Local investors acquire Great Mall of the Great Plains

[Deberg_1990]

Huh....I had no idea they were struggling? I went there once about 10 years ago. It seemed nice, although it did seem to be out in the middle of nowhere.


http://www.kansascity.com/703/story/966242.html

The Great Mall of the Great Plains has new local owners who plan to rename and revitalize the long-struggling Olathe center.

The deal to buy the mall at Interstate 35 and 151st Street from Glimcher Realty Trust was completed Monday for an undisclosed price in the “multi-millions,” according to the new owners, Great Olathe Center.

“The mall draws from a very, very broad demographic and geographic,” said David M. Block, a principal with Block & Co. Realtors and managing partner of Great Olathe Center. “We plan to reposition it to be a driving force in retail sales for the future in southern Johnson County.”

Block said the other five investors wish to remain silent partners in the venture.

Officials with Glimcher, a Columbus, Ohio-based real estate investment trust, were not available for comment. But a previous public filing with the Securities and Exchange Commission said the company planned to use the proceeds from a sale, as well as funds from a line of credit, to help repay a $30 million loan on the property.

Great Mall customers should begin to see more promotions and events within the next two months.

Block said the new owners already are in talks with “entrepreneurial” local and regional retailers and restaurants to fill empty spaces and increase traffic at the mall, which is about 70 percent occupied. He said those businesses will be offered “reasonable” rental rates and short- to mid-term leases with relocation rights within the mall if they are successful.

National tenants are more interested in opening in 2010 to 2012, when the economy is expected to improve.

The new owners also are in talks with Olathe city officials about financial incentives for redevelopment. Block said the incentives are necessary to bring in “new and exciting and large retailers” that will set the mall apart from others in the area.

“When times were good we gave the incentives to the Bass Pros and the Nebraska Furniture Marts,” Block said. “So what do you do when times aren’t as good?”

The Olathe Chamber of Commerce has been working with the new owners since plans for the sale were announced in July.

“It’s nice to have local owners with a great reputation and understanding of the local market and great ideas for redevelopment,” said Joyce Coker-Dreier, spokeswoman for the chamber.

When the Great Mall opened in August 1997 it was the area’s first new enclosed mall in nearly a decade. The “value center” offered 160 stores including outlets and traditional retail and was expected to draw from a wide radius, even tour buses from Branson.

Annual sales were expected to reach $100 million or more and put about $1 million in sales taxes in Olathe’s coffers each year. A second entertainment phase was scheduled to be completed in 1999.

In its first full year of operations in 1998, the mall generated $104.2 million in annual sales. But the owners already were filing suits against current and former tenants for back rent. Some tenants countered with complaints that traffic was less than expected.

The mall ultimately lost anchor tenants such as Dillard’s Clearance Center and Oshman’s SuperSports USA. By 2004, annual sales had fallen to $78 million.

Current anchor Steve & Barry’s is scheduled to close later this month as part of a national bankruptcy. Then occupancy will be less than 70 percent.

Block pointed out that Glimcher Realty Trust doesn’t own any other property in the region.

“They have concentrated and focused on development on two coasts,” he said. Glimcher didn’t have the staff “or the local knowledge to work with the greater Kansas City community to lease and promote that mall. So we’re kind of bringing everything home now.”

Block said the population base wasn’t sufficient to support a nearly 1 million-square-foot mall in 1997. But now the mall can draw on more than 107,330 people within a five-mile radius with an average annual household income of $75,786.

More than 118,000 cars pass the center every weekday and Block said the primary retail trade area is nearly 289,000 people.

Despite its size, the mall is not easily visible from Interstate 35, so more signs will be added. The new owners also may add high-profile entertainment venues and a hotel.

The oval design also requires too much walking for the typical Kansas City shopper, Block said, so walkways cutting through the center of the mall will be highlighted.

The Great Mall also is known for its eccentric decor, including green and purple striped/black and yellow checked carpet, and a new design will be phased in.

“It’s not going to happen overnight, but it’s going to be something we are going to be moving on and we are going to move on immediately,” Block said. “Customers are going to see activity and they’re going to see the effort to try to change the direction this center has had for many years, no attention.”