Centennial OKs SouthGlenn redevelopment plan to add housing, replace Macy’s and Sears buildings

After nearly three years, one of the most prominent and contentious civic issues in Centennial has been decided with the city council’s approval of a plan to dramatically reshape Centennial’s flagship shopping center.

The council voted on Dec. 13 to green-light a redevelopment plan that would, among other changes, increase the number of allowed apartments by several hundred units at The Streets at SouthGlenn.

Property developers pushed the plan in an attempt to breathe more life into the outdoor mall and residential complex, but it met opposition for years from some area residents.

Mayor Stephanie Piko and the other councilmembers on Dec. 7 expressed general support for the redevelopment plan, but in the end, one councilmember objected to the proposal when the final vote was taken.

“I do agree that this will benefit Centennial as a whole,” Councilmember Christine Sweetland said during the Dec. 13 meeting, where she also noted her concerns about the plan’s impact on the residents she serves. She represents a part of west Centennial on the city council.

She added: “I don’t feel this (plan) will provide enough mitigation for the increased traffic in the area, so I will be voting no.” The final vote was 8-1.

MORE: New look at SouthGlenn traffic study

Area residents have largely voiced concerns about the potential for more traffic around the outdoor mall, located at East Arapahoe Road and South University Boulevard, a major intersection in the south metro area.

They also have objected to the possibility of new apartment buildings across the street from the less-densely-developed neighborhood nearby.

'Retail revolution'

Developers want to revitalize the outdoor mall, which has fought recent vacancies and is facing the expectation that its Macy’s store will soon close. The Macy’s lease expires in March 2022, according to Donald Provost, founding principal with Alberta Development Partners, which controls most of The Streets at SouthGlenn.

The Sears store at the opposite end of the SouthGlenn complex closed near the end of 2018.

“The reality is, these once-iconic brands continue to struggle and have to reinvent themselves” due to the “changing consumer behavior we’re all familiar with,” Provost said during a Dec. 6 council meeting about the redevelopment plan.

The city council has heard information about what a city staff report called the “retail revolution” — a series of consumer behavior and technological shifts, accelerated by the COVID-19 pandemic, that are “profoundly affecting the retail industry and every retail center,” a Dec. 6 city staff report said.

“Closed big box retailers, such as grocery stores and department stores, are often the most visible impact,” the report said.

Because the developers want to change the mix of types of properties allowed at SouthGlenn, their plans needed the city’s approval.

The Streets at SouthGlenn is one of the top sources of sales-tax revenue for the city compared to other shopping centers, but it hasn’t been performing as well as it used to. City officials and the developers’ team have pointed to SouthGlenn’s impact on tax revenue in Centennial.

The SouthGlenn site already includes apartments, but “additional residential units will help provide a critical mass of patrons to existing businesses within the neighborhood, creating a more stable tax base from which to derive public services,” an earlier city staff report said.

Piko, the mayor, underscored the fact that a bump in business at SouthGlenn would produce more sales-tax revenue but also that “we need to invest in our schools — we need to invest in our fire district.” Those entities pull funding at least partly from property-tax revenue.

“All of those things will benefit,” Piko said, referring to hopes for an increase in property values that the SouthGlenn redevelopment could cause, as opposed to a potential decrease that could occur if the mall continues down its current path.

Council cites public’s voice

Before voting to approve the plan, several city councilmembers pointed to the public’s influence on shaping some parts of what the redevelopment will look like.

“For the citizens, you can look at this project and see that your input made a difference,” Councilmember Mike Sutherland said during the Dec. 13 meeting. “Your input made a difference on the number of residential units that are planned for the entire development. Those numbers decreased dramatically from the first proposal we saw.”

In 2019 or late 2018, the developers’ original proposal was to build 1,600 additional residential units, such as apartments, according to city staff. Now, the plan envisions up to 911 new units to get to the proposed new limit of 1,125 units.

Sutherland felt the “thriving and vibrant” nature of the SouthGlenn area “needs to continue with good commercial development close by that’s not empty storefronts, that’s not decaying.”

“That’s going to cause much more trouble than (some) extra cars and a little more business,” Sutherland added.

The redevelopment plan has proved to be one of Centennial’s most visible civic issues in recent years. A crowd of more than 100 came to the empty former Sears at SouthGlenn at a March 2019 meeting that introduced the plans to area residents.

Roughly 400 people filled the seats at a November 2019 meeting at Powell Middle School in another community meeting about the plans, an unruly gathering that underscored the continued frustration some residents feel toward the project.

In all, Alberta and the other developer — Northwood Investors, which owns the former Sears property — say they held more than 35 meetings with area residents.

That included three large-group meetings, 14 or more individual meetings with residents, and 18 small-group meetings, according to the Dec. 6 city council meeting.

A public-comment forum that was hosted on the city’s “Have Your Say” webpage between July 23 and Aug. 13 saw 372 total comments, and a second public-comment forum between Oct. 28 and Nov. 28 saw 79 total comments, according to a city staff report.

The Centennial Council of Neighborhoods — also called CenCON, a coalition of homeowners’ associations and similar neighborhood groups — thanked the developers for some compromises.

“CenCON wants to thank and applaud both Northwood (Investors) and Alberta (Development) Partners for the opportunity to sit down (and) address all concerns — not only with CenCON but also with the Southglenn neighborhood group,” CenCON wrote in an Aug. 13 letter to the city. “During our discussions our ideas were seriously considered and the compromise that was reached is one that CenCON can fully support.”

CenCON listed “areas of compromise” in the plan including:

• A tiered “step-back” in building heights with lower heights at the perimeter.

(A stepback is a minimum distance that the upper floors of a building must be recessed, or stepped back, from the front of the building. It was referred to as a “a wedding-cake approach” by the developers’ team.) The step-back in height approach resulted in fewer units, according to CenCON’s letter.

• Cuts into the building along Easter Avenue “provide little courtyards and space for tenants.”

• A small park bordering Easter Avenue was included.

• Proposed landscaping along Easter Avenue and Race Street will “soften” the buildings as it matures, the letter says.

Affordable housing not part of plan

Some comments the public sent to the city at its at southglenn@centennialco.gov email address asked for the plan to include affordable housing units.

The developers’ Sept. 17 responses to comments, given through a company called Farnsworth Group, made clear that desires for affordable housing likely wouldn’t move forward.

“In most cases, the inclusion of affordable housing at a project like the Streets at SouthGlenn requires subsidies or other government involvement which the applicants are not contemplating at this point,” read the letter from Brad Nelson, an architectural manager.

Out of the existing housing at SouthGlenn, 12 of the 214 units are former retail storefronts that were converted to townhomes. The remaining 202 units are within the Portola at SouthGlenn apartment building.

Rental prices for the new housing in the redevelopment will be determined when the units “come online,” Provost said, and likely, they will be higher than the current rents in the Portola, he added.

A one-bedroom unit at the Portola currently costs a monthly rent starting at $1,824 to $2,424 depending on the type of unit, according to the Portola’s website.

For Alberta’s part of the planned redevelopment, the company is exploring both for-rent and for-sale housing, according to Provost.

“It remains to be seen whether we execute for-sale product,” Provost said during a Nov. 9 meeting of the city Planning and Zoning Commission. “But we are looking at it, and we’re exploring at-grade townhomes as well as stacked flats, stacked apartments, similar to Portola.”

Traffic concerns continue

Echoing concerns expressed by other area residents in recent years, Sue Carlton-Smith, who said she lives in the nearby Cherry Knolls neighborhood, voiced fears about added traffic during a December meeting.

“The traffic now is nuts going through Cherry Knolls,” Carlton-Smith said during the Dec. 6 council meeting. She added: “The least you could do is reduce the speed limit in our neighborhood to 20 miles per hour.”

At the end of a two-night meeting that saw comments from the public — and arguments by the developers in favor of the plan — the city council had been expected to vote on the plan Dec. 7, but it decided to postpone its vote after Piko, the mayor, suggested that city staff prepare a summary of the council’s “shared thoughts” on the matter to be presented to the public.

During the Dec. 7 part of the two-night meeting, city councilmembers generally supported the idea that the project meets the criteria on which the city must base its approval decision.

Carolynne White, land-use counsel with the developers, wanted to focus the discussion on comparing what was already allowed to be built at SouthGlenn as opposed to what developers had proposed. Without any rule changes, the developers could have built 2 million square feet of commercial or office space and up to a limit of 350 residential units, White has noted.

“If they were to build that out to the max entitled today, (it) would generate significantly more traffic than the proposal” the city was considering, White said during the November meeting this year.

She added: “It really cannot be disputed that the impact will be less with the (proposal) compared to what could be developed today.”

But during the early December proceedings in front of the city council, White acknowledged that it wouldn’t be practical for the developers to carry out a redevelopment of mostly commercial space rather than residential space.

“What I said was that it could legally happen, not that it will happen,” White said. She added: “I think it’s fair to say, as Don (Provost) just alluded to, that if the market wanted to backfill these boxes (Sears and Macy’s), with these two developers working diligently as they have over the last several years to do so, it would have happened by now, and we wouldn’t be asking (the city) for these approvals.

“Do I think that there’s a high likelihood that we would be able to get anywhere close to 2 million square feet or even just backfill those two boxes, absent this change? No, or else we wouldn’t be here,” White said.

In the December city council meetings on SouthGlenn, one other area of compromise that saw much attention was the northbound left turn from South University Boulevard to Commons Avenue into SouthGlenn, providing direct access to Whole Foods Market and other businesses facing University.

In response to concerns about congestion at that intersection in particular, the development team was willing to “commit voluntarily” to help implement whichever solution the city sees fit, according to White.

Sutherland, a councilmember, during the Dec. 7 meeting said: “I deeply appreciate the additional consideration of the (developers) in working with the city staff to work on the traffic problem on University at Commons Avenue, the northbound left turn lane, expanding that to possibly two left turn lanes from northbound University to westbound Commons.”

Even still, some traffic concerns were not addressed in detail during the meetings.

Jane Mataich, a resident who lives in the area, argued during the Dec. 6 meeting that a study of how traffic would look after the redevelopment was incorrect. She argued that traffic related to the former Sears land was improperly processed.

Anna Bunce, the City of Centennial’s traffic engineer, said in a Dec. 13 statement to the Centennial Citizen that she does “not have any outstanding concerns” regarding the traffic study.

For more details about the traffic issues, see the Citizen's new look at the traffic study and see the "traffic numbers" section of our previous story.

See a look at storm drainage issues in the SouthGlenn area here in a sidebar.

Changes over decades

This wouldn’t be the first time big changes have come to SouthGlenn. The Streets at SouthGlenn was originally the large, indoor Southglenn Mall built in the 1970s, and the Sears and Macy’s were components of that mall. Southglenn Mall closed in 2005, according to city staff. SouthGlenn’s outdoor shopping center layout replaced the former mall in 2009.

The recently closed Sears building was built in 1974, according to Arapahoe County assessor’s records. The current Macy’s building was constructed in 1981, county records say.

In November this year, the group of citizens who evaluate development proposals in Centennial unanimously recommended that the city council approve the plan to reshape SouthGlenn. Seven members of the Centennial Planning and Zoning Commission voted on Nov. 10 in favor of green-lighting the redevelopment plan.