City Place Mall predated the revival of Silver Spring when it opened in 1992, but was then surpassed by it. Can the mall work as Ellsworth Place? (James M Thresher/TWP)

You don’t have to look far to find a developer that’s decided it’s time to give up on the mall business.

Owners of  a string of local malls decided it’s time to go in another direction in recent years as big box stores and online shopping ate away at their base of shoppers. Landover Mall and White Flint Mall, in Maryland, have been demolished. In Alexandria, Landmark Mall’s roof is coming off.

Not two weeks ago Arlington officials put up $55 million to overhaul Ballston Common Mall because mixed-use developments were “just throttling” it.

But in Silver Spring, developers are going against the tide by betting — again — that they can save the mall. This week, they are formally unveiling their latest iteration, complete with tens of millions of dollars of upgrades and a new name: Ellsworth Place.

City Place Mall was a trailblazer when developer Walt Petrie and his partners opened it at the corner of Colesville Road and Fenton Street it in 1992. Petrie delivered a 10-screen movie theater, food court and shops including Nordstrom’s Rack, more than a decade before downtown Silver Spring would truly experience its revival.

 


In 1996, three years after opening, the owners of City Place Mall offered free food, drinks and bus rides to seniors willing to come shop. (James M. Thresher/TWP)

Back then, downtown Silver Spring was relatively lifeless and battered by high vacancies. The Silver Theatre were empty. A little-known cable network, the Discovery Channel, had yet to grow into today’s Discovery Communications and it was still based in Bethesda.

The Hecht Co. had left its historic building on Ellsworth five years prior, with one of the company’s executives telling The Washington Post: “We don’t find that the better customer is shopping in Silver Spring. She seems to have migrated further out in the suburbs.”

The developers incorporated the former Hecht’s building into a new $60 million, 350,000-square-foot mall with art deco design, a retro clock, angular sconces, chandeliers and a marble entryway.

“Walt Petrie deserves a lot of credit for building that in the first place,” said Montgomery County Council member Nancy Floreen (D-At-Large). He broke ground “when no one would invest in Silver Spring.”

To support the project, Montgomery County put up $17 million toward a 1,280-space parking garage next door. More than 30 stores were ready for business at the grand opening, within walking distance of a Red Line Metro station.

“It really was ahead of its time when it opened in 1992,” said Petrie’s partner, Terry Richardson, president and chief operating officer of the partnership, Petrie Richardson Ventures.

Thereafter Silver Spring began a resurgence with the opening of a revamped downtown area, the Silver Theatre and later the Fillmore music hall. City Place, however, began to slide along with other smaller enclosed malls nationally.

An effort to attract more upscale tenants to the mall didn’t pan out. Crime became a concern at City Place, as did management’s response to it. As Montgomery County blogger Dan Reed wrote recently: “Standing inside City Place Mall, it’s as if the revitalization of downtown Silver Spring never happened.”

“The immediate marketplace had changed and for the suburban communities around downtown, they can shop in their car and go to Wheaton,” Floreen said. “So that was always the challenge that they were facing.”

By 2008 Petrie and his partners owed more to a bank than the center was worth.

But rather than try another kind of development, the developers embarked on an effort — now eight years old — to save their mall. Petrie, Richardson and their partners brought in a new backer, Hutensky Capital Partners of Hartford, Conn., which helped negotiate a loan buyout and reacquire the mall for $22.8 million.

The upgrades, though, were slow to follow until a new partner, Rockwood Capital, joined to again reacquire the mall, this time for $28 million.


Construction workers install new signage outside the newly renamed Ellsworth Place. (Jonathan O’Connell/TWP)

They settled on a plan that best resembles what the new owners of the Shops at Georgetown Park, the brick mall in Georgetown, did with their property: Clear out a large swath of tenants and bring in bigger box stores aimed at value-conscious customers.

They also set aside a carrot for the future by ensuring the rights to build a nine-story, 210,000-square-foot office tower on top of the mall down the road.

To get retailers to sign on, Petrie and Richardson planned tens of millions of dollars in upgrades. Down came the fountain and canopy at the corner of Fenton and Ellsworth in favor for outdoor seating for a casual restaurant, Not Your Average Joe’s. Up went jumbo-trons and bright signage for anchor stores. New entrances were added, connecting to 10 new interior escalators.


Inside Ellsworth Place, the developers are going for an industrial look. (Jonathan O’Connell/TWP)

Inside the developers tore out the food court, the former Gold’s Gym space and the movie theater and began cladding the mall in wood, metal and concrete in pursuit of an industrial look. To common areas they added seating, wireless internet and a children’s play place.

So far the plans have received a warm reception from discount retailers. Burlington Coat Factory is expanding and upgrading its store. T.J. Maxx opened earlier this month and Foot Locker, Michaels craft store and F21 Red — a discount version of Forever 21 — are on the way.

Dave & Busters, the sports bar and arcade, will open in the 40,000-square-foot former movie theater space next fall after having to close recently in White Flint.

With Silver Spring bustling on all sides, there is optimism that Ellsworth Place will get it right when City Place Mall could not.

“The customer base that is there will definitely shop it and it’s hard for those retailers to find alternative locations in that market where they can afford it,” said retail broker David Dochter, co-founder of Dochter & Alexander Retail Advisors.

Dochter said an H&M store across the street, which he represents, is doing very well and that there was an appetite in Silver Spring for affordable goods.

“The challenge was always that it was not a larger regional mall,” he said. “But I think it will work.”

Follow Jonathan O’Connell on Twitter: @oconnellpostbiz