Ontario Mills remains the region's largest mall, but a lack of updates could leave its share of the retail market vulnerable to trendier, newer centers.
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| Ontario Mills is an island of shopping opportunities set in a sea of parking spaces, and city officials wonder whether some of that land would be better used as mall-adjacent housing. |
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Enclosed and surrounded by massive parking lots, Ontario Mills introduced Californians to GameWorks and Dave & Buster's and the idea that a mall could share movie theaters, restaurants and outlet stores in one large, flat circle.
The economic impact of the mall, now nearly 10 years old, can be seen all around it -- blocks of stores and restaurants that bring big sales-tax dollars to the city.
While Ontario Mills' success showed the region was ripe for new retail, the arrival of Victoria Gardens and The Promenade Shops at Dos Lagos in Corona has added pressure to freshen its look and offerings. City officials, analysts, shoppers and retailers say Ontario Mills could use everything from a new coat of paint to high-rise housing.
Sue Oxarart, the acting general manager, said costly repairs sometimes get in the way of improvements.
"It's just like anything else, like any other kind of real estate. There's a list of things that need to be done. It's constantly being worked on," she said.
A buyer could be on the way as mall owner Mills Corp. looks at shedding properties and addresses Securities and Exchange Commission scrutiny over accounting practices.
"We are exploring strategic alternatives that include selling all or part of the company," said spokesman David P. Douglass said.
Ontario Mills opened in November 1996, when retailers still thought the Inland region had too few people to support more dining and shopping, said ChrisAnn Richards, the mall's first marketing director.
But the numbers told another story: 2.3 million people lived within a 20-mile radius compared with no more than 1 million at other Mills properties, she said.
"The joke in our industry has always been that it's the only grand opening that caused a SigAlert on Interstate 10," she said.
The company calls it the largest single-story mall west of the Mississippi.
"Just the scale was a draw for people," said Mary Jane Olhasso, the city's economic development director.
Although it continues to draw more people, shopper incomes fall below those of competing malls, even as incomes grow regionwide. The average income for an Ontario Mills shopper is $49,581, according to the mall, compared with average incomes of $69,109 at Victoria Gardens and $76,706 expected at The Promenade Shops at Dos Lagos.
"The Mills makes up in volume what it lacks in shopper quality," said Ralph Megna, a development consultant who has worked for various Inland cities. "You put enough people through that thing, and sure, you'll sell some merchandise."
Since opening, the Mills has turned over about half its retailers, landing outlet stores by higher-end names such as Polo Ralph Lauren, Kenneth Cole and Calvin Klein.
Irvine mall analyst Greg Stoffel walked through the mall on a recent weekday, pausing outside Nordstrom Rack, which was added in 2002.
"Anything Nordstrom does is good. That's the missing ingredient at Victoria Gardens, isn't it?" he said.
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| William Wilson Lewis III / The Press-Enterprise |
| The food court at Ontario Mills does plenty of business, as does the rest of the mall. Victoria Gardens attracts more well-heeled shoppers, but as development consultant Ralph Megna puts it, "The Mills makes up in volume what it lacks in shopper quality. You put enough people through that thing and, sure, you'll sell some merchandise." |
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But Mills' single-floor construction stretches the limit that shoppers want to walk. Also, the mall's circular pattern forces people to go around the whole circle unless they cut through the Virgin Megastore or a restroom hall in the middle of the mall.
Ontario Mills "was outdated five years ago," Stoffel said.
Crowds Still Come
Still, crowds jammed the corridors on a recent Saturday afternoon, standing in lines for ice cream, orange chicken and coffee.
Adrienne Baker, 23, had arrived at noon, and seven hours later, was trying on black pumps at Off Broadway Shoes. She had driven 2 ½ hours from Twentynine Palms.
"I'm ready to eat and go home," she said. "Since we do live far away, we try to get as much done as we can."
By 9 p.m., 75 people waited to buy tickets outside the AMC Theatres. An hour later, twentysomethings streamed in and out of Dave & Buster's, which covers 60,000 square feet -- bigger than a typical Vons market -- and features a restaurant, bar and pool tables, virtual golf and video games.
Kia Fennell, a Diamond Bar resident, was spending her third consecutive Saturday at Dave & Buster's, where a $5 cover charge takes effect at 10 p.m.
"It's a nice social, laid-back spot, especially when baseball and football are on," said Fennell, 23.
Though Dave & Buster's saw an 18-month dip in sales after Victoria Gardens opened, it has since rebounded, said general manager Michael Ewing. Ontario Mills is one of the top five performers among the company's 47 locations, he added.
But sales at the mall's Market Broiler are down this year compared with last year, which Rodney Couch attributes to the opening of Victoria Gardens. Couch, president of Preferred Hospitality, the parent company of Market Broiler, declined to give specific numbers.
He said the mall could use a remodel, with special attention paid to aesthetics.
"I think it's time for them to reinvent themselves," he said.
Ewing, like others, said he'd like more attention paid to maintenance, specifically mall landscaping and outdoor lighting.
"It could use some repainting, pizzazz and love," he said.
For months, Ontario officials say, they have complained to Mills Corp. that it's not properly maintaining one of the city's biggest sources of sales-tax income.
"So far, we haven't seen a lot of progress, and it's frankly kind of frustrating," said Otto Kroutil, the city's development director.
Paving did wrap up in September on one large city complaint: the mall's parking lot.
In 2004, the mall carpeted and painted each of its six main entrances, said Oxarart, the acting general manager.
As for painting the mall's exterior?
"That's something we'd like to do," she said. "I don't think that's something on the list for next year."
Two years ago, the investment firm JPMorgan Fleming bought half of Ontario Mills for about $243 million. Mills Corp. sold nearly one-quarter of its 65 percent stake and remains the managing partner.
Rather than invest its proceeds in the property, Mills Corp. used it to finish building a massive mall in Spain, said Olhasso, the Ontario economic development director. Douglass declined to discuss the JPMorgan transaction. Mills Corp. -- a real-estate investment trust -- has since entered negotiations to sell malls in Scotland and Canada and the Spanish mall for $981 million.
At a retailing conference in May, city officials offered to subsidize improvements with Ontario Redevelopment Agency money. Olhasso said it's too soon to know how much financial help the agency could give Mills Corp.
Protecting property values is important, she said, "because if they're not going up, they're going down."
Since Ontario Mills opened, 2 million square feet of retail has been built within two blocks of it, including a Costco, five hotels and more than a dozen restaurants, said Lee & Associates retail broker Carol Plowman.
Now, Ontario Mills finds itself in the position of having to catch up to the wave of retail growth it started, she said.
Instead of 8,415 places to park, some see land that could be put to better use.
Olhasso wants condominiums, the kind of dense housing being built within walking distance of Victoria Gardens and The Promenade Shops at Dos Lagos and proposed for several Inland downtowns.
"Right now, the property has a very distinct border. I'd like to open it up," she said.
Replacing parking with condominiums could be a good use for the land, but it would also mean building parking garages and figuring out where to put the housing, said Oxarart, the mall executive.
"I don't think it's out of the question, especially when you consider the growth in the Inland Empire," she said.
The mall will stay competitive for three to five more years but less so as it continues aging without a face-lift, consultant Larry Kosmont said.
"Ontario Mills got built as sort of a fast muscle car of retail that needs to be redefined as a better sedan," he said.
Nationwide, parking lots at large malls are being used for houses that connect to retail, Kosmont said.
"Ontario is ripe for it," he said.
Reach Devona Wells at 909-806-3052 or dwells@PE.com
Copyright The Press-Enterprise Co.
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