When Chapel Square Mall opened in 1964, it was one of the first such malls built in the Northeast and a major shopping destination for New Haven residents. Over the years, with the departure of anchoring stores like Macy’s and the building of suburban centers such as the Connecticut Post Mall, it suffered major losses and was eventually forced to close.

But Chapel Square Development LLC — which includes nationally renowned developer Williams Jackson Ewing and local developer David Nyberg — purchased the space in April 2002 and is currently in the process of giving the mall a completely new look.

Developers plan to convert Chapel Square from an enclosed mall to a mixed-use building complex. There will be ground-floor retail space and a mix of upper-level apartments and offices facing out towards the street. The glass ceiling over the mall’s atrium will be removed so that apartments overlook an outdoor open-air courtyard. A fitness center and food market might also be included.

Deputy Director of New Haven’s Office of Economic Development Tony Bialecki said such a building will be much more successful downtown than a traditional indoor mall.

“It’s that magic mix of uses that really makes a successful downtown,” Bialecki said.

He added that lit storefront windows and an increase in pedestrian traffic will create more of a “24-hour feel” for downtown New Haven.

While several high-end stores such as Crate & Barrel, Pottery Barn, and Banana Republic were being discussed as potential merchants for Chapel Square last year, only a few of the 11 retail spaces on the first floor have been rented. Additionally, New Haven Mayor John DeStefano Jr. has expressed uncertainty regarding the involvement of Williams Jackson Ewing — the firm responsible for renovating Grand Central Terminal in New York City and Union Station in Washington, D.C. — in the development process.

But executive director of the Town Green Special Services District Scott Healy ’96 said that although he had noticed a slowdown in activity last summer regarding plans for the mall’s renovation, such a pattern has been experienced throughout the country.

And despite the perceived slowdown, Chapel Square will be getting its first retail tenant — Ann Taylor Loft — by February. Other stores that should be opening later include the Coldstone Creamery, Rite-Aid, and Radio Shack.

Healy said he was very optimistic that once these major stores open up, the remaining retail spaces will be quickly filled this year.

“That will clearly create a buzz around the property or at least help foster more demand for other spaces nearby,” Healy said. “Ann Taylor Loft means that demand will be spurred by the fact that your neighbor is a national draw.”

Healy said because the city’s reputation has really improved in the past several years and downtown has experienced significant growth, New Haven has a lot of potential to bring in more high-end retail. Additionally, very few high-end retail outlets currently exist in the Greater New Haven area.

“New Haven is a very hot market right now,” Healy said.

Several Yale students said they rarely frequented the old Chapel Square mall when it was open, and if they did it was generally for dollar-store type items and cheap discounts.

“It would have much more business if it had more upscale stores,” Lucinda Brown ’04 said, adding that a bookstore, movie theater, and clothing stores like Forever 21 or H&M would make the mall more appealing to her.

But David Reiman ’05 said that although the mall was run-down, he enjoyed finding good deals there.

“I’d actually prefer that they keep the same kind of stores,” Reiman said.

Healy said the downtown area will see an influx in high-end retail and luxury apartments, but the added diversity will create a healthier and more diverse downtown living environment, rather than displace current residents.

“There will still be room for tenants and businesses that cater to all of the needs of the city,” Healy said. “Downtown will not suddenly change. This is a city that values its character too much.”