As Spring Hill Mall shutters, West Dundee mayor gives more insight into the village’s plans for the building

WEST DUNDEE — With malls continuing to die out across America leaving behind large, vacant building structures, the fate of the faltering Spring Hill Mall has been in question for a while with West Dundee village officials.

The mall, which is situated in both West Dundee and Carpentersville, currently only has two landlords remaining: Kohl’s and Kohan Retail Investment Group which owns the former Carson Pirie Scott building and the interior of the mall.

As of recent, the Village of West Dundee Board of Trustees voted to purchase the 192,000-square-foot former Sears Building at Spring Hill for $2 million. This move was in addition to the village’s decision to purchase the former Macy’s building a few weeks prior.

In a previous My Huntley News story, West Dundee Mayor Chris Nelson stated that the village hoped to repurpose the mall into a mixed-use development, “that features walkable neighborhoods and a campus-like setting for office and other commercial uses.”

While West Dundee is hopeful in making use of the slowly dying Spring Hill Mall property, Carpentersville officials have made it clear that they have no interest in buying the 15% portion of the mall that falls within its village limits.

“Acquiring property at SHM (Spring Hill Mall) is not without risk, but the Village Board and I feel that the risk of inaction is greater. One need to only look at what occurred with Lincoln Mall in Matteson (owned by Kohan Real Estate) and the near-decade it took to see any improvements at the site,” said Nelson via Facebook.

According to Nelson, West Dundee will not be pursuing leases and will not be seeking tenants to take over the vacant Sears and Macy’s anchor store properties the village purchased. Instead, Nelson stated that those building structures will likely be demolished in anticipation of future developments.

“Occupancy levels are likely in the 20% range, which would imply that the mall is beyond recovery. This is due, in part, to the sea change in the retail marketplace,” said Nelson. “For starters, there are simply fewer national retailers available. Additionally, remaining national retailers are concentrating their ever-smaller store footprints in areas that have the highest density and/or greatest income concentrations.”

Residents asked Nelson if the village would consider turning Spring Hill Mall into an outlet mall to which Nelson replied that would not be possible for several reasons.

“Discussions regarding a conversion of SHM to an outlet space have perennially been tepid. Adding to the complexity was the fact that covenants signed with mall anchors (such as Macy’s) prohibited outlets in the mall itself. Such covenants remain in place, in concept, but are unlikely to be enforced by retailers that no longer have an operational presence at SHM,” he said.

Nelson continued, “Most importantly, outlets tend to be super-regional developments-meaning that you might have only one or two of them in a geographic region like Chicago (for discussion, this is defined within a 90-minute-or-so drive from Chicago proper). Using that criterion, Chicago already has a saturated outlet market, with outlet malls in the Gurnee/Kenosha area; in Rosemont; and in Aurora. This is evidenced, in part, by the failure of the outlet mall in Huntley.”

Nelson added that it is not feasible to bring in other entertainment venues and/or restaurants to the mall area as those are quite costly and would require substantial investments without a “guaranteed return on investment for developers.”

West Dundee tried to salvage the mall back in 2016 but those efforts ultimately failed.

Nelson explained, “The village negotiated with then-owner Rouse Properties to invest over $30 million in the mall in hopes of revitalizing the space…The improvements did appear to impact the longevity of some stores, with many remaining at least an additional 24 months in the hopes of improved activity in the mall. Ultimately, the investment did not yield hoped-for results, especially during an overall downturn in the retail sector.”

In the end, Spring Hill Mall will continue to decline without any functional anchor stores or strong national retailers in the interior. Nelson describes the phenomenon as “precipitous and irreversible.”

“The process of redeveloping the area will likely take a minimum of five to 10 years. Private development costs would likely exceed $150 million,” he said.

As a final note to add, Nelson told residents that the village will not accept warehouses, data centers, truck depots, exotic vehicle storage, and/or sports complexes as potential incremental or interim uses for Spring Hill Mall.

“The reason stems from the fact that the mall is located in the center of the community, and any use akin to the ones mentioned would be detrimental to the overall culture of West Dundee. The uses are allowed elsewhere in the community, so developers interested in deploying such concepts in the area have other locations from which to choose,” Nelson explained.

West Dundee will continue to work with Carpentersville and its own village officials to continue to finalize mall redevelopment efforts.