Vintage Real Estate Enters The Atlanta Market With Southlake Mall Acquisition.
March 28, 2014 — Vintage Real Estate of Los Angeles has acquired the 1 million+ square-foot Southlake Mall in Morrow, Georgia, a suburb of Atlanta. Anchored by Macy’s, Sears and the Morrow Center, the city’s events venue, the mall posts annual sales of over $100 million. It serves the South Atlanta trade area of nearly 1 million shoppers and is 90 percent occupied by such national retailers as Victoria’s Secret, American Eagle Outfitters, Footlocker, Helzberg Diamonds, Aeropostale, Bath and Body Works, Finish Line, New York & Co., Children’s Place, City Gear, DTLR, Kay Jewelers, rue21 and Express.
“Southlake Mall already benefits from a great tenant line-up and tremendous freeway visibility in a growing market with impressive leadership,” said Fred Sands, Chairman of Vintage Real Estate. “We have the capital and experience to transform it into a thriving and popular destination for the Atlanta Metro Area.”
Vintage has immediate plans for significant capital investments to bring in new tenants and restaurants, and upgrade the common areas in Southlake Mall. “We will create an exciting new center court for fashion, food and fun,” said Sands. Vintage will redevelop the adjacent 160,000-square-foot building vacated by JCPenney in 2011, which it is under contract to purchase. This building, visible from I-75, opens directly into the mall’s center court. ”We plan to completely transform this space and bring in tenants currently missing from the mall’s ideal merchandising mix such as fashion retailers and popular restaurants,” noted Sands.
Southlake Mall, located at 1000 Southlake Circle, sits on 100 acres at the intersection of Interstate I-75 and Jonesboro Road/Mt. Zion Rd, and is 14 miles from downtown Atlanta and 11 miles from the Hartsfield-Jackson International Airport, one of the nation’s busiest hubs. It stands as the primary shopping destination in an established retail corridor that includes major national retailers, Costco, Home Depot, Burlington Coat Factory, AMC Cinemas 24, Best Buy, TJMaxx, Pet Smart, Old Navy, Barnes & Noble and Publix.
General Growth Properties, who filed for bankruptcy in April 2009, bought the mall in 1997 and renovated it in 1999. In 2007, General Growth Properties placed $100 million of debt on the property. The lender foreclosed on the mall in February 2013. Vintage Real Estate has a proven track record of turning around troubled shopping centers, making them great community assets through well planned and executed redevelopment, management and operations including marketing and leasing.
Foreclosed regional malls such as Southlake Mall typically endure a several-year period of capital constraint leading up to and during the foreclosure process, Sands pointed out. Vintage sees an opportunity to make significant physical renovations and operational improvements at Southlake Mall, which will dramatically improve the customer shopping experience, increase foot-traffic and tenant sales and ultimately create jobs for the surrounding community.
Sands indicated that the company is looking at other acquisition opportunities across the country. “We have the capital and the team to reposition and reinvigorate troubled regional malls. Sellers and brokers know that we do what we say and say what we do. If they want a reasonable surety of closing; they call us.”
This is the first retail property investment in Georgia for Vintage that has been one of the largest purchasers of regional malls in the nation over the last few years. In addition to Southlake Mall, Vintage acquired the 700,000-square-foot Mall at Whitney Field in Leominster (Boston), Massachusetts in May 2013 where it is adding a 66,000-square-foot Burlington Coat Factory. Vintage also acquired the 407,000-square-foot Heritage Mall in Albany, Oregon in December 2012 where it is adding a 62,000-square-foot Hobby Lobby, the retailer’s first store in Oregon. Moreover, the company is underway on the expansion and renovation of The Village at Nellie Gail Ranch, a 100,000-square-foot grocery anchored shopping center in Laguna Hills, California, home to the first Fresh Market grocery in Southern California. Vintage is also renovating its 1.1-million-square-foot SouthBay Pavilion Mall in Carson, California, adding a 13-screen Cinemark stadium seating theatre and several new fashion retailers, jewelers and restaurants. Furthermore, Vintage is opening a new 46,000-square-foot Sportsman’s Warehouse and new 23,000-square -foot Marshall’s at its Wenatchee Valley Mall in Wenatchee, Washington which will complement its existing roster of national retailers that include Macy’s, Ross Dress for Less, and Bed Bath & Beyond.
Sands indicated that the goal for Vintage Real Estate is to acquire three or four malls or shopping centers per year. He stated, “We have a great broker network and we make sure to support them on any off-market opportunities. After all, those are the people that are going to bring us the deals.”