Wal-Mart to Anchor Towne Center Project
Abandoning its dream of high-end stores at the Cerritos Towne Center and embracing economic and merchandising realities of the 1990s, the Cerritos City Council last week unanimously approved a 41.6-acre commercial development anchored by Wal-Mart. The Arkansas-based discount chain operates 1,700 of the most successful retail stores in America.
“I’m not excited about Wal-Mart as the major tenant because I supported an upscale center. But I now know that’s an impossible goal in the economically-depressed ‘90s,” said Councilman Sherman Kappe as the council ended months of suspense about whether it would give the nod to a discount store, movie theater complex, restaurants and shops and a large grocery and drug store on land once envisioned for the likes of Neiman-Marcus.
Mayor Paul Bowlen and Councilwoman Ann Joynt, who in September opposed exclusive negotiations for the property with Vestar Development Co., changed their positions after the city staff and development representatives said the project will provide more than 900 jobs, generate $3.5 million a year in revenue for the city, and will utilize the same marble, tile, granite and glass architecture as the rest of Towne Center.
Allan Kotin, economic consultant for Towne Center since 1985, told the council that regional shopping centers and department stores are declining in favor of other retail methods, including discounting. He said that while the Vestar project may represent “some level of compromise” for Cerritos, it is “the best retail development for the site in the foreseeable future.”
Saying she has spent “a lot of time investigating every aspect of the development,” Joynt endorsed the project because it will help “provide a strong revenue base that will last and continue services Cerritos is known for. In the ‘90s, it’s not as easy as it was 10 years ago,” she said.
Bowlen was less enthusiastic, saying he had come to the meeting to vote no but was persuaded by some “good ideas” to make the council’s support unanimous. At the same time, Bowlen said he is concerned that Wal-Mart’s pricing will hurt existing stores in Cerritos. “There will be some loss with the other stores,” he said.
Last fall, both Joynt and Bowlen questioned whether the project was right for the prestigious Towne Center, with its office buildings, Sheraton Hotel and ambitious Cerritos Center for the Performing Arts now under construction.
For his part, Vestar President Lee Hanley promised the city “the nation’s finest open-air commercial mall when it is completed.” Other Vestar representatives said the development will be lavishly landscaped and feature fountains similar to the one already gracing Towne Center between the Sheraton and the arts center.
“It will be a place where people can come, shop, get some espresso, see a movie and not want to leave,” said Paul Rhodes, Vestar’s construction consultant.
Wal-Mart’s real estate manager, Robert Bedard, said Cerritos will get “the best-looking Wal-Mart store in the country,” with an exterior that will cost $700,000 alone.
He attributed negative comments about the store to the fact that Wal-Mart, a staple in middle America, is new to Southern California. “They just don’t know us very well out here yet,” he said.
With council approval behind it, the company plans to begin immediately preparing working drawings. The $35-million development will be completed and open in about a year and a half, according to City Manager Art Gallucci, who recommended approval.
The city will lease the land to Vestar for $1.8 million a year with payments starting 18 months after construction begins, under a 30-year agreement that may be renewed for a total of 90 years. The city also will get $100,000 a year for landscaping and lighting.
Gallucci said a key factor in going ahead is that Vestar, headquartered in Phoenix, “has the funds to move forward immediately. There is very little development going on anywhere due to difficult economic times. They have the money to build.”
Under the development plan, the 125,264-square-foot Wal-Mart store, a 10-screen, 3,000-seat Edwards Theater and the 80,314-square-foot Smith’s Food and Drug Center will be built along the Artesia Freeway (91) east of Bloomfield Avenue.
The development will include seven restaurants, which will face Towne Center Drive, the principal access street to the complex. There also will be a 22,000-square-foot department store, numerous smaller stores in several buildings and 2,315 parking spaces.
Restaurants already committed to the development include Mimi’s Cafe, a French-style bistro; Milano’s, an Italian restaurant, and Islands, a hamburger, steak and taco eatery with Hawaiian decor.
According to the city staff report, an estimated 150 people will be employed during construction, earning $6 million in wages. At full operation, the development will employ 920 people, who will earn $18 million in annual wages.
A significant number of jobs will be aimed at young people, and all tenants will be required to give 24-hour advance notice of employment opportunities to school districts serving Cerritos, including Cerritos College.
The Vestar project drew largely favorable comments from an audience that filled the council chamber for the 2 1/2-hour hearing on the project. However, resident Rick Eiden gave the council a 1,500-name petition opposing the development.
Eiden said it was circulated by volunteers with a group called the Cerritos Community Coalition. Under questioning by Joynt, Eiden denied that the petition emanated from labor unions opposed to Wal-Mart’s non-union employment practices. Kappe contended that people were asked to sign petitions “without having all the facts” presented about the development.
The development received strong support from Shurl Curci, board chairman of Transpacific Development Co., which owns the Towne Center office buildings and the hotel. “This will be an amenity, a positive influence on our project,” he said, adding that the city is losing money each year the property earmarked for retail remains vacant.
