Fashion Square Continues Leasing After Buying Home Depot | community


BRYAN MCKENZIE

Although Home Depot has signed a deal to buy Fashion Square Mall, you won’t be buying two-by-fours or washing machines there anytime soon.

Fashion Square is still doing business as usual, continuing with new tenants and leases, according to documents filed with the Albemarle County Planning Department. Mall officials have said retailers currently in the mall will continue their leases.

Court documents obtained by Sean Tubbs, of Town Crier Productions, and shared with The Daily Progress show that the mall has new tenants slated to move into the mall while others may leave.

Among those coming to the center is the Jefferson Area Board for Aging, which plans to open a 2,500-square-foot Medicare Insurance Counseling office in the south wing of the mall, next to the Eddie Bauer store.

“We are happy to be able to offer personal counseling for this open enrollment season and [we’re] grateful to the new owner for working with us,” said Randy Rodgers, JABA’s insurance advisory program manager. “To be able to offer more people this important service, we needed a bigger space. And by having this site at Fashion Square Mall, along with Zoom and phone meetings, we hope to be able to help a few thousand people.”

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Mall officials confirmed this week that Home Depot, the Georgia-based home improvement retailer with more than $150 billion in revenue, bought the mall, except for the Belk women’s store and the former JCPenney storefront. Included in the purchase is the Belk men’s display case, which is separate from the women’s display case.

Home Depot’s national competitor, Lowe’s, has a retail outlet about a mile from the mall.

Attempts to reach Home Depot for comment on the sale or plans for the mall were unsuccessful. The purchase price has not been disclosed.

Home Depot and the local holding company that bought the mall in a July 2021 foreclosure auction on the steps of the county courthouse entered into a sale agreement on July 8 of this year with an effective date of July 31, according to Tubbs.

Tubbs has been a reporter for local news organizations for 30 years. He now produces the Charlottesville Community Engagement newsletter and podcast.

On Sept. 2, Charlottesville District Court recorded three documents between Home Depot USA and Charlottesville JP 2014-CP, the holding company that previously owned it.

One of the documents is a Deed of Sale and Purchase without a clear sale price, and another is a detailed list of the affected plots. Another document releases Home Depot from a ground lease and sublease governing the property.

That document refers to the bankruptcy of Sears, Roebuck and Company, which anchored one end of the mall and was part of the original operating agreement for the mall.

Sears filed for Chapter 11 in U.S. Bankruptcy Court in 2018 and closed the Albemarle County store early the next year.

Online records in Albemarle County do not show an updated ownership of the mall. However, those records often lag behind.

County assessor records show the land the mall sits on is valued at $8,796,000 as of Jan. 1. The building and improvements on the site are valued at $7,329,900 for a total assessed valuation of $16,125,900.

Assessed value is what the county uses to determine tax bills.

In a separate transaction, Fashion Square Assets LLC, a company associated with developer Richard Hewitt, purchased the former JCPenney space on September 10, 2020.

Earlier this summer, Albemarle County agreed to lease a portion of the space for use as a public safety center, including parking and maintenance bays.

Albemarle County Fire Rescue maintenance crews will be on site, and Albemarle County Police will deploy the department’s traffic unit there.

The county will pay $3.1 million to renovate the site and $558,000 for the first year’s rent.

The sale is the latest in a series of ownership changes for the once-full 570,000-square-foot indoor mall, which has struggled for relevance in the wake of online sales and the pandemic.

Built in the early 1980s, the mall was once the driving force in retail in Central Virginia. Like other indoor malls across the country, its popularity waned as people switched to online shopping and many retailers left or went bankrupt between 2015 and 2021.

The mall was purchased by Simon Property Group in 1997. It was assigned to Simon’s spin-off company, Washington Prime Group, in 2014. The spin-off company retained Simon’s strip mall business and smaller enclosed malls. It joined Glimcher Realty Trust in January 2015 and became WP Glimcher.

In late 2019, the mortgage loan secured by Fashion Square was placed into special servicing after the borrower notified the lender that anticipated future cash flows will be insufficient to ensure future compliance with the mortgage loan.

Following a request by Midland Loan Services, the special servicer for Fashion Square, a judge in March 2020 approved the appointment of a special servicer. In 2021, the mall was auctioned back to the lender after defaulting on the loan.

Sean Tubbs, of Town Crier Productions, contributed to this report.



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