Starting Point: St. Paul, MN
Ending Point: Chicago, IL
Distance Traveled: 450 Miles
Today, I woke up and drove to the St. Paul Cathedral, an architectural masterpiece. The grand sanctuary and attention-to-detail throughout cause visitors to be impressed, which may be reason Christianity is such as a successful religion. With all these beautifully designed churches, how can people not feel inspired and in the presence of God while worshipping.
Afterwards, I drove to Bloomington, a suburb about 15 minutes from Downtown Minneapolis, to visit Mall of America. Mall of America was built in 1992 by the door Ghermezian family. The mall is a testament to what can be created by someone who has drive and imagination. The family seems to have a forever hold strategy and dude land leases for the pats surrounding their property. They came to the United States in 1964 and turned the family rug business into a real estate empire. They went from developing simple properties to eventually creating a niche for developing the largest malls in the world
Considering that the shopping mall opened in 1992, the plan for the 5-million square-foot mall must have been come up with no later than the mid-to-late 1980s. That means that construction on the mall likely began at the height of the market and construction continued throughout the depths of the recession in the early 1990s until the project was finally completed in 1992. Many other real estate experts would have considered the construction of Mall of America and Edmonton Mall to be very risky and ill-advised, especially in the bull-market at the end of the 1980s, but the family either had an excellent plan to withstand the 20% interest rates or they had plenty of cash backup to weather the storm.
The family seems to have a strategy of building real estate that are so extravagant that they turn into tourist destinations and draw consumers from all around the country. The effectiveness of this strategy is highlighted throughout the property by some of the entertainment tenants such as Rainforest Cafe, Dick’s Last Resort, and other tenants that only open locations in tourist destinations. There’s probably also a nice sized premium for the entertainment aspect of these malls that also double as tourist destinations. When at tourist destinations, people are usually much more willing to spend money which translates to higher rents, higher property income, and ultimately higher property value. There is also probably very high tenant demand to be located in the shopping mall which leads to a very low market vacancy rate, property vacancy rate and low cap rate. Properties that double as tourist destinations are relatively well protected against challenges such as e-commerce and recessions, because they are free places that people can gather and spend time.
The idea of building an amusement park in the middle of a shopping mall as it’s Center point is brilliant as it adds to the touristy and entertainment aspect of the shopping mall and leads to a higher traffic draw and higher rents for the retail spaces, and also enables the shopping mall to attract entertainment tenants such as rain Forest Café, Dick’s last resort and many other entertainment tenants that feed off of each other’s draw and traffic. The name of the shopping mall, “Mall of America”, and it’s being known as the largest mall in America also contribute to the huge draw of the shopping mall.
I wonder what incentives Triple D received for building the shopping mall. Mall of America has a huge impact on the surrounding area and city and I wouldn’t be surprised if the project was heavily subsidized or heavenly incentivized. T wonder why Triple D properties decided to build the mall in Minneapolis of all cities maybe it was highly incentivized there? When triple D properties announced the American dream project in New Jersey, Governor Christie seem to boast about the huge benefits to the city because of the new shopping mall, and I wouldn’t be surprised if Minneapolis was just as excited and welcoming for the mall of America and provided heavy incentives and subsidies
I arrived at the mall at 7AM, too early for any of the retail stores to be open. However, I was lucky that the doors were open and several coffee shops inside the mall, including a Starbucks. I walked around the empty mall for about 30 minutes and admired it’s layout, design, natural light, and genius of including an amusement park inside the mall.
After, I drove a couple of hours to Madison, the Capital City of Wisconsin. When I checked Yelp, the two main attractions in the city were the state capitol building and State Street, both of which are located in downtown Madison. The State Capitol building is incredible. To fully appreciate the beauty of the building, we also need to take into account the entire Downtown area which is incorporated into the design of the Capitol Building. As the below aerial photo shows, the Capital building is located in the center of downtown Madison. There are four major streets extending from the building, one of which is the previously mentioned State Street. There are four lawns, one on each side of the building. There are four wings to the building, all of which appears to be identical. The symmetry continues to the beautifully-restored interior which also seems to be symmetrical. At the center of the building (and therefore also the center of Downtown Madison) there’s a huge atrium where all four wings can be seen. Also, there’s an observation deck on top of the building, with Downtown and water views.
Next, I drove to Milwaukee, Wisconsin. In my few hours visit, I visited Trip Advisor’s recommendations of Milwaukee Public Market, the historic third ward district, and the Riverwalk. In an otherwise dead and declining city, Milwaukee’s beautiful Downtown area, hip third ward district, and beautiful Riverwalk provide a much needed off-setting boost. Visiting these area, got me excited about the urban/downtown revivals currently underway throughout the country and the limitless potential of Downtown Los Angeles and the proposed river restoration/walk.
Many hip restaurants, Cafes and retail stores are located in the third ward district. The center piece of the third ward is Milwaukee Public Market, a $10 million publicly subsidized marketplace modeled after Seattle’s Pike Place Market. The market houses many niche food stores and is a beautiful atmosphere which may have kickstarted the entire third ward district revitalization.
After a couple hours more driving, I reached Chicago, IL. I was pleasantly surprised by the upper-class area, which was much more affluent than I was imagining. The best way to describe Chicago is like a mixture of Manhattan and Downtown SF, which much more emphasis placed on outdoor seating, more relaxing feel, and all the luxury. The waterfront (and entire downtown area) are lined with sophisticated high-rise office and residential buildings, with a younger demographic group. Based on my limited exposure to Chicago, it seems like Blackstone acquired Willis Tower at a bargain price of only ~$350/sf for a trophy/core property.
Based off of some research it seems that I was visiting/touring the best part of Chicago, where crime is very low, employment is strong, and real estate values are strong. However, most neighborhoods in Chicago aren’t holding up as well. (http://www.businessinsider.com/chicago-is-the-worst-american-city-2013-6)
After about a half-hour of walking through downtown and Millennium Park, I rented a bike from the easy-to-use bike rental service and rode on the waterfront and around Downtown for about 90 minutes. After the bike ride, I felt like I had a pretty good exposure to Chicago, and drove to Gary, Indiana to spend the night at a Motel 6.
