Each of the stores is only accessible from the outside.
Galvin and Tina Cassidy, Woburn’s planning board director, said the project has been a resounding success, having encountered little opposition, aside from traffic concerns, during the permitting and approval processes, and proving to be a boon to the city’s housing stock and tax base.
Galvin said the mall, valued at $40 million in the city’s 2017 fiscal year, was valued at about $80 million in fiscal 2023, a figure he said could eventually go as high as $85 million to $90 million.
“For us, it’s worked out really well,” Galvin said of the repurposing. “We’re in a good location, where I-93 and I-95 meet. We have a lot of amenities, good schools, a low tax rate …”
If there’s been a downside, it’s that families with children who’ve settled in the Woburn Village apartments have had a greater-than-expected impact on school enrollment, Cassidy said, since many of the tenants are new to Woburn.
Ryan Leeming, Edens’ vice president of development and construction, said Woburn Village was the product of a three-way partnership among Edens, the city and the state, whose 2004 Smart Growth Zoning Overlay District program, known as “Chapter 40R,” encourages municipalities to create dense residential or mixed-use zoning districts for developments that include a high percentage of affordable housing units.
By taking advantage of the program, Woburn qualified for $1.4 million in incentive payments from the state. And, under state law, because 25% of Woburn Village’s 350 rental units are deemed affordable, the city can apply all of the units against the requirement that 10% of the city’s housing stock be affordable.
Cassidy said that since 2012, Woburn has added close to 1,500 residential rental units, counting those built, those under construction and those for which permits have been approved. The 350 units at Woburn Village put the city over the 10% threshold. The city now stands at 11.5%.
Tenants of the affordable units at Woburn Village ― AvalonBay Communities developed and owns the residential component ― must have incomes of less than 80% of the area median income, which for Woburn is $46,000 for an individual and $92,000 for a household, according to Cassidy. Affordable monthly rents for one-bedroom apartments at Woburn Village exceed $2,000.
Despite the success of Woburn Village, Leeming, the Edens executive, is not ready to sound the traditional mall’s death knell.
“Malls are not obsolete,” he said. “Plenty of traditional malls are successful in places all over the world. But they don’t work everywhere. I don’t think retail is dying by any means. It’s evolving.”