Denver’s Downtown Development Authority is set to buy Denver Pavilions, the open-air shopping mall on 16th Street.
The public authority hopes to pay $37 million for the shopping center, which — like many shopping malls — is plagued by vacant storefronts.
The downtown authority will make a master plan for the Pavilions and bring in an “international retail specialist” to make it a “retail, entertainment and engagement venue,” said Doug Tisdale, chair of the DDA board.
The mall stretches across two city blocks. It’s home to a movie theater, a Lucky Strike bowling alley, 11 shops, and a handful of restaurants and bars — plus a lot of empty storefronts and a giant sign that says “Denver Pavilions.” (There is also a Spirit Halloween at the moment.)
Tisdale compared the mall acquisition project to the transformation of Union Station. The train station had been declining for decades before a major makeover that turned it into a transit hub and opulent “living room” for the city in 2014.
An $85 million loan on the property came due on July 1, according to public records. After the pandemic and dramatic changes downtown, the mall was “in a tenuous situation,” the CEO of Gart Properties told BusinessDen earlier this year.
Denver Pavilions opened in 1998, replacing surface parking lots. It was a $105 million project that received some $32 million in urban renewal bonds. The idea of a galleria-style mall for 16th Street had been in the works since at least 1986.
In 2015, MetLife Real Estate Investors bought a stake, the Denver Business Journal reported at the time. The property changed hands at the time in a $106 million deal. Back then, it was 95 percent occupied.
The public purchase of the Pavilions would be funded by downtown property taxes. The DDA is an arm of the city government that collects and reinvests a portion of tax revenues in the downtown area. Local voters recently authorized the authority to take on $570 million of debt for downtown projects, with payments funded by those downtown taxes.
The DDA had already announced $100 million of spending, including $23 million to buy parking lots adjacent to Denver Pavilions. Those properties are expected to be developed into housing in the long term. Other funds are going to projects like rebuilding Civic Center and Skyline parks.
The mall acquisition deal will require approval from the Denver City Council. The DDA plans to ask for development proposals for the site after closing the deal, which could result in a range of options, including a sale of the property or a joint venture.
The authority could buy the property from the lender, rather than the current owner, a city spokesperson said.
Also, a thought:
Some people used to call the Pavilions the “mall on the Mall,” because it stood on the 16th Street Mall. But the city recently renamed the street to just “16th Street.”
So, maybe we could rename Denver Pavilions to “the 16th Street Mall.”
