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Los Angeles

State drops lawsuit against San Bernardino over zombie Carousel Mall

City can move ahead with shopping center demolition, but lacks plans for redevelopment

<p>San Bernardino Mayor Helen Tran and 295 Carousel Mall in San Bernardino (Getty, Amerique, CC BY-SA 3.0 &#8211; via Wikimedia Commons)</p>

San Bernardino Mayor Helen Tran and 295 Carousel Mall in San Bernardino (Getty, Amerique, CC BY-SA 3.0 – via Wikimedia Commons)

In what could be a last chapter for the Carousel Mall in Downtown San Bernardino, the state has dropped its lawsuit against the city over its redevelopment.

Three weeks after the City Council voted to cut ties with the firms it tapped to redevelop the vacant mall, the state Department of Housing and Community Development said the decision resolved its concerns about the project at 295 Carousel Mall, the San Bernardino Sun reported.

“We can now move forward,” Mayor Helen Tran said in a statement following the decision.

According to California’s Surplus Land Act, cities must try to sell or lease excess acreage to affordable housing developers or other entities before they can sell the land. The Inland Empire city had always maintained its innocence after the state accused it of failing to negotiate with affordable housing developers for the land underneath the shopping center, which the city owns. The city maintained it did negotiate unsuccessfully but failed to disclose that to state regulators.

In a letter late last month, David Zisser, the state agency’s deputy director, wrote “HCD considers this matter closed.”

The city has been working for years to overhaul the 51-year-old zombie mall, a two-story building on 43 acres that opened as the Central City Mall in 1972 with 53 stores, including three anchors. The Carousel Mall closed in August 2017 with 110 stores 

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The shuttered center became a hotbed for break-ins and vandalism, leading the city to spend $8 million to tear down the fire-damaged building. Demolition began in April.

The mall tear-down continues, the city said in a news release, though there are no immediate plans to redevelop it. No timeline has been set for bringing in a new developer, according to the statement.

In March 2021, Renaissance Downtowns USA and ICO Real Estate Group, both based in Los Angeles, were chosen by the city to redevelop the mall into a mixed-use residential, entertainment, commercial and office development.

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The developers proposed replacing it with an urban village consisting of 3,500 homes inside an urban-retail complex with river paths and thousands of trees. Lincoln Property, based in Dallas, was added last August to the redevelopment team.

But in October, Lincoln withdrew from the revamp project, citing “economic” reasons.

— Dana Bartholomew

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295 Carousel MallCarousel MallCommercial Real EstateRetailSan Bernardinozombie mall