Vallco Shopping Mall

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Vallco Shopping Mall
Cupertinosquare1.jpg
Interior view of Vallco Shopping Mall, then called Cupertino Square
Location Cupertino, California, United States
Coordinates 37°19′35″N 122°00′52″W / 37.3263°N 122.0144°W / 37.3263; -122.0144Coordinates: 37°19′35″N 122°00′52″W / 37.3263°N 122.0144°W / 37.3263; -122.0144
Address 10123 North Wolfe Road, Cupertino, California 95014
Opening date September 1, 1976
Developer Vallco Fashion Park Venture (Phillip Lyon, Gordon & Co. and Vallco Park Ltd.)
Owner Sand Hill Property Co.
No. of stores and services

140 (1976)

190 (1988)
No. of anchor tenants 3
Total retail floor area 1,200,000 sq ft (110,000 m2)
Macy's 179,962 sq ft (16,719.0 m2)
Sears 257,548 sq ft (23,927.0 m2)
J. C. Penney 548,856 sq ft (50,990.4 m2)
No. of floors 3
Website vallcoshoppingmall.com

Vallco Shopping Mall (formerly called Cupertino Square and Vallco Fashion Park) is a three-level dead mall located in Cupertino, California, United States. It was formerly anchored by Macy's, Sears, and J.C. Penney. As of June 2016, the mall is almost 95% vacant – with AMC Theatres, Cupertino Ice Center, Bowlmor Lanes, Tatami Sushi & Seafood Buffet, Cold Stone Creamery, Dynasty Seafood Restaurant, Benihana, SportAction, Golden Vision Optometry, and Dr. Fred Slater, Optometrist as the only remaining tenants.

A plan to rebuild Vallco as a mixed-use development with retail, housing, and office space appears to be indefinitely suspended after Cupertino voters failed to approve Measure D on the November 2016 ballot, which would have immediately green-lighted the project.[1] Despite obtaining community input in the planning phase,[2] the project ran into significant push-back from citizens who wanted to freeze the site as retail-only, citing concerns about traffic and schools should more people be allowed to come into the city through proposed offices and residential units at the site .[3]

Major stores and activities[edit]

The anchors and major businesses in Vallco are:

Winter morning at the farmers' market

Vallco also hosts Pacific Coast Farmers' Market in the parking lot behind J. C. Penney.

History[edit]

Vallco Park started as a business park in the 1960s, formed from land owned by 25 Cupertino property owners. It was named for the primary developers: Varian Associates, and the Leonard, Lester, Craft, and Orlando families.[4] Vallco Business Park is now the home of the Cupertino campus of Hewlett-Packard and a campus for Apple.[citation needed]

Origins and expansion[edit]

In the early 1970s, the Cupertino City Council held public hearings on the possible locations of a regional shopping center in the city. After it decided the city could only support one center, the Vallco group found itself competing with another group led by orchard owner Paul Mariani, Jr. In 1973, the city council decided it wanted the regional shopping center on the edge of the city and gave the proper zoning to Vallco.[4]

Vallco Fashion Park opened in September 1976. In its first years, the mall's main walkway was punctuated by several parks showcasing aspects of local history, ranging from apricots to Klystron tubes.[5] Vallco was one of the largest shopping centers in Silicon Valley and soon drew customers from all over the region.

One of the early features of the mall was the ice skating rink attached to the shopping center. The Ice Capades Chalet, open for almost ten years, began to encounter trouble in 1986, when proposals to close it and replace it with movie theatres emerged. By June 3, 1988, the rink faced imminent closure, until the Cupertino city council stepped in and kept the rink open when faced with vocal protest. At the time, the ice rink was one of two year-round skating rinks nearby – the other being the identical Ice Capades Chalet at San Mateo Fashion Island (the latter would ultimately close in 2013, despite prominent vocal protest, after a new developer stepped in with plans to transform the ice rink into an office/retail space).

It was also the first place that sold San Jose Sharks merchandise, before the SAP Center, formerly known as the San Jose Arena and HP Pavilion, was built.

Increased competition from other regional malls, such as Stanford Shopping Center, and in particular Valley Fair (opened 1986) began to cause Vallco trouble. In July 1988, an $20 million expansion for the mall was announced, which would add a lower level and 50 stores, increasing the total store count from 140 to 190.[6] Ultimately, this expansion was completed in August, 1988, adding a total of 60 stores.[7]

Another large tenant arrived at the mall on the weekend of August 11, 1990, with the addition of the Tilt Family Entertainment Center.[8]

Deterioration and renovation[edit]

Occupancy began deteriorating in the 1990s, and the emptying of the mall continued into the mid 2000s. One reason for this decline was that the selection of mid-range stores didn't reflect the affluence of the surrounding populace.

Early 2000's[edit]

Alan Wong, Emily Chen, and John Nguyen bought Vallco and began renovation of the mostly empty mall in 2005. By 2006, Vallco had the lowest occupancy rate of any mall in the area, at just 24 percent. One of the changes made to Vallco as part of these new renovations was to completely close the first of the mall's two levels in 2005, leaving the focus on the second floor. From there, new tenants were pulled in over the next few years.

In 2006, Cupertino voters prevented re-zoning of part of the Vallco property for condominiums by overturning a re-zoning ordinance that was passed by the city council. The loss of the revenue that was expected from this sale contributed to the financial problems of the owners. The contractor for the movie theater, DPR, filed a mechanic's lien against the owners for approximately US$10 million in July 2007, which was settled the following September when Orbit Resources acquired the mall.

Vallco Fashion Park's name was changed to Cupertino Square in 2007.[9] Later that year, the owners sold three parcels of land to Evershine Property Management and sold a controlling stake of the mall to Orbit Resources,[10] which switched managing agents from Landmark Property Management to Jones Lang LaSalle.[11]

On May 4, 2007, a new 16-screen AMC movie theater opened in the center of the mall, coinciding with the theatrical release of Spider-Man 3. The grand opening of this highly-anticipated film and the theater was heavily marketed towards the students of the nearby Cupertino High School.

Renovation of the mall that began in 2005 continued. By 2009, two new parking structures, the movie theater, a food court, and Strike Bowling (at the former location of Tilt Family Entertainment Center) had been added to the complex. Future plans included shops facing the street at the corner of Wolfe Road and Vallco Parkway and a seismic upgrade of the parking garage west of the theaters as well as the main mall structure, two new hotels and a Hofbrau Beer Hall adjacent the theaters. The bankruptcy filing in 2008 derailed all the future plans (hotel retail and the beer hall).

In September 2008, the two owners of the complex filed for bankruptcy to prevent the primary financier, Gramercy Capital, from foreclosing on their property. According to Gramercy, the assets of the company fell well below the debt owed, though the consortium disputed this.[12]

In September 2009, Vietnamese food processing company Son Son Co. purchased Cupertino Square for US$64 million in an all-cash transaction. The new owners restored the name Vallco Shopping Mall.[13]

Current Ownership[edit]

In October 2014, Sand Hill Property Co. purchased Macy's, J. C. Penney, and Sears at approximately US$200 million.[14] In November 2014, Sand Hill Property Co. completed purchase of the entire mall for a total of US$320 million, the first time the entire mall including the anchor stores had been under the same ownership.[15][16][17]

In January 2015, J. C. Penney and Macy's announced plans to close their Vallco locations[18][19] Sears also announced that its store would close in October 2015.[17] The remaining mall tenants have been notified their leases are up to prepare for the mall's shutdown in 2016. Some of the stores will be relocated into Sand Hill's nearby development, Main Street Cupertino.

In August 2015, Sand Hill announced a plan to demolish the mall structures and make it into The Hills at Vallco, a retail, office, and residential development based on a street grid. It was to be covered with the world's largest green roof, which is to be occupied by a city park. Rafael Viñoly Architects and OLIN Landscape Architects have been selected as chief designers of the project.[17]

In November 2016, voters rejected two ballot initiatives related to Vallco [20] - Measure C, which would have attempted to freeze Vallco as a retail center without offices or housing, in addition to imposing additional restrictions on development options throughout the city, and Measure D, which would have approved the proposed Hills at Vallco project, bypassing standard city approval processes [21] .[22] In the wake of the decision, Sand Hill appears not to be interested in moving forward with approval for modified plans, and will allow the mall and land to lie vacant. Sand Hill Managing Director Reed Moulds said the company "will not sell the land nor make investments into the current failed asset. In order for us to invest in Vallco we have to be certain it will be a worthwhile investment and not just the Band-Aid approaches that have failed Vallco for decades. Until Cupertino is ready for that approach, we have no choice but to stop".[1]

References[edit]

  1. ^ a b "Cupertino voters reject dueling Vallco initiatives, final closure of mall planned", Silicon Valley Business Journal, 2016-11-09 
  2. ^ "Largest green roof in the world proposed for new Vallco Mall project in Cupertino", The Mercury News, 2015-08-26 
  3. ^ "Cupertino building initiatives spark zoning feuds", first tuesday Journal, 2016-05-31 
  4. ^ a b Fuller, David W. "Vallco Park: From Orchards to Industry". In Sharman Schultz, Linda. Cupertino Chronicle (2002 Edition). Cupthistory.org (2002 ed.). Cupertino Historical Society. pp. 155–165. 
  5. ^ "Cupertino.org: History", Cupertino.org 
  6. ^ "Paving the Way: Vallco Plans $20 Million Expansion", San Jose Mercury News, 1987-07-02 
  7. ^ "Vallco Strikes Back: Cupertino Mall Opens Big Addition", San Jose Mercury News, 1988-08-26 
  8. ^ "For the Vid in All of Us: Video Games, Bumper Cars, Pinball — The Tilt Arcade is Something Like a Kid's Idea of Heaven", San Jose Mercury News, 1990-08-14 
  9. ^ Kraatz, Cody (2007-02-14), "Vallco gets new name to go with its new look, shop", Cupertino Courier 
  10. ^ Lu, Crystal (2007-10-03), "Cupertino Square and 3 parcels are bought by local investors", Cupertino Courier 
  11. ^ Jones Lang LaSalle press release, Jones Lang LaSalle Named Leasing and Managing Agent for Cupertino Square, (2007-10-09)
  12. ^ Simonson, Sharon (2008-09-04). "Cupertino Square owners file for bankruptcy". San Jose Business Journal. San Jose News. Retrieved 2008-09-21. 
  13. ^ Conrad, Katherine (2009-10-16). "Cupertino Square deal brings new owners, returns to old name". San Jose Business Journal. Retrieved 2009-10-19. 
  14. ^ "Developer buys anchor stores at Cupertino's Vallco mall; J.C. Penney and Sears to close", Silicon Valley Business Journal, 2014-10-28 
  15. ^ "EXCLUSIVE: Sand Hill Property Completes Purchase of Entire Vallco Mall for Total of $320MM", The Registry, 2014-11-12 
  16. ^ "Vallco finally under single ownership — Pau's Sand Hill lands last piece of mall puzzle", Silicon Valley Business Journal, 2014-11-12 
  17. ^ a b c Wilson, Matt (2015-08-26). "Cupertino: Largest green roof in the world proposed for new Vallco Mall project in Cupertino". San Jose Mercury News. 
  18. ^ Strauss, Gary (2015-01-08). "J.C. Penney, Macy's to shut stores, lay off scores". USA Today. 
  19. ^ Macy's, Inc. (2015-01-08). "Press release: Macy's, Inc. Evolves with Changing Customer Landscape, Invests for Continued Sales Growth". 
  20. ^ "Cupertino Election Results". Cupertino.org. Retrieved 10 November 2016. 
  21. ^ "Cupertino Measures C and D". Cupertino City Clerk. Retrieved 10 November 2016. 
  22. ^ "Vallco project officially on the November Election Ballot", San Jose Mercury News, 2016-07-15 
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