A decade ago, real estate developer Kushner Cos. began envisioning how it might redevelop the 1.6-million square foot Monmouth Mall, a 1960s-era shopping center in Eatontown, New Jersey, that it had owned since 2002. Like many of its enclosed brethren across the U.S., the property was losing relevance amid changing shopper tastes despite being surrounded by affluent enclaves like Rumson, Colts Neck and Shrewsbury. Today, Kushner Cos. is directing a $500 million redevelopment to transform the property into Monmouth Square, a “de-malled” open-air center.

The developer is reducing the retail footprint to just under 1 million square feet, thanks in large part to the demolition of the former JCPenney and Lord & Taylor department stores, and is adding 1,000 luxury apartments, a town square and a central public green. RWJBarnabas Health opened an 82,000-square-foot outpatient facility at the center in 2022, and an additional 30,000 square feet of medical space is in the works.

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Progressing to this point however, required assembling a rather large and complex puzzle. Just a few of the pieces were drafting and revising plans, negotiating with third-party property owners to either acquire their buildings or get their blessings for the new vision, persisting through meetings with occasionally contentious Eatontown borough neighbors and officials, and weathering the pandemic.

“Real estate development in general is incredibly difficult, but I would say de-malling and redeveloping a site like Monmouth Mall is next-level difficult,” said Michael Sommer, chief development officer of Kushner Cos., which owns retail, residential, warehouse, office and hospitality assets across 14 states. “It’s like hand-to-hand combat; if you let your guard down even for a second, there are going to be surprises that catch you off guard. It takes not only a lot of vision but also precision in terms of execution.”

Kushner Cos. broke ground on Monmouth Square about a year ago and expects to complete the transformation in 2028. New tenants like Whole Foods Market, national fast-casual Mediterranean concept Cava, local cafe Offshore Coffee Co. and Strong Pilates will open in 2026 and 2027. Meanwhile, Macy’s and other existing tenants like Boscov’s, AMC Theatres and Barnes & Noble continue to operate in the project. All told, existing and pre-lease occupancy stands at 75%.

One of the biggest challenges when taking on a de-malling endeavor is to do justice to people’s fond memories of the mall while continuing to leverage its high-profile location near the Garden State Parkway and the intersection of state routes 35 and 36, suggested Nicole Kushner Meyer, president of Kushner Cos. Her father founded the company 40 years ago, and she grew up in the area. Monmouth Mall has served as a place to take in a family movie and to take her kids to buy sneakers or get their ears pierced.

But the mall’s vibrancy of early this century began to fade. “We realized that there needed to be an adjustment because shopping preferences and behaviors started to change and tenants started leaving around 2014,” she said. “People just weren’t going to the mall anymore, so we began to look at how we could turn that very centrally located 100 acres into a great asset for the community.”

Prior to COVID, Kushner Cos. and then-partner Brookfield Properties secured approval from the borough of Eatontown to add 700 apartments and medical space as part of a redesign that would pop the top off the two-story indoor corridor and create entertainment uses along new outdoor corridors. But amid the pandemic, Kushner rethought the plan, noting that retailers were adopting omnichannel sales and distribution strategies and thus needed less space, Kushner Meyer said. “Even though we had a valuable approval for enhancing the property, we decided that it did not make a lot of sense,” added Sommer, who joined the Kushner in 2021, around the time that it took sole control of the property from Brookfield. The original plan “wasn’t necessarily a de-malling, and the property was still way over-retailed,” he said.

Kushner Cos.’ return to the borough for approval to add 300 residential units and to raze retail space started on a prickly note, especially because the mall provided local jurisdictions with a sizable chunk of property taxes. At the time, Kushner Cos. also was suing to recover millions of dollars of property tax payments over several years, arguing that it had been overcharged as the mall’s value declined, according to press reports.

Eventually, the sides agreed on a plan in which Kushner Cos. would receive a payment in lieu of taxes, or PILOT, incentive and in return would drop the lawsuit. A PILOT provides developers with flexibility and wherewithal to finance a project because it fixes annual tax payments for a number of years instead of basing payments on a property tax rate, which typically increases over time. Construction financing includes a $303 million loan for the apartments from affiliates of Fortress and a $112.5 million loan from Rithm to develop the retail.

Recognizing Monmouth Mall’s key location and the importance of its revitalization to the community, Kushner Cos.’ re-redesign created a two-acre public green that will be a setting for live music, farmers markets, car shows and other programming. From a merchandising perspective, the addition of a tenant the caliber of Whole Foods provided instant credibility, considering that the grocer is known for its rigorous site selection, said Danielle Collins, a partner in Bond Retail Partners, which oversees Monmouth Square leasing. “Whole Foods was a big get for us because it’s a stamp of approval for a lot of tenants when they’re looking for space,” she said. “But it really speaks to our core customer, too. Even though there has been a fair amount of de-malling happening across the U.S., it’s still a new frontier, so you need to have a lot of vision with respect to how you present the site and the buildings and how you treat your customers.”

While the development team has seen strong interest from tenants to occupy the roughly 248,000 square feet of retail and restaurant space still available, it continues to take a thoughtful and methodical approach to ensure it blends the right mix of national brands with local operators to create an 18-hour community. “If this was only about filling the center, we could do it tomorrow,” Kushner Meyer said, “but we’re not just creating an outdoor mall. We’re connecting a thread between all of these different uses to build a sense of community that will continue to grow.”