What’s going on with the plan to redevelop Sunrise Mall?

By Mike Hazlip—
In October 2019, the City of Citrus Heights awarded a $1.2 million contract to create a “shovel ready” plan to comprehensively guide future development of the nearly 100-acre Sunrise Mall property.

After seeking extensive input from the public and stakeholders, the Sunrise Tomorrow Specific Plan was approved by the City Council on Nov. 10, 2021. However, a little over a year later, visible progress at the mall has yet to take place and the city says misconceptions are commonly voiced by residents.

Meghan Huber, the city’s economic development and community engagement director, said in an email Friday that a common misunderstanding is that the city has more influence over the mall than it actually wields.

“There is a common misconception that the City owns the property and can control its improvement or be part of business decisions,” Huber said of the mall property, which is privately owned by multiple owners. “The City does not own the property and has no decision-making authority regarding investment.”

Despite the title, the Sunrise Tomorrow Specific Plan is a general set of guidelines for development of the prime commercial site, according to the 147-page document. The City Council approved the plan, acknowledging that the buildout could look quite different in the end, depending on what private developers pursue.

“The overall purpose of the Specific Plan is to provide a comprehensive direction for the development of the project site while implementing the goals and policies of the Citrus Heights General Plan,” the document says.

The plan outlines six planning areas that roughly follow existing property boundaries. Each planning area sets a maximum square footage for retail, office, and community uses, according to the document. A maximum number of dwelling units or hotel rooms is also established for the residential areas of the site.

The plan has a 20-year timeline, another source of misunderstanding among community members, Huber said.

“We are working diligently to facilitate potential new projects, and we’re hopeful that new construction will start in the near-term,” Huber said. “New projects depend on market demand and each owner’s ability and desire to make deals.”

Development is expected to happen in phases, with currently unused areas of parking lots likely to be developed first.

At the time the plan was developed, the six planning areas were divided up between the mall property’s majority owner Namdar, with three areas, and one area each for the mall property’s other owners: Antioch Street LP, Seritage, JCPenny, and owners Andy Kuen and Shian Liu.

Since then, real estate investor Ethan Conrad purchased the vacant Sears building from Seritage, and currently has several parcels listed for lease or purchase, The Sentinel recently reported.

With the mall being privately owned, Huber said the city has taken a proactive role to make the mall site be as attractive as possible to developers.

“The City has focused on incentivizing site redevelopment by eliminating barriers under our control, including significant density increases associated with the Specific Plan, Environmental Clearance (CEQA),” Huber said. “These are two barriers the Development Community would be tasked with tackling had the City not taken on this role – this greatly reduces risk and increases the site’s desirability to developers.”

While the city says the plan is flexible to adapt to market demand, Conrad told The Sentinel in an email in January that he would like to see the plan modified “so that as much of the existing buildings can be retained as much as possible, versus demolishing all of the existing buildings and constructing new buildings, which will be very costly and may not be feasible.”

What’s in the plan?
The plan envisions creating a walkable “21st Century Main Street,” with five big ideas guiding it: creating an economic engine, livable neighborhoods, streets for people, connected green spaces, and making the site a “community and regional destination.”

The plan allows for tripling of the development previously allowed at the site, with a maximum of 480 hotel rooms, 2,220 residential units, 320,000-square-feet of retail, 960,000-square-feet of office space, 450,000-square-feet of community/institutional uses, and 6,400 parking spots.

Up to 25 acres of open space and 1.5 miles of pathways are also envisioned in the plan, with much of this space being able to be integrated throughout the site, the document shows.

A central feature of the open space areas is Sunrise Commons, an area centrally located on the western side of the mall in a little-used parking area between Sunrise Boulevard and the mall’s entrances. The plan includes setting aside up to 80,000-square-foot for the area.

Centrally located within the site, the outdoor space could be used for events and indoor/outdoor dining, the plan envisions.

The plan also envisions constructing an event center up to 24,000-square-feet in size that could house dining and entertainment venues. Tent-like structures built in other cities, such as the Arizona State University’s SkySong, are shown to illustrate the idea.

A large area at the north end of the site is designated as an “employment anchor.”

“Envisioned as an employment district with office space and supporting uses, including a business hotel, child care center, and restaurants,” the plan says. Two additional employment anchors are also shown in the plan.

Market demand for office space has waned in recent years since the pandemic forced many workers into home-offices, and Huber said the final build-out at the site will depend on market demand.

From October: City says developer considering hotel at Sunrise and Greenback

Another key aspect of the plan is an emphasis on public transportation and pedestrian access to the site’s interior. The document shows a new bus transit center along northbound Sunrise Boulevard that could be integrated with existing and future bus routes.

A third left turn lane for northbound Sunrise Boulevard at Greenback is part of the plan, Huber said, along with a new traffic signal between Sunrise Mall and the Marketplace at Birdcage.

“Similar to the timeline, vehicle traffic ultimately depends on the types of projects and their density,” Huber said. “Traffic was evaluated as part of the Environmental Review for the project. The project evaluated future traffic conditions, including at the site’s buildout, and includes various improvements to improve traffic flow.”

What’s happening now?
Huber said an “Infrastructure Financing Strategy” is currently being completed that will identify sources of funding as the city continues to make the site as attractive as possible to developers — although the mall property’s multiple owners and parcels present challenges.

The city in December submitted an application for housing-related grant funding up to $10 million that would go to support infill development on the mall site, paying for frontage improvements, utilities, intersection upgrades and transit-related improvements.

The city is also currently reviewing an application that “lays out a footprint” for a potential hotel near the corner of Sunrise Boulevard and Greenback Lane. Specific details have not been released, but the city said previously that the applicant, Antioch Street Limited, LP, is in discussion with Presidio Companies, which has developed and operated hotels under Hilton, Hyatt and Marriott brands.

Asked for an update on potential developers for other areas of the mall, Huber said as of March 10 there was “no news to share,” but said the city’s work to remove obstacles to redevelopment will ensure the property “is ready when the market and economic cycles are attractive for development to proceed.”