The owners of the Streets at Southpoint are cooking up something new for the mall in southern Durham.
Brookfield Properties, the real estate investment trust that owns the mall, is submitting a rezoning request to the city of Durham that would allow it to move beyond only offering shopping on its 90-acre property.
At a neighborhood meeting on Thursday, Brookfield revealed that it would be requesting a new zoning designation to allow up to 200,000 square feet of office space, 100,000 square feet of new retail space, a hotel and up to 750 apartments.
In a statement to The News & Observer and The Herald-Sun, Brookfield said it was in the process of exploring future plans for the large mall.
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“In our efforts to continue the renowned success of the Streets at Southpoint, we are exploring future plans for our shopping center,” Lindsay Kahn, a spokeswoman for Brookfield Properties, said in an email. “As this is the beginning of a community process, we look forward to an engaging dialogue to ensure a dynamic future for Streets at Southpoint.”
On Thursday, Charlie Tapia, senior director of development retail for Brookfield, expanded upon what that future could look like.
The company is still deciding how to proceed on the property, so it isn’t clear yet whether the new development will occur in the property’s large parking lots or if it will require redeveloping existing buildings.
Tapia said it could possibly be both — though concrete plans won’t be released until after the city votes on the rezoning application. The goal is to have the city council vote on the rezoning in the next six to eight months, said Patrick Byker, a lawyer with the Morningstar Law Group that is representing Brookfield. Already, the mall is in the process of doing a traffic impact analysis for the rezoning.
Brookfield only recently took over the mall, which attracts shoppers from all over the region and other parts of the state. Last year, Brookfield acquired mall operator GGP, which owned the mall, for $15 billion.
In December, Sears announced that it would be closing its large department store and auto center, located in the parking lot of the mall. Tapia said plans for the rezoning began before Brookfield knew that Sears would be closing.
“We all read the news and understand that malls are evolving and changing,” he said. “We are in a position of strength right now (with Southpoint), but we need to maintain that. So we need this flexibility so that at some point in the future ... (we can) have other uses and this is happening at all of our malls.”
This is about having the flexibility to offer what the community demands over the next 10 years, Tapia added.
Tapia noted that at a mall that Brookfield owns in Atlanta, they recently turned some old stores into a space for the co-working company WeWork. But, if Brookfield wanted to turn the Sears property at Southpoint into a co-working space right now, it would be barred under zoning, he said.
It was also noted that any new retail that is created would likely have apartments built over top of it, to give the mall a more urban feel.
At the meeting, Brookfield, which owns hundreds of malls across the country, said that currently Southpoint is one of its strongest-performing malls. But that doesn’t make it immune to the issues facing traditional malls.
Many malls in the Triangle have faced struggles in recent years and have come under new ownership, such as Northgate Mall, which was on the brink of foreclosure, and University Place in Chapel Hill. The Cary Towne Center mall also has struggled as major retailers have pulled out, including Macy’s, Sears and now JCPenney.
“It’s good to be ahead of the curve so that you don’t have another Cary Towne Center experience or a Northgate Mall experience,” Byker said. “You’ve got to be ahead of the market and figure out where it’s going.”