Regency Square Mall, Jacksonville’s first regional shopping center in one of the city’s first suburbs, Arlington, is again on the verge of a sale.
To complete any large purchase, a prospective buyer typically completes a due diligence review of property conditions.
At Regency Square, developed 56 years ago at 9501 Arlington Expressway, those conditions have been a target of lawmaker complaints and city code compliance.
The city said Oct. 5 it will hold a hearing in the coming months on the fines and repeat code violations at the mall, which has been closing off wings and losing tenants.
Only five tenants remained operating Oct. 4 within the east wing, the only part owners have kept open.
Owners said Oct. 2 they finalized a contract to sell the property to an undisclosed buyer.
That statement followed complaints by District 1 City Council member Ken Amaro and District 4 Florida Sen. Clay Yarborough about the deteriorating condition of the mall and the departure of tenants.
Fines and citations
The city provided copies of citations and receipts Oct. 5 for payment for violations since at least August 2021.
The city has been issuing citations for violations of Municipal Code Compliance since at least that time.
“You’ll see through this history that the fines haven’t caused the property owner to make permanent fixes,” said city Chief Communications Officer Phil Perry.
He said that is why the city is seeking repeat violation fines, which would increase the maximum limit of a daily fine from $250 to $500.
Records provided by the city show the mall owner, Regency Mall Realty LLC of Great Neck, New York, has paid fines totaling $3,310 for failure to repair the AC system, failure to restore the ceiling to a sanitary condition, failure to repair holes and cracks in the ceiling, failure to repair or replace the damaged ceiling.
More than a dozen citations, some referring to prior notices, for ordinance violations since Aug. 18, 2021, include:
The ceiling in unsanitary condition; ceiling has holes and cracks; roof leaking; mechanical ventilation system is inoperable or damaged; failure to repair holes and cracks in the ceiling; failure to repair ceiling to a sanitary condition; failure to repair AC system; failure to maintain the roof – leaking throughout; damaged ceiling due to the leak in the roof – throughout; ceiling in unsanitary condition – throughout; exposed electrical wiring; and damaged flooring – throughout.
The citations were issued to Regency Mall Realty LLC, Regency CH LLC and Regency Nassim LLC, the mall’s ownership group.
The ownership group comprises Namdar Realty Group and Mason Asset Management, both in Great Neck.
The parts of the eastern retail wing still open to the public are roped off by security tape around trash containers to collect water from the holes in the ceiling, where water damage has spread.
A Namdar representative said Oct. 2 the owners have finalized a contract to sell the mall to an undisclosed buyer.
Announcement of a pending sale
After two people elected to represent the Arlington area called for owners to fix Regency Square Mall, the real estate company that bought it almost a decade ago announced it will sell the shopping center to an undisclosed buyer.
“The company has recently finalized a contract for the sale of Regency Square Mall. More information will be provided as the buyer’s identity becomes public,” said a statement Oct. 2 from a representative of Namdar Realty Group, which has owned the property for almost a decade.
The representative did not provide more information about the identity or potential use of the mall under new ownership or when the sale will be completed.
Regency Square Mall, at Southside Boulevard, Atlantic Boulevard and the expressway, is a single-story building, except for the department stores, running east to west on the site.
In an Oct. 3 response to a Sept. 8 letter from Yarborough, Namdar COO Dan Dilmanian acknowledged the sale:
“We value your concerns and we are pleased to inform you that we’ve finalized a contract for the sale of the mall,” he wrote.
“The new buyer is aware of the necessary repairs and will liaise with the town soon to address the issues.”
The last time it sold
Property records show Regency Mall Realty LLC owns almost 74 acres and about 980,200 square feet of retail space in the mall. The property is assessed for tax purposes at $6 million.
Regency Mall Realty LLC, a partnership of Mason Asset Management and Namdar Realty Group LLC, paid $13 million for the bulk of the 1.4 million-square-foot mall Feb. 14, 2014.
That purchase included the AMC Theatres property, which Regency Mall Realty then sold a year later, May 22, 2015, to a Kansas City investment group for $26.2 million.
The sale was more than double what Mason and Namdar paid for the entire property, which indicated it made its money back and more on the sale.
Regency Mall Realty made another $7 million on Aug. 31, 2016, when it sold the former Belk department store, in the center of the mall, to Impact Church of Jacksonville Inc., which operates in the space.
‘Posing great health and safety risks’
Namdar’s sale statement came days after Amaro said Sept. 29 that the community “is tired of the mall ownership.”
Amaro was aware of the departure of national retailers, most recently LensCrafters.
He said if owners are not going to be “a productive partner in Arlington, they too should leave.”
Since Mason Asset Management and Namdar Realty bought the mall, tenants have come and gone, mostly the latter, and just one national retailer remains among several local tenants in the east wing of the mall that is open to the public.
Ownership had consolidated retailers into the east wing, now a maze marked by security tape around trash containers to collect water from the holes in the ceiling.
Yarborough’s Sept. 8 letter to ownership asked it to take action to fix “the current state of distress of the Regency Square Mall.”
Yarborough labels his letter to Namdar Realty Group and Mason Asset Management as an “Urgent Appeal for Intervention at Regency Square Mall in Jacksonville, Florida.”
Writing as a local resident and a government official representing the area, “I am compelled to bring to your attention the pressing issues that continue to contribute to the severe deterioration of this once-thriving commercial property,” Yarborough said.
He wrote that Regency Square Mall has faced significant unaddressed challenges for months that cause “immense hardship” for tenants and visitors.
He said one of the most concerning issues is the lack of ventilation and air conditioning, “which has turned the mall into an unbearable environment” whose “stifling heat is negatively impacting employees and driving away would-be customers, resulting in reduced foot traffic and, consequently, the inability for tenants to continue operating their respective businesses in the mall.”
Yarborough cites a property “afflicted with” problems that include structural deterioration with holes in the ceilings, some with exposed electrical wiring that could pose fire hazards.
“The damage has led to ongoing water leaks, which, coupled with the lack of air conditioning, have caused visible mildew and mold growth, posing great health and safety risks to any occupants,” he wrote, providing photos of the damage.
“This can quickly and easily lead to legal liabilities for you as the property owner and manager,” he wrote.
“It is of utmost importance for remedial action to be taken immediately.”
Yarborough, a Republican who represents Duval and Nassau counties, has long served the area that includes Arlington.
He asked Igal Namdar with Namdar Realty Group and Elliot Nassim with Mason Asset Management to visit the mall and assess the situation.
“Please understand that my intention is not to place blame, but to advocate on behalf of the community and businesses,” Yarborough wrote.
“Witnessing firsthand the challenges faced by those operating on your property will undoubtedly amplify the urgent need for corrective measures.”
He said that as concerns about the mall have increased over time, “swift intervention could stabilize the property and hopefully retain current tenants, potentially aid to attract new business and revive the mall’s appeal, and help to rebuild the support of the community.”
Yarborough copied the letter to District 16 Florida Rep. Kiyan Michael, Florida Department of Business & Professional Regulation Secretary Melanie Griffin, Mayor Donna Deegan, District 1 City Council member Ken Amaro and City Municipal Code Compliance Division Chief Thomas Register.
Few tenants remain
Most national retailers have left the mall.
LensCrafters closed recently and Bath & Body Works has remained shuttered, with a sign posted for months that “we are temporarily closed due to the temperature in the mall.”
People at Bath & Body Works were packing up inventory Oct. 4.
The city is reviewing a permit for build-out of a temporary Bath & Body Works store in Southside Commons, north of the mall.
New Jersey-based Jimmy Jazz, which sells lifestyle, streetwear and footwear brands including Nike, Jordan, Adidas, Polo Footwear, Levi’s and Decibel, remains open, although Amaro said he understands it will be leaving.
The few other remaining stores and food-court operators appear to be locally operated.
First Coast Cookies, one of the newest food-court tenants, is closed with a sign that it was remodeling and repairing, directing people to its Facebook and Instagram pages.
Its Facebook page announced the grand opening Sept. 23 of its 4610 San Juan Ave. location in West Jacksonville. It did not update the Regency status.
J.C. Penney was the last department store tenant to leave the mall when it closed in October 2020 after 53 years.
Its sign remains up inside the mall, although that corridor is vacant and roped off.
Mason and Namdar bought much of the shopping center, although two department store spaces are separately owned, including some of the parking lots around them.
Dillard’s owns and operates a clearance center at Regency in a north wing. However, the store is accessible only through one exterior entrance. It is open noon to 7 p.m. Tuesday-Saturday and noon to 6 p.m. Sunday.
Separate owners are trying to sell the closed Sears store at the end of the west wing.
The namdarrealtygroup.com site has been showing Regency Square Mall and a slideshow of retailers that includes Jimmy Jazz as well as tenants that more recently departed — Champs, GameStop and Victoria’s Secret.
The site also features exterior photos of J.C. Penney and of International Decor Outlet, which intended to lease the western retail wing for an outlet center that did not materialize, ended in litigation and is shut off.
From 1967 to now
Regency Square Mall called itself the largest shopping center in the Southeast when it opened in 1967.
The original developer was the Regency Square partnership, led by the Martin E. Stein family of Jacksonville.
It was the area’s first major regional shopping center outside of Downtown when it opened in Arlington, which was one of Jacksonville’s first suburbs.
It was filled with more than 100 department stores, boutiques, specialty retailers and food vendors.
The center doubled in size in 1981-82 and added more space in the early 1990s.
It began showing signs of age and struggling with tenant losses after The Avenues mall opened in 1990 and the area’s population growth shifted to the Southside.
In 1991, Regency Square sold the property to an entity that became controlled by General Growth Properties of Chicago.
The Stein family took shopping mall developer Regency Centers Corp. public in 1993 and that company had no ownership in Regency Square.
General Growth went through Chapter 11 bankruptcy reorganization in 2009 and 2010.
Retailing in Jacksonville shifted for good in 2005 when St. Johns Town Center opened, becoming the regional center of shopping, attracting luxury brands that open just one store in the market and generating extensive retail, housing and entertainment ventures near the property.
By February 2013, General Growth said the mall had been “transferred to the special servicer,” which was trying to renegotiate the loan on the property.
Regency Mall Realty bought the property from General Growth Properties in 2014.
Redevelopment prospects
Redevelopment prospects reared in June 2020 when commercial real estate developer Rimrock Devlin said it had a contract to buy the mall and redevelop the property into mixed uses.
The deal didn’t close.
But the vision showed what could happen with the site.
Jacksonville-based Rimrock Devlin said the property could serve multiple uses.
Those include medical services, limited service hospitality, fulfillment centers, multifamily space, charter schools, banks, a convenience store, restaurants and retail, the developer said in a statement.
At the time, it was still early in the due diligence.
Rimrock Devlin said there are active leases in place, easements and other encumbrances that will “ultimately dictate the potential of a redeveloped property.”
The developer said it looked forward to working with the city and others on the project.
Rimrock Devlin did not say how the property would be repositioned or if parts of the mall would be demolished.
The developer said mall properties throughout the U.S. are experiencing declines in traffic as consumer purchasing habits changed over the past decade.
It said that created redevelopment opportunities because many mall properties are “in the heart of densely populated retail corridors where people live, work and play.”
Rimrock Devlin called the Regency Square Mall site “a perfect representation of this and unique in its positioning within the Jacksonville market.”
“It’s not often that you find a 70-plus acre tract of land in the heart of a community surrounded by rooftops, local businesses and national brands with frontage on a main thoroughfare encompassing over 100,000 passing cars each day,” it said.
Rimrock Devlin said the mall is central in the Jacksonville market because it is a 15-minute drive to Jacksonville International Airport and the Beaches, not far from Downtown and 10 minutes from St. Johns Town Center.
Matt Demir, founder and broker of Xera Realty Inc., was the mall’s leasing agent and broker on the deal.
He said in 2020 that occupancy in the east wing was about 30%, but that included J.C. Penney Co., which was closing.