Continued: Macy's to close at Brookdale

Macy's, the nation's biggest department store chain, said Thursday that it will abandon the Brookdale Shopping Center, dealing another serious blow to a 42-year-old mall that struggled to retain tenants and attract shoppers even before the economy plunged into recession.

The loss of Macy's will push the vacancy rate at the Brooklyn Center mall to about 50 percent, the highest of any area regional mall. Area malls' average vacancy rate as of mid-2008 was 6.3 percent, according to NorthMarq, a Bloomington-based commercial real estate firm.

"It's like a house of cards," said Andrea Christenson, a vice president who specializes in retail for the Twin Cities office of Colliers Turley Martin Tucker. Malls draw their strength from their anchor tenants, she said, and Brookdale is running short of aces.

Brookdale has been unable to fill the space formerly occupied by Mervyn's, scuttling a project that would have replaced that anchor with a Wal-Mart Supercenter. Last fall, Brookdale lost another anchor, Steve & Barry's, which had opened a store in 2005 in the space of another departed anchor, J.C. Penney.

Sears will be the sole anchor left in the main structure of the mall, although Kohl's still has a store in the parking lot.

Macy's owns the 195,000-square-foot building it occupied at Brookdale and will try to lease or sell it, said spokeswoman Jennifer McNamara.

Christenson and other retail experts said that will be difficult in the current economy, when few chains are expanding and many, like Macy's, are cutting back. The Brookdale store is one of 11 stores nationwide that Macy's will close. No date has been determined for the Brookdale store's closing.

Even if the Macy's space is filled, it won't be enough to solve Brookdale's problems, Christenson said. Jim McComb, a Minneapolis retail consultant, agreed.

"It's not in good physical condition, and the layout is obsolete," McComb said of the mall. "A lot of it has to come down."

Most of the mall hasn't changed since it was built in the 1960s as one of the four Dales -- Brookdale, Southdale, Rosedale and Ridgedale. The Macy's store originally was a Dayton's, built as a second phase and completed in 1966. The Dayton's name changed to Marshall Field's in 2001 and changed again in 2006 after the parent company of Macy's bought Field's.

McComb said Brookdale faces additional challenges because of questions surrounding its ownership. The mall was taken over about three years ago by Brooks Mall Properties of Coral Gables, Fla., after previous owners, Talisman Companies, fell behind on property taxes.

Talisman began a renovation that added a food court and a Barnes & Noble bookstore. But other plans, such as adding a movie theater, never were realized. McComb said that hurt the mall's credibility with potential tenants, especially because some Talisman executives were also with Brooks Mall Properties.

Brooklyn Center city officials learned last year that Brooks Mall's lenders had assumed ownership of Brookdale. Representatives of the company and Bloomington-based Welsh Companies, the property manager, have declined to comment.

Brookdale's other problems include increased competition from a boom in retail development in nearby Maple Grove and demographic changes that have led to a decline in per-capita income in its trade area.

The problems have made Brookdale more vulnerable than other malls to store closings when a retail chain cuts back. For example, its Steve & Barry's store closed before the New York-based retailer announced plans to liquidate and shut all its stores, including outlets at Burnsville Center, Northtown Mall in Blaine and Knollwood Mall in St. Louis Park. The Brookdale Macy's is the only one of nine in the Twin Cities area scheduled to close.

McComb said Brooklyn Center has a large trade area, and Brookdale's prime location at Hwy. 100 and Interstate 694 is a plus. But he said the mall's tenant mix, as well as its physical structure, needs major overhaul. Christenson said new, better-capitalized owners should even consider some nonretail uses for the site.

Susan Feyder • 612-673-1723