Plaza Del Sol: Eastside Mall Seeks Sunshine
Plaza Del Sol does not aspire to the retailing ranks of the mammoth South Coast Plaza or the flashy Beverly Center.
But the pleasant-looking little mall in the primarily Latino Eastside community of Boyle Heights, close to a landmark Sears store that fairly bursts with shoppers, has a problem that could doom any mall: a lack of customers.
The mall’s owner-developers contend that Plaza Del Sol, whose first shops opened 15 months ago, is undergoing a normal break-in period and is beginning to turn around. Some bitter tenants and former tenants charge that the developers promised a first-class mall but delivered something less. Lawsuits have been filed by both sides.
Besides the desire to build a profitable mall, Plaza Del Sol’s developers say they wanted to invest money in a needy community. But some community leaders fear that problems at Plaza Del Sol--no matter who is to blame--could cause an unwarranted souring on investment in the Eastside.
“This place is a pit,” said Juan Jimenez, who plans to move his photo studio-tuxedo rental-invitation shop out of Plaza Del Sol in the next several weeks because of slow business. “The doors open and the flies--they don’t even come in,” he said.
“Boy, I’ve really taken my lumps on this one,” said Steaven K. Jones, one of the mall’s developers and owners. “We put $10 million of our own cold, hard cash in a community that desperately needs it . . . (and) all we’ve gotten is to get our little seats kicked in,” he said.
Plaza Del Sol appeared on the scene with much fanfare and hoopla. The March, 1985, ground breaking drew the likes of Mayor Tom Bradley, then-Assemblyman Richard Alatorre, Los Angeles school board member Larry Gonzalez and then-City Councilman Art Snyder.
Now the fanfare is long gone, and the shoppers are few. Several empty store fronts dot the mall.
A sampling of shoppers interviewed recently found high marks for Plaza Del Sol’s looks but complaints that there are not enough shops open to patronize.
“Some people don’t really know about this. . . . I give it a couple of months,” said Yvette Borbon, who works across the street at McDonald’s and shops frequently at the mall. “It’s nice. . . . the prices are good.”
Plaza Del Sol’s chances of success had seemed good despite the relatively low median income of area residents. A marketing study commissioned by the developers noted that more than 50,000 cars passed the mall’s location every day.
Only a block away, the Sears store at the junction of Olympic Boulevard and Soto Street does a booming business. The tall beige tower with the red neon sign has been a beacon to local shoppers since 1927. For many Latino families, the trek to the Olympic and Soto Sears is a weekly ritual.
Includes Respected Builder
What’s more, the developers included Roy L. McNeill, a respected builder who was co-developer of the Sherman Oaks Galleria and the nearby 21-story American Savings Plaza, considered to be one of the most successful speculative office buildings in Southern California.
Early press releases billed Plaza Del Sol, which was to fill the long-empty Arrow Chevrolet dealership on Soto, as “the biggest and best shopping area in the Boyle Heights section of Los Angeles.”
Plaza Del Sol would feature Mexican-style architecture, dining courts, skylights and escalators, one press release stated. The 80,000-square-foot mall would have an ambiance “somewhere between the Ports O’ Call Village (in San Pedro) and Olvera Street. It will be a tourist attraction as well as a place to shop.”
The Plaza Del Sol that emerged is swathed in a pink and aqua interior with brown and beige tile floors--colors more reminiscent of “Miami Vice” than Mexico. It sports a small central fountain and scattered plants.
A lawsuit filed by one unhappy former tenant stated that the developers and others “hailed Plaza Del Sol as resembling nothing less than an oasis in the midst of the stark reality of the inner city.” But the plan for Plaza Del Sol--the escalators, skylights, “lush tropical planting” and an area devoted to local artisans--did not materialize, said the suit, which was filed last July by Robert Alvarez, an optometrist who maintained an office in the mall for eight months.
Crowded as a Ghost Town
“The public has stayed away in droves, and Plaza Del Sol is generally about as crowded as a ghost town,” Alvarez’s suit said. The developers have since sued Alvarez and some other former tenants for back rent and other expenses.
At least three other former tenants have filed countersuits similar to Alvarez’s, alleging breach of contract and fraud, among other things. At least one former tenant said he is close to settling his suit. Another group of current and former tenants has hired a lawyer and plans to sue the developers. Some former tenants place their losses at tens of thousands of dollars each.
“A lot of shopping centers have a tough time at the beginning,” said Philip A. Kramer, a lawyer representing the developers. “The tenants who come in and don’t make a go of it think there’s something wrong with the shopping center.”
The complaints, primarily by former tenants who left empty shops that have yet to be filled, include promises of big tenants that they say never appeared, a shortage of advertising and promotion, duplication of store types within the mall, a poorly marked parking lot, cutbacks in security, a multiplicity of advertised grand openings when only a few stores were ready and the failure to draw a restaurant for several months. Restaurants or other forms of entertainment are a key ingredient in bringing people to the mall, the developers’ marketing study concluded.
The varied complaints boil down to the mall’s inability to draw shoppers.
“It’s very slow here,” said Youngman Le, who owns a small appliance store called Lee’s Radio that opened Dec. 15. The Christmas season “was so-so, but now it’s very bad.” The entrepreneur said that if business doesn’t pick up, he probably will move at the end of his six-month lease.
Lost a Lot of Money
“I lost of lot of money in that place,” said Martha Aguilar, who operated Today’s Look hair salon until last April. “You see people come in and look around and they’re disappointed,” said Aguilar, who owns two other beauty parlors.
Richard Alatorre, who is now a Los Angeles city councilman representing the 14th District, which includes Boyle Heights, said he thinks the mall’s owners didn’t market Plaza Del Sol correctly. “I don’t think they have done everything they could to make it attractive for people to shop,” he said.
One example of the differing views of what will work on the Eastside: The owners have rented part of the second floor to the Immigration and Naturalization Service for a processing center, which will open in May.
Jones said the INS predicts that the office will bring 200 to 500 people to the mall every day, and the developers think it is an important step toward improving business at the mall. But Alatorre said he is against locating the office in Plaza Del Sol because the presence of INS officials may frighten away customers. “I just think that’s the wrong move to make,” Alatorre said.
Stella Bustos, a former public relations director and manager of Plaza Del Sol, said she believes that the owners “didn’t really plan to make a full investment in promoting it.”
“You have these Anglo developers feeling their Anglo decisions are great for the Westside, but they just don’t hold water on the Eastside,” she said.
Bustos said the owners skimped by cutting back on advertising, failing to install a kitchen in the banquet room and avoiding placing a drinking fountain in the mall. “I am somewhat angry at the mentality of these Anglo men who come in and think Mexicans don’t get thirsty,” she said.
McNeill called Plaza Del Sol a “well-built building,” constructed by one of the same companies that built Sherman Oaks Galleria. “This is the finest improvement to be put in Boyle Heights for a long time,” he said.
Tenant Likes Mall
Not everyone is unhappy. Eugenia Beral, co-owner of Expressions Hair Designs, said business is “very, very, very good. This is a very good mall.”
“I don’t know anything about other tenants,” Beral said. “I care about this business only, and it is very good.”
At Azteca Jewelers, next door on the first floor of the mall, “business is OK. It could be better,” said Juan Perez, owner of the seven-store chain.
Perez noted that sales were very slow in the six months after the store’s November, 1985, opening. “I think a lot has to do with the advertising the mall was doing. . . . It was not enough,” he said. When Azteca started increasing its own advertising, business improved markedly, he said.
The developers acknowledge that Plaza Del Sol has had many problems that were not anticipated.
But McNeill said that many malls must endure a rough break-in period marked by slow sales and rapid tenant turnover. The Sherman Oaks Galleria had a 100% turnover in square footage during its first two years of operation, he said.
Turnover occurs because “you never really read the market properly in the development of the fashion level of the mall,” McNeill said.
In addition, Jones said, community leaders told the developers that “for one reason or other it just takes longer for the Eastside community to assimilate new projects. . . . The Hispanic shopper is slower to change his shopping patterns than someone on the Westside” but is more loyal once the switch is made, he said.
McNeill said he was not surprised by the turnover at Plaza Del Sol because the mall never attracted strong anchor tenants. But that is changing, he said.
Landed Thrifty Store
Plaza Del Sol got “a good, strong national anchor tenant” last November when Thrifty Stores opened a Thrifty Jr. in the mall, McNeill said. The mall’s new leasing agent, Grubb & Ellis, is searching for more national retailers who are interested in the mall.
The owners originally wanted Latino store owners who could cater to the largely Latino clientele, but many of those owners were not successful even though some of the dissatisfied tenants were allowed to stay for a year rent-free, he said.
The owners have since realized “we did a disservice by trying to stick with the modus operandi because Hispanics like to shop at national chains,” McNeill said. “They have the same shopping habits that anyone does.”
The mall is “slowly but surely turning around,” Jones said.
“We see a steady increase in shoppers week after week after week,” he said. “We think if we get one or two of the national retailers, the balance of our shops will fill up quickly.”
The owners are working on creating a regional shopping area called Soto Central that would include Plaza Del Sol, an adjacent mini-mall, a strip mall across Soto Street from Plaza Del Sol, and the Sears store. The merchants could then work together on promotional activities, Jones said.
Part of the problem is simply making area shoppers aware that Plaza Del Sol exists, McNeill said. “The real estate development business is a business of patience and deep pockets,” he said.
Might Have Missed Target
Jones said he has been committed to promoting Plaza Del Sol. “We thought we had good exposure,” he said. “We did lots of advertising but maybe we haven’t advertised in the right places.”
Some in the community worry that problems at Plaza Del Sol could discourage other investment in the Eastside.
“Hopefully, this is not something that will be used as a reason not to invest in Boyle Heights or any part of the 14th District,” Alatorre said. “I think their problem is their problem and I don’t think it’s reflective of whether Boyle Heights is a good place to do business.
“It is a good place to do business,” he said. “We’re a very large consuming public.”
Said one longtime Eastside businessman: “At this point, who’s to blame is not the question. It’s a big building that’s ready to do business.”