For half a century, a covered wagon graced the entrance to one of Northern California’s oldest shopping malls, serving as a community direction piece, as in: “Turn right at the wagon.” Today, the wagon is gone, but the Montgomery Village in Santa Rosa, California, is signaling a new direction for retail property.
A Boston area developer is giving “the Village,” as locals know it, a full-scale update, joining other landlords remaking outdated, yet well-located, properties across the nation to vie for a shrinking pool of brick-and-mortar tenants and shoppers.
The mall is the first and only West Coast property for WS Development, best known for high-profile projects such as the sweeping 33-acre Boston Seaport project and the makeover of the luxury Royal Poinciana Plaza in Palm Beach, Florida. Now it has a presence in Santa Rosa, a one-time ranching town-turned-increasingly upscale bedroom community some 60 miles north of San Francisco.
“You have to wonder, how in the world, of all the retail properties, did they pick this one?” said Meghann Martindale, a principal and director of retail market intelligence at Avison Young in Los Angeles. On the other hand, she added: “Successful retail is about connecting with the community. ... It’s a lot harder than it sounds, and some developers are very good at it.”
Martindale said the overhaul represents a case study in how shopping malls nationwide are adapting to changing demographics and retail habits in the age of e-commerce. In Santa Rosa, WS Development’s upgrades have drawn in a slew of new upscale tenants while seeking to keep mall’s core identity as a community gathering place.
New tenants come with upgrades
Montgomery Village was owned by one family for more than 70 years before its 2021 sale to WS Development.
At first glance, the mall has little or nothing in common with the iconic Royal Poinciana Plaza in ritzy Palm Beach, where WS Development’s $33 million overhaul drew an array of elite tenants including Hermès, luxury French bookseller Assouline and fashion brand Kirna Zabete.
Santa Rosa’s Montgomery Village has no palm trees or checkered terrazzo floors, of course, but like the Royal Poinciana, it has functioned for decades as a center of gravity for the community.
WS Development paid $93 million to buy the 280,000-square-foot mall from David and Melissa Codding, the son and daughter-in-law of the mall’s founder, who died in 2010 at 92. The sellers told the local Santa Rosa Press Democrat that the developer had approached them “out of the blue” and negotiated persistently for the property over a period of months.
The firm has since installed new roofs, fresh paint, drought-resistant and native landscaping and added security patrols. A covered passageway now bridges the north and south ends of the mall, which has 2,800 square feet of new community space, featuring upgraded turf surfaces, fire pits and accessories such as string lighting along with olive trees “to create a warm and welcoming atmosphere.”
The recent upgrades to the mall and the leasing power that comes from national management have drawn a steady drumbeat of new national brand arrivals including Anthropologie, Sephora, Vuori, the activewear brand of Free People, Mendocino Farms, Sweetgreen and Salt & Straw ice cream. Next year will bring additional openings from Face Foundrie, Beach by Everything but Water, Club Pilates and Blue Bottle.
A handful of local and regional brands are also in the mix, including Rust Boutique, a Sonoma County women’s wear chain; San Francisco-based sustainable fashion brand Amour Vert; and a local Pan-Asian restaurant, Mandarin Kitchen.
“We’ve approached the restoration with care and intention — enhancing navigation, refreshing design details, and expanding gathering places,” said the mall’s general manager, Kris Miller, in an email to CoStar News. “At its core, Montgomery Village remains what it’s always been: a beloved gathering place for the Santa Rosa community. While we’re introducing new brands and modern amenities, our focus continues to be enhancing the overall experience in ways that stay true to our roots.”
The developer did not respond to a request for comment.
‘Changing demographics’
The upgrades reflect a deeper demographic shift occurring in the region.
The Bay Area’s rising cost of living in the wake of the tech boom of recent decades has steadily pushed wealth northward into the picturesque Sonoma County hillsides dotted with vineyards and Redwood trees, spurring changing tastes in things like restaurants and retail.
“If you can respond to those changing demographics, you can make something vibrant and help it be successful and relevant for the next 70 years,” Martindale said. “If you keep it the same, if there’s no evolution to it, unfortunately, we’ve seen some of these shopping areas die.”
Montgomery Village was born during a previous era of great change for American retail. It was one of the earliest developments rolled out by Codding, a legendary figure in Sonoma County’s postwar development boom. Having honed his construction skills with the Navy Seabees in World War II, he built Montgomery Village — named for the town’s first fallen soldier in the war — with 13 local stores, such as Willson’s Clothes Rack, Henderson’s Pharmacy and the Shoe Box.
The mall anchored a residential development that was part of the postwar, car-driven population boom in California’s suburbs. Then as now, the shops benefitted from the open-air mall’s strategic location on Highway 12, capturing locals and tourists exploring the vineyards of the surrounding wine country. Today, Homes.com describes the tract homes surrounding the mall as “midcentury ranch-style homes with manicured lawns and white picket fences along wide, open streets.”
The mall, for its part, has remained a boon to the community, anchored by a mix of boutique local and regional brands like Sonoma Outfitters and Copperfield’s Books. Its tenants mostly managed to weather the COVID-19 pandemic shutdown starting in 2020, with just four of the mall’s 75 tenants closing.
Cool factor
Another key to updating a mall for residents — both old and new — is choosing the right balance of national and local brands that offer retail stability along with what Martindale called “the cool factor.”
“If you don’t have that ... then you’re the same shopping center as in any town, USA, and you’re going to be more prone to e-commerce disruption, to recession,” she said.
Shoppers are leaning toward a mix of smaller format stores, added Neil Saunders, a retail analyst and managing director at analytics firm GlobalData.
“In some ways, these locations are a counterpoint to huge malls which can be a bit sterile and take ages to navigate,” he said.
Not everyone is happy about the changes at Montgomery Village, especially as some local businesses have closed or moved since WS Development took over, including a popular steakhouse called Cattlemens, a California chain known for its decorative carved wooden cowboys flanking the entrance. Other closings included Penzeys Spices, Village Art Supply and Village Bakery. Some cited rising rents, while others said they were simply retiring.
“If you seriously think some big East Coast developer can create a Sonoma County ‘community feel,’ I have a bridge to sell you,” grumbled one commenter recently on Reddit.
Martindale recalled similar local pushback after Southern California developer J.S. Rosenfield & Co. bought and announced plans to renovate a fading outdoor shopping plaza in the town of Larkspur in nearby Marin County, some 40 miles south of Santa Rosa. Today, the property is a bustling mecca known as Marin Country Mart, with upscale stores and restaurants, yoga studios and a weekend farmers market.