Fashion Square Lease Continues Following Home Depot Purchase | Society

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Brian McKenzie

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

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

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

Among those moving into the mall is the Jefferson Area Board for the Aging, which plans to open a 2,500-square-foot Medicare insurance consulting office in the mall’s south wing next to the Eddie Bauer store.

“We are excited to be able to offer in-person counseling for this open enrollment period. [we’re] Thank you to our new landlord for working with us,” said Randy Rogers, JABA Insurance Advisor Program Manager. “We need a bigger space to be able to offer this important service to more people. And we hope to be able to help thousands of people with this site at Fashion Square Mall, along with amplification and phone appointments.”

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

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

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

Home Depot and the local holding company that bought the mall entered into a sale agreement on July 8 on the county courthouse steps in July 2021, effective July 31 of this year, Tubbs said.

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 Circuit Court filed three documents between Home Depot USA and Charlottesville JP 2014-CP, the company that previously owned it.

One of the documents is a document of negotiation and sale without a clear sale price and the other is a list of affected parcels. Another document releases Home Depot from the ground lease and the lease that governs the property.

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

Sears in 2010 It filed for Chapter 11 in U.S. Bankruptcy Court in 2018 and closed the Albemarle County store early next year.

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

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

The assessed value is what the county uses to determine tax payments.

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

Earlier this summer, Albemarle County agreed to lease a portion of the site, including a public safety center, parking lot and pools for maintenance.

Albemarle County Fire Rescue maintenance crews will be on scene, and Albemarle County Police will conduct the department’s traffic stop.

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-luxurious 570,000-square-foot indoor shopping center, which has struggled for relevance in the wake of online sales and the pandemic.

In the year Built in the early 1980s, the mall was once a powerhouse in central Virginia retail. Like other local malls, it lost popularity as people switched to online shopping and many retailers left or went bankrupt between 2015 and 2021.

The mall was bought by Simon Property Group in 2010. In January 2015, it merged with Glimcher Realty Trust to become WP Glimcher.

In the year In late 2019, the mortgage loan held by Fashion Square was placed into special servicing after the borrower notified the lender that projected future cash flows were insufficient to ensure future creditworthiness.

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

Shane Tubbs of Town Crier Productions contributed to this report.

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