Apr. 14--NORTH HOLLYWOOD -- Developers supported by city officials have ambitious designs on turning the faded Valley Plaza shopping center into a $560 million mega-mall, the costliest retail development in the San Fernando Valley.
Seeing the potential for sparking a major redevelopment of the North Hollywood area, Mayor Antonio Villaraigosa and other officials on Thursday outlined the potential for a deal that would involve developer J.H. Snyder Co. and Federated Department Stores Inc., which owns Macy's and other retail stores, but is closing its Robinsons-May stores.
Villaraigosa said his discussions with Federated have pushed the Valley Plaza to a high priority for the firm.
"I expect that to happen," Villaraigosa said. "That will be the biggest investment in retail in the Valley ever -- $560 million -- an investment that will be far beyond (any past retail development).
"You aren't going to get a deal like this unless the city participates. That's a reality of today. I don't necessarily like it, but it's what has to be done."
Snyder has eyed fixing up Valley Plaza at Victory and Laurel Canyon boulevards for the better part of a decade, with six years of delays, lawsuits and turmoil in the retail world standing in the way.
Federated, which owns Laurel Plaza to the south along Laurel Canyon, has committed to putting a high priority on building a new Macy's to anchor the more than 20-acre development envisioned at the Valley Plaza site. It will be part of a shopping center that will encompass more than 500,000 square feet of space.
Other developments nearby are likely to include restaurants, theaters and a park, among other facilities.
Discussions are continuing over what role the city would play in helping the development, similar to efforts that have been done for other major projects in Hollywood, South Park and downtown.
Details of the project remain sketchy, without formal announcements from Snyder or Federated, but Villaraigosa said he has spoken one-on-one with Federated's top executive to win assurances the project would go through.
More than 50 years old and still suffering the effects of the 1994 Northridge Earthquake, Valley Plaza has been heralded as a key to the neighborhood's revival for years.
The project appeared in jeopardy in recent months as Federated tried to decide the future of the store. So Villaraigosa and Councilwoman Wendy Greuel began working directly with the company to ensure that it wouldn't pull out.
"When this is announced, it will be a signature project for the Valley as far as economic development," Villaraigosa said.
Cliff Goldstein, Snyder's senior partner in charge of the area, was traveling Thursday and was unavailable for comment. The company originally won the exclusive rights to renovate the 50-acre Valley Plaza in 2000, but ran into snags when the Community Redevelopment Agency got entangled with the Los Angeles Unified School District, which wanted to build a school on the part of the property north of Victory Boulevard.
"There have been lots of discussions at this side and the other," said Federated spokeswoman Milinda Martin. "Macy's is working with the developer at Laurel Plaza to do something, but we don't have any information we can disclose right now. The discussions have been going on for some time, but the merger kind of hung things up.
"We are working to do something with the site. It's not like Federated is going to abandon the building or anything."
As outlined by city officials, the retail project would slightly exceed the major expansion at Westfield Topanga under way in Canoga Park, which will run $500 million in both corporate and tenant expenditures.
Greuel said nothing had been finalized, but that Federated's decision could allow a project that would jump across Laurel Canyon, making a mall that would include big-box retail, restaurants, theaters, a park and grocery stores. Combined with Snyder's soon-to-be-completed, $200 million NoHo Commons mixed-use project, this would represent a major step toward revitalizing the Valley's former social center and hip shopping district.