A New York-based venture of Mason Asset Management Inc. and Namdar Realty Group LLC bought Regency Square Mall for $13 million, about a third of its taxable value.
The deed was signed Friday and recorded this morning with the Duval County Clerk of Court.
Mason and Namdar are based in Great Neck, N.Y., and invest in aging shopping centers that have suffered declines in occupancy and prestige.
Documents show the group bought parcels at the 9501 Arlington Expressway mall that were valued at more than $30 million for tax purposes in 2013, although the buyers have not commented on specifics of the deal.
Regency Mall Realty LLC, Regency CH LLC and Regency Nassim LLC, partnerships formed by the venture, bought the properties from GGP Regency Square LLC.
Sears and Dillard’s own their stores. Deed documents with the sale referred to the tax parcel for the Dillard’s store, but a spokeswoman said the company still owns it and is operating it as a clearance center for the foreseeable future.
Sears issued a statement last week that an expected Regency Square sale “has no impact on Sears. We continue to serve our members and customers at Regency Square, and remain committed to the Jacksonville community.”
“I’m glad there was an interested buyer,” City Council member Clay Yarborough said this morning. He represents District 1, which includes Regency.
Yarborough said he would ask to meet with the new owners to learn their plans. He said he didn’t know their intentions, but said that if part of the 1.4 million-square-foot mall were designated for other compatible uses, such as offices or medical or educational purposes, “I don’t sense any opposition from the community.”
Retail executive Geneva Henderson with Lat Purser & Associates said she had heard the mall sold for “pennies on the dollar.”
“I would anticipate their plans must be for a redevelopment. Jacksonville and Regency will be very fortunate if that happens,” she said.
The 47-year-old Regency Square has anchored the Arlington area for almost half a century.
RS Properties Inc., in care of Chicago-based General Growth Properties Inc., owned the property. General Growth Properties had turned the struggling center over to a special servicer. RS Properties bought the mall in 1991.
Regency Square opened in 1967 as the area’s first major regional shopping area outside of Downtown and in Arlington, considered Jacksonville’s first suburb.
The center doubled in size in 1981-82 and added more space in the early 1990s. However, the mall’s retail occupancy dwindled to about 38 percent by the end of 2013 in the wake of changing demographics, at least three newer shopping centers built in Southside and North Jacksonville and several recessions.
Yet Regency continues to command a high-profile area of Arlington just off of the Southside Connector and not far from the Interstate 295 East Beltway. The mall takes up about 110 acres.
Mason and Namdar have a history in redeveloping aging malls. Namdar President Igal Namdar has declined to discuss plans for Regency, referring questions to Mason Asset President Elliot Nassim, who also declined to comment on plans until a sale was completed. Nassim was unavailable for comment early this morning.
The mall is anchored by JCPenney and Sears, as well as a Dillard’s clearance center and a Belk store, although a new Belk is being developed 3.3 miles east at Atlantic and Kernan boulevards.
The mall is most heavily occupied from the Belk store east to JCPenney, while the area from Belk west to Sears is largely vacant.
Regency Mall tenants were notified in December of a possible sale.
In its recent year-end financial report, General Growth Properties reported that occupancy at Regency Square dropped to 37.9 percent from 43.8 percent at the end of the third quarter and 60.1 percent at the end of 2012.
General Growth continued to say that Regency Square has been “transferred to the special servicer,” which has been handling the property, without giving more details. The mall has not been listed on the GGP.com website for some time.
Namdar Realty Group is a privately held commercial real estate investment and management firm that says on its namdarrealtygroup.com that it owns more than 5 million square feet of commercial real estate in the United States and continues “to grow at an unprecedented pace.”
It says the company’s portfolio includes a number of retail strip centers and medical and-or office buildings.
The Namdar portfolio listed online shows at least 50 properties in 13 states.
Curiosity about potential tenants for Regency could be addressed by the tenants Namdar has signed for other properties.
Namdar listed on its website the names of more than 40 companies as prominent tenants in its properties, including JCPenney, Sears, Fashion Bug, Hibbett Sports, Hallmark, Family Dollar RadioShack, The Shoe Show, Sally Beauty, AT&T and Verizon.
Regency’s purchase would not be Namdar’s first in Jacksonville. It bought the Jacksonville Regional Shopping Center at 3000 Dunn Ave. for $6.8 million last year. That 220,000-square-foot center is anchored by Winn-Dixie and JCPenney.
Namdar and Mason also bought the DeSoto Square Mall in Manatee County in late 2012, and its issues were described similarly to Regency’s. It embarked on a facelift, security improvements and more community involvement.