Sunnyvale Mayor Dean Chu started the project with a short speech before climbing into the giant machine to start the engine.

"It's a great day to start something," Chu said before climbing in. "It's great to witness the beginning of the redevelopment of this area."

The machine bit off several lengths of cement barrier from the top deck of the structure, sending them crashing to the dirt below. Three dozen city officials, project planners and other dignitaries cheered.

The pile of rubble and dust signifies the first concrete steps in the long journey that will ultimately turn the empty lots and buildings of the old mall into a new outdoor "lifestyle center," similar to San Jose's Santana Row.

Project Manager Jane Vaughan, of Menlo Equities, said the day's demolition was largely symbolic, because Fourth Quarter Properties--the company handling the redevelopment--is still waiting to get demolition permits from the city.

There have been a number of attempts to revitalize the area but none have been successful. More than six years ago, American Mall Properties bought the Town Center Mall and began plans to revitalize the area. Its "Silicon Valley Walk and Village Entertainment" project died when AMP's financier declared bankruptcy in September 2002.

Before AMP declared bankruptcy, Harvest Partners, out of Texas, had begun talking with AMP about redeveloping the area, and ended up purchasing the JCPenney building.

During bankruptcy proceedings, Forum Development Group entered into the picture with a plan and the financial backing of Lehman Brothers to redevelop the mall. A prolonged battle over the land among Forum, its partners and Harvest began.

The battle ended in February 2004, when Harvest agreed to sell JCPenney to Lehman Brothers, to make way for Forum's plans for the site.

Forum and Lehman Brothers set up Fourth Quarter Properties to handle the project. Forum then purchased the land from Lehman in April of 2005.

"This isn't a day for Forum; this is a day for Sunnyvale," said Ron Pfohl, managing member of the Forum Development Group, at the demolition ceremony. "There's been a tremendous amount of time and effort put into this project. We're very, very proud to be a part of it."

When finished, what now includes a Target store, a Macy's store and an empty mall between the two will include one million square feet of retail space, almost 250,000 square feet of office space, close to 300 residential units and a movie theater.

Vaughan said they hope to have the demolition finished before the holiday season, to avoid affecting downtown businesses in that traditionally busy time. By the summer of 2007, new businesses are expected to open.