The move created momentum in the market, Holmes said, which ultimately drove redevelopment and paved the way for the waterfront development that is currently underway.
While other parts of the city, both on the east and west sides, have grown due to economic activity, the central part of the city has so far been largely overlooked.
The city will engage with the public as it begins to craft a master plan for the area. But it’s safe to say the property will end up looking quite different from how it looks today, Holmes said.
The Tower Mall was built in 1970 and once served as a retail hub for the city, which in those days petered out quickly as you headed east. But Vancouver Mall, which opened in 1977, started to siphon away some of the much smaller mall’s business, and Interstate 205’s subsequent opening pushed growth east. For decades, the shopping center has been in decline.
The property the city bought includes the 186,000-square-foot mall building, which most recently has been anchored by Bethesda Church. The 12-acre site is at the intersection of Mill Plain Boulevard and Devine Road and is part of a larger 25-acre triangular-shaped commercial area bounded on the south and west by MacArthur Boulevard.
“With the city’s commitment to a substantial acquisition in this area, it positions us to play a leadership role in redeveloping an aging area in decline into a vibrant urban village in a part of the city that has not enjoyed the positive impacts of development for decades,” Vancouver Mayor Tim Leavitt said in a statement.
Holmes said he would guess that much of the property, which is now marked by vacancies and dominated by parking lots, will be converted into housing, office and retail spaces.
It will be “more of a village setting opposed to a suburban strip retail,” Holmes said.
In 2005, the property was purchased for $12.4 million, the city manager said. In 2016, it was purchased for $8.5 million. The city bought it from CW Capital for $5 million.
“From a strategic acquisition, we were able to get control of this critical piece of property from a very favorable price,” Holmes said, adding that it will give the city the ability to lead on redeveloping the center of the city.
Already this year a 78-unit housing project, The Shipyard, has been proposed for part of the larger site. The $11.3 million would serve families, seniors and people exiting homelessness.
The city used undesignated general funds to buy the property, which were the result of an economic uptick and a positive close of the last budget cycle. The funding will not tap into the city’s reserves, operating capital or touch any city programs or departments.