Gunning for City Center mall
The big story around Columbus is the city’s lawsuit against Columbus City Center owner TL-Columbus Associates, which is based out of Indianapolis.
A battle is being waged for control of Columbus City Center, pitting city leaders against the mall’s out-of-town owners — each with a plan to redevelop the ailing property.
Yesterday, the city abruptly ended its lease with the mall’s owners and sued for thousands in unpaid rent. It threatened to evict the owner, holding company TL-Columbus Associates, within three days if it doesn’t leave voluntarily.
That would set the stage for Nationwide Realty Investors, which developed the Arena District, to take a crack at the Downtown mall.
The land under City Center is owned by the private, non-profit Capitol South, which seems to own half of downtown. Both Capitol South and Nationwide Realty are major players in the downtown renaissance of course. It’s not surprising that they’d want to toss this out-of-town group out. Guy Worley, CEO of Capitol South (and former Chief of Staff for Mayor Mike Coleman), nearly says as much in this PowerPoint show (page 25):
- City Center’s future is important to Downtown, but right now, we don’t have control over the property.
- 90-year lease to TL-Columbus Associates, an entity comprised of Simon Property Group and the GM Pension Fund.
- They retain legal control over the mall.
You can almost hear the angst. Obviously, the city and Capitol South were waiting for any excuse to pounce on TL-Columbus, and they’ve found it with the non-payment of rent. In the Dispatch article, one of the TL-Columbus guys seems to indicate some kind of double cross:
But Simon Property [half of TL-Columbus] CEO David Simon took exception to that depiction last night, saying his company had a deal to sell City Center to a local group that included developer Don M. Casto III. Simon said the group had been working with Retail Ventures Inc., which includes Value City Department Stores, to operate stores inside the mall.
Simon called yesterday’s news conference by city leaders “a shock” and “bush league.”
Regardless, it’s clear that TL-Columbus gets zero points for their management of City Center.
I’m rather ambivalent about the Arena District. I hope that Nationwide, if the lawsuit goes Capitol South’s way, will develop the City Center site with a bit more character, but I guess I’m hard to please.
David Simon is a big boy. He knows what happens when you don’t pay rent. Ask him how long he lets storefronts stay open in his malls when they don’t pay their rent to him?
Dead malls are pretty worthless in today’s market. I think Westland sold for only about $5 mil, but that included about 50 acres of land. City Center has no land to sell, and it would probably cost $4 million or so to tear it down …… it’s a worthless asset and they know it.
Well said.