Merle Hay Mall, Urbandale–Des Moines, Iowa, September 20, 2025
News Summary
The owner of Merle Hay Mall has presented a revised plan to demolish the vacant former department store and build a new multipurpose arena, paired with an eight-court volleyball training center and an accompanying hotel. The Iowa Economic Development Authority accepted the amended proposal for re-scoring and set firm financing and development milestones — including securing roughly $41.7 million in project financing, naming hotel and housing conversion developers, and closing construction financing — before a tax rebate can be confirmed to back bonds. Proponents say a purpose-built arena will be faster and less costly than retrofitting the old structure.
New plan calls for demolition of former store and a new multipurpose arena at Merle Hay Mall
The owner of Merle Hay Mall, a shopping center now 66 years old, has presented a revised plan to build a multipurpose arena at the mall and to demolish the vacant former Younkers building to make room for it. The Iowa Economic Development Authority (IEDA) board accepted the amended plan for a new scoring process on Sept. 19 and set a series of financing and timeline conditions before the project can move forward with the tax rebate that would back bonds for construction.
What the IEDA action means
The IEDA board voted to send the revised proposal to a committee to re-score it under current rules. The board placed conditions on the acceptance, including firm financing and development deadlines. The agency directed its director to appoint a panel to review and score the modified plan; that panel will present findings to a due diligence committee, which will then make recommendations to the full board.
Financing and conditions set by IEDA
The board specified several milestones the mall owner must meet for the project to retain eligibility for the tax rebate that supports bond financing:
- Secure $41.7 million in financing by the end of March (year not specified).
- Select a hotel developer by the end of 2027.
- Close construction financing by the end of 2028.
- Select a developer for converting an on-site office building to housing by the end of 2026.
- Close financing for that residential conversion by the end of 2027.
Project design and timeline
The new plan drops the earlier idea of reusing the shell of the former Younkers store, which has been empty since 2018, and instead proposes demolishing the building to build a purpose-designed arena. The new facility would serve multiple uses beyond hockey, including soccer, concerts, other events and an eight-court volleyball training center. Officials say a purpose-built structure will be faster and less costly to build than trying to adapt the old store’s fixed structure.
The mall owner expects to begin demolition in late winter and aims to open the arena in fall 2027, with construction expected to take about 18 months if approvals and financing fall into place.
Costs, prior awards and municipal backing
The project originally won a $26.5 million state financing award in a 2020 competition that allocated $100 million in tax rebates. That earlier plan was to adapt the Younkers shell and had been tied to a local junior hockey team that later withdrew. After rising costs and financing hurdles, the public-facing project was scaled back to a less-ambitious $41.69 million plan. Under the revised approach, the city where the old Younkers building sits plans to issue $16.3 million to $20 million in bonds backed by the tax rebate. Two cities that share the mall’s footprint have pledged support, including an additional $3 million in tax-increment financing (TIF).
Background and recent history
The initial arena concept dated back several years and was meant to replace an aging rink damaged in a 2020 storm. The original project was estimated at about $60 million, but inflation and higher borrowing costs after the pandemic made fundraising harder. A local hockey team had been involved early on, began work in 2022, and pulled out in 2024. The mall owner then continued the effort independently.
Local studies, support and nearby projects
The city that would issue the bonds commissioned an updated sales-tax projection study before reintroducing the plan to the IEDA. That study warned that an arena alone would not reverse long-term declines at the mall and that traffic and sales gains could be smaller than owner estimates. The mall owner disputed those findings and presented its own research showing millions of visitors to the mall in the previous year. Local elected officials and staff expressed varying views about how much the project could boost the property, but both cities covering the mall have signaled support and concern about keeping the center in good condition.
At the same IEDA meeting, a separate mid-sized arena and convention project at a regional sports complex received a $5 million tourism grant. That project has similarities in size and cost to the Merle Hay proposal, though proponents of the mall arena view the two facilities as serving different neighborhoods.
Next steps
The IEDA panel advanced the amended district plan unanimously to the full board’s due diligence review. The mall owner must meet the IEDA’s financing and development deadlines before the sales and hotel-motel tax rebate can be confirmed to back construction bonds. If those steps are met and construction financing closes on schedule, demolition could begin late this winter and the new arena could open in fall 2027 under the current timeline.
FAQ
What is being proposed at Merle Hay Mall?
The plan calls for tearing down the former Younkers building and constructing a new multipurpose arena that can host sports, concerts and other events, plus an eight-court volleyball training center and an accompanying hotel.
Why demolish the old Younkers building?
Demolition is expected to speed up construction and reduce costs compared with trying to adapt the old store’s fixed structure, which would have required major structural work.
How much will the arena cost and who is paying?
The revised project budget is about $41.69 million. The city plans to issue $16.3 million to $20 million in bonds backed by a state sales and hotel-motel tax rebate, and the two cities have pledged $3 million in tax-increment financing support.
What financing and timeline conditions did the IEDA set?
Key conditions include securing $41.7 million in financing by the end of March, selecting a hotel developer by the end of 2027, closing construction financing by the end of 2028, selecting a residential conversion developer by the end of 2026, and closing financing for that conversion by the end of 2027.
When could construction and demolition start?
The owner hopes to start demolition late in the winter and aims to open the arena in fall 2027, with an expected 18-month construction span if approvals are granted and financing closes.
Will this compete with other regional arenas?
Another mid-sized arena and convention project nearby received a separate grant. Officials view the facilities as serving different parts of the metro area, and the mall arena is being planned to serve its own neighborhood market.
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Key project features
| Feature | Detail |
|---|---|
| Site | Merle Hay Mall (straddles Urbandale–Des Moines border); former Younkers building to be demolished |
| Owner | Mall owner pursuing project independently |
| Project type | New multipurpose arena with hotel and volleyball training center |
| Uses | Hockey, soccer, concerts, events, eight-court volleyball training center |
| Estimated cost | Approximately $41.69 million (revised) |
| State support | Originally awarded $26.5 million in 2020 competition; amended plan subject to re-scoring for tax rebate |
| Local financing | City to issue $16.3M–$20M in bonds backed by tax rebate; $3M pledged in TIF |
| Key deadlines | Secure $41.7M by end of March; hotel developer by end of 2027; construction financing closed by end of 2028; residential developer by end of 2026; residential financing closed by end of 2027 |
| Construction timeline | Demolition hoped for late winter; 18 months construction; target opening fall 2027 |
Deeper Dive: News & Info About This Topic
Additional Resources
- Des Moines Register: Big change in Merle Hay Mall arena plan
- Wikipedia: Merle Hay Mall
- KCCI: Merle Hay Mall mixed-use arena and ice rink plan
- Google Search: Merle Hay Mall arena
- WHO13: Des Moines approves changes to Merle Hay Mall hockey arena project
- Google News: Merle Hay Mall arena
- WeAreIowa: Merle Hay Mall arena — hockey, volleyball, concerts
- Encyclopedia Britannica: Merle Hay Mall (search)
- Business Record: Merle Hay Mall pursuing lease agreements for proposed arena
- Google Scholar: Merle Hay Mall arena
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