The city of El Cajon is considering acquiring Parkway Plaza as part of a long-term redevelopment project aimed at getting ahead of declining retail trends.
“The city would like to see Parkway Plaza reimagined, but it’s hard for us to talk to developers when we have no ownership stake,” City Manager Graham Mitchell said.
Positioned on an 80-acre parcel in the center of El Cajon, Parkway Plaza is the largest commercial indoor mall in San Diego County. The retail center opened in 1972 and has recently seen a shift in ownership, spurring concern for the future of the space from city officials, Mitchell said.
Starwood Capital Group lost ownership of Parkway Plaza in 2020 after defaulting on Israeli-held bonds. It was then acquired by the current owners, Pacific Retail Capital partners and Golden East Investors.
City leaders hope to redevelop the indoor mall space and get ahead of declining retail trends. But Mitchell said the city faced roadblocks without having the legal authority to make those plans happen. So the City Council directed staff to research the feasibility of acquiring the property, he said.
“There’s a lot of unknown with the mall and we don’t want it to fall through the cracks and become forgotten,” Mitchell said.
El Cajon residents and city officials alike share the concern that shifts in shopping trends could lead to Parkway Plaza becoming what is known informally as a “dead mall.”
Originally, officials were not planning to take charge of the actual redevelopment process.
In December, staff spearheaded community outreach efforts to gather input from shoppers as they crafted concepts for the retail center’s redevelopment to share with the mall’s owners. The city said it would also help pay for portions of the project, such as the environmental review.
The city’s early proposal for the renovation would redesign the mall into a mixed-use site for shopping, housing, social gathering and transit access.
Now, Mitchell said, the plan to potentially acquire the retail center is in the early stages. The city is expected to have a more developed plan and timeline by April, according to a staff report.
The city is considering a variety of ways to purchase the shopping center. For example, Mitchell said funding districts are an option, but noted that “everything is on the table.”
Staff is also researching the feasibility of partnering with other developers or working alongside the existing ownership group, he said.
Officials from Pacific Retail Capital partners and Golden East Investors could not be reached for comment.
Starwood had purchased Parkway Plaza along with six other malls from Westfield Shopping in 2013 for $1.6 billion. Mitchell said the city has not formally appraised the site. However, a market appraisal performed in 2021 estimated the shopping center’s value at $150 million.
In a presentation to the City Council in 2024, an advisor from Hunden Partners estimated that a project to reimagine Parkway Plaza to a mixed-use development could be expected to increase the city’s annual revenues by at least $10 million.
“We want investment to occur there (Parkway Plaza),” Mitchell said. “We want it to be a priority of whoever owns it, and that’s what we’re trying to ensure.”
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