Business/Economy

South Anchorage outlet mall project stalled

Plans for a retail development in South Anchorage have stalled, leaving a tree-filled swath of land where it might have been.

Anchorage developer JL Properties said in 2013 it was planning an initial 200,000 square feet of retail space, called The Outlets of Alaska, across C Street from Target, at 100th Avenue.

But Leonard Hyde, president of JL Properties, said the tenants just didn't come. Now, the company is no longer working on the project.

"We were not able to get adequate lease commitments from national retailers to make it economically attractive, and the economic headwinds made it worse toward the end," he said. "When oil prices crashed it became clear to us that this project was not going to happen. At least, not any time soon."

A decline in oil prices that began in 2014 is expected to have other economic impacts in Alaska as well, such as the state's first annual job loss since 2009.

Hyde said that large retailers wanted to pay the same amount of rent per square foot that they might pay in the Lower 48, and "weren't willing to pay, if you will, an Alaska premium. That's the reason it was ultimately not very attractive to go forward with the project."

He wouldn't say which retailers the company was talking to about locating on the 27-acre piece of land. Eventually, he said, the project would ultimately take up 300,000 square feet, for a cost somewhere in the neighborhood of $85 million.

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This doesn't necessarily mean the project is dead forever.

"It's possible at some point in the future that this project could come back," Hyde said. "We continually look for ideas to develop the property, but we are not currently working on the project."

JL Properties told the Anchorage Daily News in 2013 that it was planning on a tentative opening date of October 2015 for the shopping center.

That same article said that Dimond Center LLC was planning a shopping center with the same name. A representative at the Dimond Center did not respond Monday afternoon to a request for comment about that project.

John MacKinnon, executive director of the industry group Associated General Contractors of Alaska, said such a thing might be expected in Alaska's current economic state.

"Private investment likes to be confident in the policy the government is doing," he said. "The inability to pass a fiscal plan is resulting in some lack of confidence, and a lack of willingness to invest."

The city is planning on building out 100th Avenue, which currently dead-ends at C Street between where The Outlets of Alaska would be and a wood lot, so it will extend from C Street farther west, to Minnesota Drive. Jerry Hansen, director of project management and engineering with the municipality, said the city hopes to finish that project next year.

Hyde said the road wasn't really a factor in not opening the shopping center, but that "once that road is complete, all of a sudden that 27-acre property is at a very important area."

Related: Outlet mall with dozens of shops proposed for South Anchorage

Annie Zak

Annie Zak was a business reporter for the ADN between 2015 and 2019.

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