By Ian Ritter

The Macerich Co. embraces the desert. San Bernardino County‘s High Desert is home to the REIT’s Mall of Victor Valley, in Victorville, CA, which it has owned for eight years. The mall is one of the top retail draws in the area, nearly 100% leased and going through a facelift that includes the addition of a new Macy’s anchor. Though Macerich owns 63 regional shopping centers across the United States totaling 64 million square feet, and is one of the largest mall owners in the country, Skip Kuhn, the firm’s vice president of development, took some time to tell us about what makes this particular asset a standout in the portfolio.

GlobeSt.com: Tell us about your retail assets in the High Desert.

Skip Kuhn: Macerich has owned and managed The Mall of Victor Valley for over eight years. This regional center, today with three major anchors (Sears, JCPenney and Cinemark Theatre) and a new one – Macy’s – arriving next year, is a highly successful property. Across our portfolio, our key properties are always evolving to meet the changing needs of retailers and consumers. Here at Victor Valley, we are renovating all four of the property’s major entrances; we recently completed renovations at the soon-to-open Penney; and we are working toward the opening of our new, full-line Macy’s department store in spring 2013.

In addition to The Mall of Victor Valley, Macerich owns a number of other shopping centers in California, and Santa Monica is home to our corporate headquarters. Inland Center is an estimated 35 miles away and offers Coach, The Disney Store, Macy’s, Sears, Vans and Zales.

GlobeSt.com: What has been the latest news at Victor Valley?

Kuhn: In early October, Penney will officially open its 93,000 square foot, single story, full line department store. The new store will feature recognized brands such as Sephora, Liz Claiborne, I Heart Ronson, Bisou Bisou and Levi’s. The expanded store is opening in the former Forever 21 location and will be approximately twice the size of the current jcpenney.

In spring 2013, Macy’s will open its doors to a brand new 103,000-square-foot department store. The store will feature Macy’s
well-regarded set of national and locally edited merchandise.The center’s Cinemark Theatre recently completed a renovation of its own. The theater boasts the largest HD Theater in the High Desert and offers wall-to-wall and floor-to-ceiling screens.

The center is also in the midst of remodeling all four major entrances. The sleek glass storefronts and travertine stone give
the center a whole new look and feel. Along with new landscaping and additional seating, The Mall of Victor Valley becomes even more inviting. Construction on the four entrances is taking place right now and two of them opened over Labor Day weekend and the other two will be complete just in time to celebrate the opening of the new Penney in October.

GlobeSt.com: What you see as the greatest opportunity at Victor Valley?

Kuhn: The Mall at Victor Valley is the dominant shopping center for this key part of Southern California. The property’s high-profile location on I-15 and Bear Valley Road; its loyal shopper base; and strong working relationships with the City of Victorville contribute to its continuing success. The fact that Macy’s is building a brand new store here is testament to the power of this center and this market, and we look forward to adding even more national brands to our already strong roster of stores.

GlobeSt.com: Why do you think this asset has performed so well, and how were you able to attract Macy’s
to the center?

Kuhn: For many years, Southern California’s High Desert has been a fast-growing market thanks to family-friendly housing prices and good employment opportunities. Since it was built in 1987, our well-situated property has been continually
serving the needs of this market by always evolving to meet the changing preferences of the community. New stores, fresh amenities and modern design elements help keep this property top of mind for Victorville and the region. All of these reasons made our location desirable for a premier national fashion anchor like Macy’s.

GlobeSt.com: What has driven new tenants to move to your center?

Kuhn: The powerful combination of strong demographics and the center’s collection of brands, make The Mall of Victor Valley a natural choice for retailers who want to reach the region’s attractive and ready consumers. Additionally, the effective management team maintains excellent working relationships with the City of Victorville and contributes to a friendly business environment for the retail community. In all, more than 546,000 square feet of shopping space that includes Sears, Penney and soon, Macy’s, meets the needs of this appealing market. This center is also home to in-line stores that include Bath and Body Works, Vans, The Children’s Place, Victoria’s Secret and Barnes & Noble, to name a few.

Our leasing team is always in talks and negotiations to bring new and exciting retail and entertainment to this dynamic
center. The expansion of Penney, the addition of Macy’s and Macerich’s capital investment in the Mall of Victor Valley have spawned a new interest from retailers formerly not in the market. Looking forward, we are excited by current negotiations and look forward to announcing our new merchants in the near future.

GlobeSt.com: What is your perspective of retail in that region?

Kuhn: The Mall of Victor Valley continues to be a powerful draw for High Desert consumers and beyond. The center creates a nexus that enhances the regions retail offerings and we are proud of the center and its recent additions.

Retail and entertainment in the High Desert has always been responsive to the consumers and the Mall at Victor Valley is no exception. The Mall of Victor Valley is committed to family friendly events from the quintessential holiday visit with Santa to an on-going partnership with Circus Vargas. With our new and expanded anchors and the addition of the new-to-market retailers, The Mall of Victor Valley is a stronger retail draw than ever.

Over the next 36 to 48 months, approximately 400 new jobs will be created in Victorville, Calif. This is being made possible through the lease Stirling Capital Investments secured with United Furniture Industries (UFI), a manufacturer of affordable furniture that is sold primarily under the Simmons brand name. UFI will occupy a 505,192-square-foot industrial facility at the Southern California Logistics Centre (SCLC) in November 2011. The 1 million-square-foot building was part of a large investment Stirling Capital made in 2009 in a strategic move to attract businesses like UFI that need space more quickly than the ground-up development process.

“We are thrilled that UFI is adding a significant number of jobs to the Victor Valley. Over the past few years, we made a substantial investment in the local community, which has resulted in well over 500 jobs, significant tax revenues for the City, and an overall boost to the local and regional economy,” said Brian Parno, chief operating officer of Stirling Development, the managing partner of Stirling Capital Investments.

UFI, a Mississippi-based company, has signed an agreement that will position the company with a West Coast manufacturing and distribution facility to better serve Southern California and Western U.S. markets. Immediately, the firm plans to hire 100 people and grow to approximately 400 employees within the next 36 to 48 months.

“This is a great example of the public-private partnership at Southern California Logistics Airport that is meeting its goals to create jobs and develop a long-term economic engine,” said Mayor Ryan McEachron. “In times like this, our partnership is taking action to make things happen, not sit around and see if the State or Federal government will bail us out.”

“UFI will begin the process of local staff development in October. We plan to complete a soft opening of manufacturing and distribution operations in November. We expect our employment to exceed 100 people early in the first quarter of 2012,” said Bob Cottam, spokesperson for UFI.

The County of San Bernardino’s Department of Workforce Development will assist UFI in the hiring process. A job fair will be advertised in the local press in October. Additionally, UFI has hired a private consultant from the region to aid the firm during this hiring and staffing process, and develop a productive workforce in the High Desert.

Cottam further stated, “UFI has a history of making every effort possible to procure goods and services in the local communities where we have a manufacturing presence. We are excited about the prospects for our success in the Western United States and this new facility in the California High Desert. From day one, when our team arrived in Victorville, to evaluate the region and the SCLC complex, the City and County were most accommodating and helpful in their advice and guidance.”

Joseph W. Brady, CCIM, SIOR of the Bradco Companies represented UFI in the transaction. Stirling was represented by Jay Dick and Mark Latimer of CB Richard Ellis. “UFI chose to locate at Southern California Logistics Center due to an easily accessible workforce in the Victorville area and the availability of a high quality, existing building. Stirling has put up a great building in a well-conceived master plan,” said Brady.

The UFI commitment follows in a trend of recent leasing activity at SCLC. To date in 2011, leases have encompass more than 1,078,000 square feet with companies including a major confectionary company, Sparkletts® Water, Embry-Riddle Aeronautical University and Southern California Aviation (SCA), among others. These companies join an extensive roster of companies located in the High Desert that includes Boeing, GE, Dr Pepper Snapple Group, ConAgra Foods and Plastipak.

SCLC is master planned for 60 million square feet of commercial and industrial development and is undergoing a 6.5 million-square-foot first phase. Approximately 3 million square feet has been constructed to date.