Reimagined Town Square begins first phase of renovation

PORT ORCHARD — Over the next few years, Port Orchard’s venerable shopping mall on Mile Hill Drive is to be transformed into a 21st-century re-envisioning of its new self: a destination shopping location with three new restaurants and an array of updated retail stores.

But first comes the initial phase of Town Square’s redevelopment, which was commemorated on April 20 next to the main entrance of the four-decade-old mall. Kane Fenner, a developer and co-owner of commercial development company Zaxium, was joined by Mike Brehm, CEO of PowellRyka Construction, and Port Orchard Mayor Rob Putaansuu for a groundbreaking ceremony.

Here’s how the transformation will take place. First, a new facade will be installed on the front exterior of the mall, which Fenner expects to be completed by the end of this summer. He also said the reorientation of the stairs “is a change to occur in the coming years.”

“We’ll have uniform siding and some signage that helps with the [building’s] branding,” Fenner said. “That will be the biggest part of the phase one work. The awnings are coming down, as is the concrete wall next to the entrance. In its place, there will be a black railing that will be see-through at the top for better visibility.”

The red color exterior will change to blue, the co-owner explained, to give the building better curb appeal from the parking lot. The second phase will include a makeover of the parking lot with updated landscaping, lighting, irrigation and new wayfinding signage, he said.

“We’re getting good advice from architects who have lots of experience designing new or existing malls,” Fenner said. “This is a unique space in that it has a mix of retail and office space. We’ve had a number of small office users [as tenants], and I can see those spaces being attractive to startup businesses needing office space for two or three employees.”

The owners of Town Square said consumer shopping trends over the past few decades have changed dramatically. Shoppers who used to plan their trips around store shopping, with a quick stop for a bite to eat, are now looking for a destination primarily for a dining experience, followed by a stroll through the mall to shop.

“People now want an experience [when they’re out in the community]. Our intent is to attract food venues,” Fenner said. “We’ve got a handful of them and you might not decide where to eat until you get here.”

Joining a current Mexican restaurant will be a Vietnamese-cuisine dining eatery that plans to open in a few months. He said the owners of that restaurant also have a location in Poulsbo. And a new coffee shop will open around the same time in an old jewelry store’s vacant space just inside the entrance near Goodwill, one of the mall’s cornerstone stores.

Near the entrance to the old Godfather’s Pizza business, contractors began work on Monday to demolish a stairway and exterior wall. The nearby building entrance will be walled up and a new entrance will be added to the right of that space.

The renovation work, which includes an upgrade to the building’s utilities, will cost “in the seven figures,” Fenner said. And that figure will rise, he said, as they embark on succeeding phases, which will be completed with a revision of the mall’s interior.

Mayor Putaansuu said he was excited to see the renovation work commence.

“I remember when the mall was built some 40 years ago,” he said. “It was the first of its kind in South Kitsap. I’m excited that the mall is under new ownership and is going to get a full facelift and remodel to modernize the facility. It’s much needed.”

The groundbreaking ceremony took place near the first anniversary of Zaxium’s purchase of the then-Towne Square retail center for $9.4 million in late April 2021.

The 155,000-square-foot property was in dire need of upgrades and rebranding, co-owners Fenner and Ray Klein acknowledged at the time of its purchase. In the following 12 months, the company undertook a series of upgrades not visible to shop owners, shoppers, or passersby; the work primarily consisted of infrastructure repairs and upgrades to the roof, plumbing and electrical systems. Klein told Kitsap News Group last fall that $300,000 alone was spent to replace the property’s expansive roof.

The co-owner said a redo of the building’s facade is critical to drawing in new customers — and to entice former shoppers back to the mall.

The ownership team said they looked at a number of shopping malls in the region that have been able to successfully reimagined themselves to better meet the demands of shoppers. One of those malls serving as something of a template is Totem Lake Mall in Kirkland. For three decades, the property skirting to the east of I-405 had seen most of its top retailers depart despite the mall’s prime location. A revolving door of ownership allowed the property, through benign neglect, to become outdated and uninviting.

But in the past several years, the Kirkland mall’s new owners initiated a striking turnaround by reenvisioning the space into a destination location with innovative landscaping and an updated facade. A mix of retail offerings featuring a large number of restaurants, making the center more of a dining destination than a shopping venue, was introduced.

That’s an outcome Fenner and Klein hope for Town Square in Port Orchard.

“The look means everything,” he said. “We’d like to make it a modern, clean, fresh look … It’s a high priority to finish as much of the facade as we can [by the end of this year].”

In the long term, the owners said they plan to widen the building’s plaza into the parking lot, with a stairway spilling out to the exterior lot.

Klein said last fall that Town Square was 90 percent occupied by 70 tenants, many of them on month-to-month leases, which include anchor tenants Scott Mclendon’s Ace Hardware, Goodwill and Grocery Outlet at either end of the center, and a large consignment store inside the mall.

“One of the appealing aspects [of Town Square] is that it’s right across the street from [South Kitsap High School],” he said. “I think it should be a destination for students and their families.”

Fenner and Klein own other properties in the Sodo area of Seattle and Poulsbo. A partnership recently purchased the Amy Burnett Building on 4th and Pacific in Bremerton and undertook renovations in the historic space.

The stairway and exterior wall are to be removed to make way for a grand staircase leading to the mall parking lot. Co-owner Kane Fenner says the stairway is to be completed in “the coming years.” (Bob Smith | Kitsap News Group)

Zaxium commercial development company illustrations show how the exterior of Town Square will look once refurbishment work on the facade is completed by the end of this year. (NGG Partners illustration)