Taubman’s $475M Mall of San Juan gets “knocked out” after reopening

The upscale mall was supposed to be a symbol of Puerto Rico’s economic growth. Today it's anything but.

TRD New York TRD WEEKEND EDITION /
Aug.August 08, 2020 12:00 PM
Mall of San Juan (Taubman)

Mall of San Juan (Taubman)

The Mall of San Juan, in Puerto Rico’s capital, opened to great fanfare in 2015.

But the last five years haven’t been kind to the $475 million upscale shopping center, which has grappled with retail bankruptcies, natural disasters and the coronavirus pandemic.

Today more than a third of the 631,000-square-foot mall is empty and the property will soon lose its last remaining anchor store, Nordstrom, according to Bloomberg. The mall’s rising vacancy and mounting financial troubles are the result of bad luck, bad timing, and possibly overoptimism on the part of developer Taubman Centers.

While roughly half of Puerto Rico’s population lives below the poverty line, Taubman COO Bill Taubman said the company’s research pre-development “showed substantial wealth, growth in tourism, [and] growth in the quality of tourism.”

The Puerto Rican government had recently put $3 billion toward building and remodeling hotels and was offering an attractive suite of financial incentives for outside investors.

But things started to go awry shortly after the mall opened.

The same year that Puerto Rican officials celebrated the mall’s opening, Gov. Alejandro Padilla acknowledged the territory was insolvent. Two years later, Puerto Rico filed the largest municipal bankruptcy in U.S. history, according to Bloomberg.

Hurricane Maria devastated the island in later 2017 and forced some stores in the Mall of San Juan to close for more than a year. The pandemic then forced the mall to shut its doors for 76 days earlier this year.

“They were betting on tourists, they were betting on high-income individuals,” said University of Puerto Rico economist Jose Caraballo-Cueto. “[The pandemic] was the last punch that they needed to be knocked out.”

Taubman Centers, which didn’t elaborate on plans to turn the property around, said that other department stores or entertainment venues might be interested in renting space. [Bloomberg] — Dennis Lynch


Related Articles

arrow_forward_ios
Lincoln Mall in Matteson (Credit: Google Maps, iStock)

Back from the dead? Mixed-use complex eyed at shuttered Lincoln Mall

Back from the dead? Mixed-use complex eyed at shuttered Lincoln Mall
Yorktown mall’s financial future cloudy with massive mortgage coming due

Yorktown mall’s financial future cloudy with massive mortgage coming due

Yorktown mall’s financial future cloudy with massive mortgage coming due
Could Sears’ demise spell doom for malls?

Could Sears’ demise spell doom for malls?

Could Sears’ demise spell doom for malls?
Skender Manufacturing CEO Mark Skender

Another hit to affordable housing: Skender’s modular construction firm closes

Another hit to affordable housing: Skender’s modular construction firm closes
Hamid Moghadan and 455 N Ashland Ave (Credit: Google Maps)

Prologis buys warehouse near Fulton Market District

Prologis buys warehouse near Fulton Market District
Home sales and prices soared in the Chicago area last month

Chicago area home sales, prices soar for first time in years

Chicago area home sales, prices soar for first time in years
Brian Whiting, CEO of Telos Group, and the Old Post Office (Credit: Google Maps)

Lonely at the top: 601W Cos. opens Old Post Office rooftop park in WFH world

Lonely at the top: 601W Cos. opens Old Post Office rooftop park in WFH world
Mayor Lori LightfootLightfoot and a rendering of O’Hare International Airport (Photos via Getty; HOK)

Will Lightfoot ground O’Hare’s $8.5B expansion project?

Will Lightfoot ground O’Hare’s $8.5B expansion project?
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...