The Ghermezian boys have had yet another epiphany for their American Dream.
The giant shopping and entertainment complex, located just a few miles from New York City in the swamps of New Jersey has a seemingly cursed existence. Two decades in the making it was scheduled to have its retail opening last month, only to get shut down in the onslaught of the coronavirus pandemic. While a few entertainment pieces of the 3-million-square-feet-behemoth had opened last fall, it was still largely a ghost mall waiting for its retail tenants.
Now its developers, the Ghermezian family operating under their Triple Five corporate umbrella, have said they plan on positioning the property even more in the entertainment camp. When first conceived in the early 2000s by previous developers, the complex – then called Xanadu – was to be primarily retail with some anchor entertainment facilities like an indoor ski slope, indoor Ferris wheel and assorted amusement park entities.
When it finally took its pre-opening form last year, Triple Five said it would be 55% entertainment with the balance comprised of traditional retailers.
But in an interview with CNBC earlier this week it said the ratio was now shifting to roughly 70% entertainment with retail accounting for less than a third of the total space. “We are going to come out of this super strong … really strong on the entertainment side,” said Don Ghermezian, co-CEO of American Dream, in the CNBC interview. “I think when [coronavirus] is over, people will be so stir crazy. Initially there will be some trepidation … but I think we are going to have so many people.”
Ghermezian told CNBC that no retailers have pulled out of their leases so far, even if he expects some to eventually do that. “There is no doubt that when this is over, there will be retailers that were just making it along … trying to survive. Those retailers that were on the bubble — I fully expect a number of those retailers to be gone.”
The math on American Dream has always been somewhat fuzzy. Earlier this year, the developers said the complex was 95% leased and while they are now saying only that it’s not fully leased, a shift of this degree from retail to entertainment would seemingly have to involve several hundred thousand square feet of leasable space.
Who those entertainment properties would be remains an unknown. American Dream already has an indoor amusement park, a water park, skating rink, miniature golf and the ski slope, one of the few elements of the original design to make it to the opening.
And of course the elephant in the mall remains how –and when – people will feel comfortable congregating in social situations again, particularly close-contact environments like roller coasters and swimming pools where sneezes, coughs and thrill-induced bodily fluids are part of the game.
Coming into contact with fellow shoppers may be troubling enough for many people getting used to crowds again but entertainment venues take that trepidation to a new level.
American Dream has not set a new opening date yet and whenever that is, one can expect a slow restart. In the meantime, Triple Five and the Gherzmanians no doubt continue to have many restless nights waiting for their dream to begin.