Jan. 9, 2009 6:31 a.m.
HERMITAGE, Pa. A receiver appointed by the Mercer County Court of Common Pleas says the Shenango Valley Mall is "open for business," as the shopping center and three affiliated holdings work through legal entanglements after defaulting on $80 million in loans.
Judge Christopher St. John appointed the global real estate firm of Jones Lang LaSalle, Chicago, as the receiver for the mall on Monday.
"Our leasing and management teams are fully engaged in assessing the mall and its needs," said Greg Maloney, president and chief executive officer of Jones Lang LaSalle. "The mall is open for business and we welcome the entire community to come and shop."
Jones Lang will now serve as the primary leasing and managing agent of the mall, but the onsite management team will remain in place, the company announced Thursday.
"First and foremost, very little will change for members of the community," said Jeremy Murrin, the mall's general manager. "They're not going to notice any operational changes at the mall at all."
Murrin would not divulge specific sales figures, but noted the management was "actually happy to see where our sales were for 2008. We are doing as well as can be expected in this economic climate."
He added the mall did not lose a single retailer in 2008 and doesn't expect to see any closings in the "near future."
The 508,000-square-foot Shenango Valley Mall leases space to roughly 50 retail and service businesses.
Lightstone Group, a real estate development company based in New Jersey, owns the Shenango Valley Mall. The mall and three other Lightstone-owned properties in Georgia, Tennessee, and West Virginia defaulted on more than $80 million in loans in September.
A court can appoint a receiver when a debtor defaults. The receiver then selects the most appropriate firm to manage and lease the asset, and also provides recommendations as to the most profitable course of business for the operation, including a possible sale.
"As the receiver, the fiduciary responsibility is to manage the property, determine ways to increase the net operating income and find an optimal solution for the lenders," Maloney said.
Published by The Business Journal, Youngstown, Ohio