New Horizons Mall open... and empty

[CorsiHockeyLeague]

In the meantime, I'm thinking you could run a pretty decent go-kart track through that underground parking lot. Or a street hockey tournament!

[csnarpy]

Originally Posted by CorsiHockeyLeague

In the meantime, I'm thinking you could run a pretty decent go-kart track through that underground parking lot. Or a street hockey tournament!

Lol, first thing that came to mind was "This would be an incredible new speeders"

[CaptainCrunch]

Load it up with professionals with paint guns, smash up the place a bit and make it a huge indoor zombie zone, paint ball arena, live action MMO

[J pold]

Originally Posted by BlackArcher101

Comes down to greed and speculation. The concept for the mall has worked elsewhere, and I'm not entirely sold that a big reason for the failure is the location (they were saying the same about CrossIron). The issue here is how they were sold. Instead of invoking a requirement that all sold spaces be occuplied by a certain date or turned back over... they had nothing. Pretty much all the spaces sold to speculators, looking at them as investments and saw $$$ thinking they could then lease them to these small store owners. Except then the lease rates are stupid high, and just are not feasible, even approaching rates in existing malls. In low margin stores that were being marketed, it's just not an option. This should have been restricted so that costs were kept low and store owners actually owned the space.

Developer must be laughing. He's been paid by all the investors and his end of the deal is done now that the building is complete. Lots of people got conned.

edit: Here's a good article on the problem https://calgaryherald.com/business/l...remains-upbeat

Pretty much this. The developer of the project is fine. It's the purchasers of individual units that are left with the obligation. I've heard that a good portion of the money came from Vancouver. Commercial real estate prices there are insane (think the housing market at 10x the scale) so buying retail units in Calgary for $400/SF probably seemed reasonable.

I've also heard that it's being managed as a condo complex which is to say that each unit has their own strata ownership for the project. The administrative and legal nightmare for the entire project to go under will be ugly and and very long so I wouldn't imagine any paint ball arenas anytime soon.

[OldDutch]

It looks like some large comerical lease companies own those units. So I’d imagine as long as “condo fees” keep coming in the lights will stay on.

The issue becomes finding critical mass, adding one or two stores a month won’t cause anyone to drive up there. In the meantime the small owners bleed money and maybe fold. They need to find a way to get stores open en mass, not hard if they were mall chain stores that are equipped but mom and pop, no way.

Quite the pickle this has turned out to be. How the large lease companies got fooled here will make a great case study one day.

[clubspecial]

Originally Posted by J pold

Pretty much this. The developer of the project is fine. It's the purchasers of individual units that are left with the obligation. I've heard that a good portion of the money came from Vancouver. Commercial real estate prices there are insane (think the housing market at 10x the scale) so buying retail units in Calgary for $400/SF probably seemed reasonable.

I've also heard that it's being managed as a condo complex which is to say that each unit has their own strata ownership for the project. The administrative and legal nightmare for the entire project to go under will be ugly and and very long so I wouldn't imagine any paint ball arenas anytime soon.

Give it a couple years, it'll fill up.

[BlackArcher101]

Originally Posted by clubspecial

Give it a couple years, it'll fill up.

At this rate, more than a couple.

[Snuffleupagus]

Originally Posted by OldDutch

It looks like some large comerical lease companies own those units. So I’d imagine as long as “condo fees” keep coming in the lights will stay on.

The issue becomes finding critical mass, adding one or two stores a month won’t cause anyone to drive up there. In the meantime the small owners bleed money and maybe fold. They need to find a way to get stores open en mass, not hard if they were mall chain stores that are equipped but mom and pop, no way.

Quite the pickle this has turned out to be. How the large lease companies got fooled here will make a great case study one day.

Torgan started selling units early 2015, a friend of a friend paid $215k for a small unit around 170 sq ft.

Meanwhile in that time period Amazon's stock price went from $300.00 to $2000.00. Could have been a tidy little $1.2m profit.

Seriously though, Malls are going the way of the Dodo, retail business is going to E-commerce players. And none bigger than Amazon. It is now far easier to navigate the internet for what you want than negotiate freeways, parking lots and crowded malls. I think stand alone clothing stores and food stores will survive the longest but the rest will be toast in the near future.

[Northendzone]

it will be interesting to see if the concept of this mall ever really takes off.

i like going to cross iron mills; however, i hate driving there. I live in the deep SE, so just the drive there is 30 or so minutes; however, the part that I find the worst is that getting there off of the QEW seems to involve a series of left turns, and leaving the mall to get back on tot he QEW involves more lefts and sometimes that one road can back up for quite a distance.

I will concede that I don't go tot eh mall enough to completely understand the roadways, so perhaps I could make a better route, or perhaps they designed the mall that way.

to me going to Cross Iron and this other mall involves the majority of a day, and while I enjoy buying new stuff, that is a lot of time and energy, when I could likely go someplace else like south Ctr and save a load of time and energy.

i feel for the retailers that are currently in this mall.

I'd have to think that in some twist of irony, that the few opens stores are likely not located close to each other thus forcing shoppers to wander for distances to shop.

[Fuzz]

Ya, I don't know why they didn't make the exit to the mall just after the overpass, and have it just connect to the ring around it. Then you wouldn't have a light and a left turn that backs up to the highway and prevents me from getting to Blue Grass! They could have made the west side of the ring clockwise only with right hand exists to the mall. Keep the left lane free flowing for the most part so that you can get around quickly. Then to exit to Calgary you use the south one, skip the light and just have a right lane back to the highway.



I don't care about Northbound traffic, because they are probably going to Airdrie. But I'm sure that could be handled with this setup as well, using the north exit. Just means a couple of lefts.

[bizaro86]

Time won't organically fix this. If they're opening a few new stores a month, they'll never reach critical mass, because the ones who are already open will start going out of business due to lack of traffic.

They need to open a bunch at once, hold a big grand opening, and get launched. Tough to coordinate that with multiple owners...

[Resolute 14]

Yeah. The only thing that's going to save that mall is for one party to buy a large number of units and fill them.

[Mazrim]

Originally Posted by Northendzone

i like going to cross iron mills; however, i hate driving there. I live in the deep SE, so just the drive there is 30 or so minutes; however, the part that I find the worst is that getting there off of the QEW seems to involve a series of left turns, and leaving the mall to get back on tot he QEW involves more lefts and sometimes that one road can back up for quite a distance.

Your problem seems to be that you're trying to go through Ontario to get to Cross Iron, as the QEW is between Toronto and Niagara Falls.

[Fuzz]

Originally Posted by Resolute 14

Yeah. The only thing that's going to save that mall is for one party to buy a large number of units and fill them.

The real question is fill them with what? I have no idea what product would make sense here.

[Sainters7]

Originally Posted by Amethyst

The video is annoying. I'm not sure why it needs to be so long. The mall is empty, end of story.

Haha totally. Dude definitely loves to film himself and hear himself talk. I made it maybe one minute into that before I got the gist and shut er down.

Pretty crazy story though, I actually hadn't heard of that before.

[Resolute 14]

Originally Posted by Fuzz

The real question is fill them with what? I have no idea what product would make sense here.

Honestly, it was envisioned as a high rent flea market.

Basically, whatever is in this mall: https://www.pacificmalltoronto.ca/

[Wormius]

I still think office space for small business guys. Maybe some bike guys can put a repair shop, a couple spaces dedicated for makers, software developers who want something a bit better than working in their basements. It would be a good incubator space for people with not enough money to get a real office space.

[The Yen Man]

I was surprised when the project actually broke ground a couple years ago. I think there were a lot of people questioning the viability of the mall even when the concept was floated around, so it's not like they can say this comes as any surprise.

Which is too bad, because I was hoping they'd be able to turn it into a muticultural mall, with lots of nice food options and quirky shops. By the looks of it, that's going to be a long way down the road if it even happens in the first place.

[The Yen Man]

I was surprised when the project actually broke ground a couple years ago. I think there were a lot of people questioning the viability of the mall even when the concept was floated around, so it's not like they can say this comes as any surprise.

Which is too bad, because I was hoping they'd be able to turn it into a muticultural mall, with lots of nice food options and quirky shops. By the looks of it, that's going to be a long way down the road if it even happens in the first place.

[jtfrogger]

I find business stories fascinating. It will be interesting to see what will happen here.

I think some people will be able to turn this into a profitable situation. Not for the original investors, but someone that buys in at the low point and profits as it recovers to a functional mall. It will likely never come close to the original vision, but that doesn't mean someone won't profit.

It floors me that there doesn't appear to be a penalty to owners for having a vacant store. That was the big mistake from the developer. If it is run as a condo, I expect that they will eventually make a change to the by-laws to put this in place. It wouldn't be hard to implement something like this, other than getting the agreement that it is necessary. At some point, enough of the owners would realize that it has to happen to get approval. I expect that it will be hard for them to reach >80% occupancy without a penalty for vacancy.

Other than the articles posted here, I haven't read anything else. But it sounds like the developer is holding on to the anchor tenant spots. If they are not losing money on the rest of the mall being empty, they don't have as much of an incentive to fill those as a traditional mall would. The developer dropping their expectations to reality needs to happen. At some point, they'll sell them at a big loss or fill with a lease for nothing. It may have to be the smaller unit owners kicking in extra condo fees to subsidize some anchors.

I would think that the first wave of businesses going in would be things that have regular customers that don't rely on walk-in traffic. Some personal services could fit in this, such as health services (doctor, dentists, chiropractors, massage therapists), lawyers, accountants, tattoo artists, registry, etc. These types of things suck in a mall, but are still better than vacancies. Because they wouldn't rely heavily on walk-in traffic, it would take less of a discount to convince them them to move in.

My guess is that it will eventually become a functioning mall. But probably very low end stores. You'll get places like low-end importers and/or flea market type shops. The anchor locations will end up being places that use a bunch of space but not really draw people to wander though the rest of the mall. I expect the space will have entertainment locations such as indoor paintball, laser tag, kids gyms, locked rooms, etc.

Anyway, I do look forward to see how this turns out.