Port Authority Moves on Simon Financing, Offices
VIENNA TOWNSHIP, Ohio -- The Western Reserve Port Authority advanced a plan Wednesday to provide financing for energy efficiency improvements at Southern Park Mall, and by early 2014 will move its economic development division from the Youngstown Business Incubator to larger offices just north of the central business district.
The port authority is in discussions with Indianapolis-based Simon Property Group, which owns the Boardman Township mall, to provide up to $4 million in financing for upgrades to the mall’s roof and a complete interior lighting retrofit, said Pam Ferguson, the mall’s general manager.
Members of the port authority’s board of directors voted at their monthly meeting to authorize Rose Ann DeLeon, the authority’s executive director, to execute a financing term sheet for the proposed energy efficiency improvement project at the mall.
The port authority would issue Property Assessment Clean Energy bonds to finance the improvements and the bonds would be repaid through assessments collected with the mall’s property taxes, DeLeon said. The PACE bonds allow the property owner to finance 100% of the costs of the improvements, with no out-of-pocket costs, and repay the bonds for a term up to the useful life of the improvements. Simon, which is based in Indianapolis, is considering a schedule of up to 15 years, she said.
The port authority would receive a 1.5% fee based on the value of the loan. Simon officials are still considering how much they want to borrow and the term of the loan,
The Boardman Township Board of Trustees must create an energy improvement district before the port authority can give final approval to issuing the bonds, DeLeon said. Trustees are expected to take actions to create the district at two separate meetings next month. If the port authority and Simon come to terms on the loan, the port authority would issue the bonds by the end of the year.
“We want to get under way in early 2014, as soon as weather permits in terms of the roof,” Ferguson said. Replacing the roof is the primary consideration but depending on how much Simon is able to borrow, it would also move forward on the lighting improvements as well, replacing the existing lights with light-emitting diode -- or LED -- lighting.
“It certainly would improve the aesthetics but also the energy savings component is significant,” Ferguson said. Ideally, the lighting upgrades would be made concurrently with the roof repairs, which would take place over a two-year period. Using the PACE financing would free capital funds for Simon to use for other needed upgrades at the mall, she added.
“The roof replacement is going to help with leasing,” Ferguson remarked. “We have some tenants that are looking at us.” She noted that the mall remains the “premier shopping destination” for Mahoning and Columbiana counties and western Pennsylvania, and its numbers remained strong even during the 2008-2008 downturn.
“People still come to the mall but they would like to see the new stores. We know that we’re underserving the better women’s apparel [market] so we’re looking in that direction,” she said. Franchesca’s, a national women’s specialty boutique new to the Mahoning Valley market, is taking space in December and is expected to open in spring.
“Of course, the focus is going to be in the Sears wing because we’re fairly well leased up and strongly leased in the rest of the mall,” Ferguson reported. She also said the mall is “aggressively” marketing the space formerly occupied by Jillian’s.
The port authority economic development division’s move from the incubator is driven by demand for space there, DeLeon said. YBI gave notice in June 2012 that it was going on a month-to-month lease, and she was notified more recently that by the first quarter of 2014, they would be asked to leave. She hopes to relocate by the end of the year.
Of the port authority board, five voted in favor of leasing the space. Richard Schiraldi, citing a conflict of interest, recused himself from voting and excused himself from the meeting when the vote took place, and Andreas Visnapu abstained. Richard Musick did not attend the meeting.
DeLeon and Sarah Lown, senior economic development manager, will go from sharing a small office at YBI to taking first-floor space in Penguin Place with three offices, a conference room and small reception area. The North Champion Street building, which is located near the Main Library of the Public Library of Youngstown and Mahoning County, is owned by Youngstown Thermal.
The port authority will pay $833 per month for the new space, compared with $145 per month for its current office at YBI. The larger space will allow the port authority to host meetings in its own offices, something it was constrained from doing at YBI, as well as bring in house Dan Mamula of the Mahoning River Corridor Initiative, who is still operating out of space at Youngstown State University. The port authority absorbed the initiative in December 2012.
During the meeting, Dan Dickten, director of aviation at Youngstown-Warren Regional airport, which the port authority operates, reported that total enplanements for 2012 were being upwardly revised by about 1,300, to 79,798. Enplanements remain about 8,400 ahead of where they were a year ago and are projected to hit at least 91,000 for 2013, he said.
Copyright 2013 The Business Journal, Youngstown, Ohio.
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