Mormon-Backed Mall Breathes Life into Salt Lake City
By Caitlin Kelly, The New York Times -- Across the street from Tiffany and other luxury stores at the City Creek Center, the Salt Lake Temple stands as a symbol of the commercial investment of the Church of Jesus Christ of Latter-day Saints.
The mall, which opened a little more than a year ago, is the centerpiece of a mixed-use development that was financed entirely by the church, which spent, by any estimate, hundreds of millions of dollars. Although the combination of commerce and religion in this case may seem unusual, business leaders and developers credit the mall with spurring new business and enlivening what had been the faded core of Salt Lake City, home to 189, 900.
“The center has added 2,000 jobs and brought more than 16 million visitors into downtown,” according to the Economic Benchmark Report of 2013, paid for by the real estate firm CBRE. Taking into account the improving economy, the report credits the mall, at 50 South Main Street, with helping downtown retail sales increase by 36 percent, or $209 million, in 2012.
The “mall is the single most important thing to happen to Salt Lake City in 50 years, maybe more,” said Bruce Bingham, a partner with Hamilton Partners, a Chicago-based real estate developer. “It revitalized downtown.”
Mr. Bingham’s company has since completed a $135 million, 425,000-square-foot office building nearby, at 222 South Main Street, leasing office space to Goldman Sachs, law firms, financial services businesses and others. “We’re pushing 85 percent leased,” Mr. Bingham said.
Early next year, Hamilton Partners will break ground at 111 South Main Street for a 24-story, 450,000-square-foot building, estimated to cost $150 million.
Thanks to the success of City Creek Center, and its backing by the Mormon Church, banks considering commercial lending for Hamilton Partners’ newest projects feel “comfortable and safe” when discussing major loans, Mr. Bingham said. The church “will never let downtown fail,” he said. “It’s just too important to let it go awry.”
How much the mall actually cost is still a mystery. Was it, as rumored, $1.5 billion, even $3 billion, in cash?
“As a private organization, the Church of Jesus Christ of Latter-day Saints and its affiliates do not release financial information,” said Dale Bills, a spokesman for City Creek Reserve, a real estate arm of the church. “Total investment in the City Creek redevelopment has not been disclosed. The project was privately funded without public subsidies and without debt.”
Mark Gibbons, president of City Creek Reserve, said in 2009 that the church planned to spend “hundreds of millions of dollars” as construction began. “We set aside reserves to build this project, we counted the cost before we started, and we have the resources to complete it.”
The development includes 111 rental apartments, which are fully leased, Mr. Bills added. “Sales of the project’s 424 condominiums are steady, with increased interest in recent months as recovery in the residential real estate market brings prospective buyers,” he said.
Babs De Lay, a local real estate broker, estimates the condominiums are “about 50 percent sold out.”
“It’s hard to get data from the L.D.S. church,” she said. Ms. De Lay said she sold a two-bedroom apartment in the complex for $486,000 in June and a 634-square-foot studio for $213,000 in May.
She said she had sold several apartments to buyers from China and Russia, some intended for their children, who are studying at area colleges.
Aside from Tiffany, other luxury retailers at the mall include Nordstrom, Michael Kors and Hugo Boss. More affordable stores like Gap, The Limited and H&M also are leasing in the two-story shopping center. Its retractable roof is open in the summer and a central, artificial stream is stocked with fish and lined with trees and shrubs. It straddles Main Street, connected by street-level crosswalks and a bridge with etched-glass panels.
Linda Wardell, the general manager of City Creek Center, said the mall had a 98 percent occupancy rate, with 104 stores, seven restaurants and a 1,000-seat food court. “There was a real pent-up demand for shopping in this market,” Ms. Wardell said. “Some people were already buying from these retailers online and they were eager to come here.”
Convention visitors also have been vital to the mall’s success, providing 25 to 35 percent of its sales, she said. The city benefits from year-round visitors to nearby ski resorts, five national parks and, of course, to the Church of Jesus Christ of Latter-day Saints, she said.
For some, the juxtaposition of the mall and the temple is odd, given the temple’s cultural, historical and spiritual significance for adherents. The temple, the first building planned when the Mormons settled Utah, took 40 years to build, work that required great dedication and sacrifice.
But unlike most shopping centers around the country, religious observance does affect this mall, where the shops, except for the restaurants, are closed on Sundays.
Derek Staffanson, 39, a Mormon and a local resident, said he had mixed feelings about the mall project. “In theory, I find nothing wrong with the idea of a religious institution developing the area,” he said. “Churches have a long history of contributing to the civic amenities of their communities.”
“But in practice, I’m very disappointed with the manner in which the L.D.S. church chose to develop the area, the use to which they put it, and what that implies about the church’s priorities,” Mr. Staffanson said. “If they had really been concerned about the local community and ending the blight, they would have built a mixed-income, mixed-use community, focusing on developing local entrepreneurship, community centers and resources, a playground, more like the true walkable urban communities in Europe. That would have truly revitalized the local community, creating more prosperity for all.
“For this huge sum of money to be spent on an edifice for commerce and conspicuous consumption seems at best misguided.”
Franziska Patterson, 35, a Mormon from Burney, Calif., visits Salt Lake City every year but said she would never visit the mall. “I definitely think that, both economically and religiously, this was a very bad decision,” Ms. Patterson said. “If it takes a temple of consumerism to attract potential converts, I feel we are headed in a direction completely opposite to the direction the gospel encourages.”
Kevin Barney, 54, a Mormon who lives in Chicago and has visited the mall twice, expressed a different view. “The church put a whole bunch of people to work during a deep recession,” he said. “For another thing, downtown Salt Lake City had become blighted, and that area is sort of like the Mormon Vatican. I think the church had a responsibility to do something about it if it could.”
Jason Mathis, executive director of Salt Lake City’s Downtown Alliance, a business development group, acknowledged that the church-backed development had drawn a spectrum of opinions.
“In this community,” where about 40 percent of the city’s residents are Mormon, “the L.D.S. is such a powerful large entity, it will be more controversial and evoke strong feelings,” he said. “But they’re an interesting landlord. They’re not worried about the next quarter. They have a much longer perspective than many other investors would have had. They want to know what the city will look like in the next 50 or 100 years.”