BUSINESS

Beverly Center to undergo $500-million renovation that will add upscale food and sunlight

The Beverly Center, a grand dame in Los Angeles retailing, is placing a $500-million bet on food and sunshine.

A sweeping renovation of the eight-story mall begins late this month and will feature skylights and a new, window-dotted exterior to open and freshen the 1980s shopping fortress.

But the biggest addition to the luxury-brand center will be a fancy food hall and upscale restaurants as developer Taubman Centers, like mall owners across the country, tries to lure increasingly fickle consumers.

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Airy outdoor malls such as the Grove and the Americana at Brand, as well as retail stretches such as the Third Street Promenade, are attracting customers who want to browse while enjoying Southern California's balmy weather. Young tech-savvy shoppers are choosing to buy online instead of at bricks-and-mortar stores.

Malls trying to keep up with the times are turning to food as a way to draw people, analysts said. The Beverly Center, as part of its revamp, will introduce nine new restaurants and a food hall to be helmed by celebrity chef Michael Mina.

"The food is the most dramatic," said William Taubman, chief operating officer of Taubman Centers. "We have been by far the weakest in food historically, and we will now become the strongest."

The food hall, to be called the Street despite its location on the top-floor terrace, will offer 15 to 18 concepts from different chefs, Mina said. Possible options, he said, include a ramen bar, a poke bar and an eatery with barbecued meats from around the world.

Mina, who will also have a restaurant on the Beverly Center's ground floor, said that Americans have greater expectations when dining out.

"People are more educated than they have ever been about food," said Mina, who is also working with Taubman to bring food-hall style dining to a Hawaii shopping center. "They are demanding higher quality than they have ever demanded, especially people shopping in places like the Beverly Center."

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Other Southland shopping centers are also recognizing the need to offer food beyond hot dogs and pizza.

Westfield Century City is in the midst of a massive $800-million makeover, including adding the first California branch of the gourmet Italian food emporium Eataly, which is co-owned by Crocs-loving chef Mario Batali. It is one of several Westfield malls that have upgraded their food courts into so-called food terraces in recent years.

After a serious overhaul, the once enclosed Santa Monica Place relaunched in 2010 as an open-air space — with a dining deck offering gourmet fare and views of the Pacific Ocean and the Santa Monica Mountains.

Taubman said that food has become "an important draw" for malls.

"It has the potential to become an anchor in a project like this," he said. "I think everybody who comes to dine will shop."

It's become imperative for shopping centers to upgrade as they face an onslaught of competition from e-commerce, analysts said.

Traditional anchors such as department stores are no longer the draws they once were, especially among young shoppers. Many shopping centers face extinction if they don't evolve.

"We are seeing this massive decline in mall traffic," said Joe Schmitt, a director in the retail practice at AlixPartners. "Traditional prison-block-style malls have been negatively affected by traffic and rent."

Some retail destinations have gotten creative, adding bowling alleys and mini-golf courses. Even malls in colder climates such as Chicago are being reborn as open-air centers, making the gamble that shoppers will still enjoy the fresh air when temperatures dip.

Malls are splitting into two classes, analysts said. High-end ones that have upgraded to offering fine dining and other amenities are thriving and enjoying higher traffic and sales, while a glut of lower-tier shopping centers are in danger of going out of business.

"You have ghost malls that have shut down," said Jeff Toohig, a director and senior analyst at ITG Investment Research. "In terms of high-end malls, those are the locations where it makes sense to put capital in." Beverly Center, which has long been a destination for luxury labels, is doing just that.

Taubman, whose father helped build the Beverly Center, said the company did nearly a year of research to pinpoint what needed to change at the mall. They convened focus groups, conducted shop-alongs and even stayed with customers, peering into their home closets.

"It's a little bit like a psychiatrist," he said. "They felt the overall environment was feeling dated. But they didn't tell us specifically, 'I want a big skylight.'"

On Yelp, where the Beverly Center gets three out of five stars, reviewers praise the mall's ritzy brands, including Prada and Louis Vuitton, but complain about skimpy food choices.

Some disgruntled visitors call the mall — which opened in 1982 and has undergone smaller renovations — "dated" and "not really that cool."

Italian architect Massimiliano Fuksas, who is in charge of the renovation, said he wanted to bring more of the city into the center.

"It wasn't the best building I have seen in my life," Fuksas said. "It was so concrete and very hard."

To bring in more light, the remodel will include a ribbon of skylights. A perforated steel facade will curve along much of the outside.

The parking structure is getting an upgrade, with smart technology to help motorists find a spot and, later, remember where they parked.

Big windows will bring views of Los Angeles, while an outdoor dining area extending out of the food hall will give diners the option to eat in the open air.

The first floor will have as many as eight restaurants, with tables outside. There will also be added greenery on the street level to attract passersby.

"There is no barrier between inside and outside," Fuksas said. "Your building has to be part of the city."

Mayor Eric Garcetti said the Beverly Center has long held "a special place" in Los Angeles.

"It's where an entire generation of Angelenos went on first dates, bought prom dresses and met up with friends on weekends," Garcetti said in a statement. The remodel is a "tremendous investment," he added, that will allow future generations to have those same experiences at the shopping center.

The mall will stay open throughout the remodel, which should be completed by November 2018.

Although the Beverly Center has enjoyed sales increases, even in recent years, the remodel will ensure that it remains a shopping destination in the future, Taubman said.

"Malls really represent culture and society and economics at a given time," he said. "You have to step back and ask, 'Is it as relevant today as it once was?'"

shan.li@latimes.com

Twitter: @ByShanLi

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Copyright © 2016, Los Angeles Times
A version of this article appeared in print on March 06, 2016, in the Business section of the Los Angeles Times with the headline "Hitting reset on luxury mall - The Beverly Center will be getting a $500-million revamp" — Today's paperToday's paper | Subscribe
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