Leasing agent Zachary Schunn describes the latest plan to revive Forest Fair Village
A fitness center operator who brought her company headquarters to Forest Fair Village in February is now looking to double her space at the region's largest mall.
It could be the first step toward a new mixed-use strategy to revive the 1.5 million-square-foot center, which has operated in the past as Forest Fair Mall, Cincinnati Mall and Cincinnati Mills.
Now 26 years old and 70 percent vacant, the massive retail complex straddling the border of Forest Park and Fairfield is trying to fill its acres of empty space. It calls itself The Forest Fair Village and includes shopping, dining, entertainment and recreation.
WCPO Insiders can learn more about the redevelopment plans and what obstacles stand in the way.
CINCINNATI -- April 2014 -- The Forest Fair Mall, one of the region's largest, is having trouble retaining leases.
Fitness entrepreneur Angie Demers is expanding at Forest Fair Village
CINCINNATI - A fitness center operator who brought her company headquarters to Forest Fair Village in February is now looking to double her space at the region’s largest mall. It could be the first step toward a new mixed-use strategy to revive the 1.5 million-square-foot center, which has operated in the past as Forest Fair Mall, Cincinnati Mall and Cincinnati Mills.
Now 26 years old and 70 percent vacant, the massive retail complex straddling the border of Forest Park and Fairfield is trying to fill acres of empty space. Forest Fair Village has a new leasing team that is working to build a tenant base of shopping, dining, entertainment and recreation attractions.
"People have been anxious for things to come to life here. They’ve been very supportive,” said Angelina Demers, owner of Bee Fit Health Club and Bee Active Gym Adventure Zone . Bee Active closed its Bright, Ind. location in January and now calls Forest Fair its “national headquarters.”
Demers said her two businesses already occupy 35,000 square feet near Kohl's department store. Now, she’s in negotiations to add 33,000 square feet for a training center specializing in gymnastics and competitive cheerleading.
“It would allow us to have gymnastics on one side and fitness on the other with pits and trampolines and bringing an all-star competitive cheer team to Bee Active,” Demers said. “We haven’t done that so far. We’ve only had gymnastics. So, cheer will be an exciting addition.”
And that could just be the start. The brokerage team hired recently to lease the property said it is close to bringing a sports complex to the mall’s long-empty Bigg’s hypermarket space. A similar deal with a different ownership group was announced in 2011 but didn’t pan out.
“Our vision for it really is to create what we’re going to call a work-play environment,” said Dave Mussari, managing broker for Prudential Commercial Real Estate in West Chester. “We see more of those type of specialty users driving to the mall as well as some traditional retailers. There’s a food court. There are several restaurants there that we see being revitalized. And then we do see sections of the mall turning into office users and other specialty users that aren’t traditional retailers.”
It’s the latest in a string of new starts for a retail property with a complicated history, starting with the 1989 bankruptcy of its Australian developer, L.J. Hooker, one year after opening. After finding brief success with a discount-retail format in the 1990s, the mall hit another downward slide in the 2000s, ultimately selling at a steep discount in 2010.
An investment affiliate of World Properties Inc. in Floral Park, NY paid $4.7 million for the property, according to Hamilton County records, well short of its $52.6 million sale price in 2002. Hamilton County’s Auditor now values the property at $7.15 million.
Records show the new owners have a tax delinquency of $2.2 million. They’re on a payment plan to address those past-due payments. The county received $551,600 for delinquent payments in January.
Bass Pro Shops dealt the mall another blow in December when it announced plans to build a new store in West Chester and vacate the Forest Fair location by 2015.
“We think the property has a great deal of value,” said Paul Brehm, economic development director for the city of Forest Park. “We’re certainly open to ideas to redevelop the facility.”
The mall competes in the west central segment of the local real estate market where retail vacancy rates are 11.9 percent, the highest in the city and well above the regional average of 8.4 percent, according to the real estate research firm, Xceligent Inc.
Making matters worse, there are a half-dozen neighborhood and community centers in close to Forest Fair, all hungry for tenants.
"These six properties, most likely to compete with Forest Fair, total 1.9 million square feet, with 412,610 square feet currently vacant. Nearly 22 percent vacant," said Loren DeFilippo, senior regional director of analytics for Xceligent. The properties also have "another 215,000 square feet of space that may come on the market" in the next year.
Brehm was encouraged that World Properties hired a professional leasing team to recruit new tenants. But he’d like to see more details about redevelopment plans than owners and brokers have shared to date.
“We heard rumors that there might be some other parties coming into the picture,” Brehm said. That’s a move the city would welcome because it could bring additional resources to the mix.
“What we really need to see is kind of a comprehensive redevelopment plan,” he said.
Calls to World Properties and the mall’s new general manager were not returned.
Mussari said the latest redevelopment plan has its roots in a sales pitch
he made to its New York owners three years ago.
“At the time they weren’t necessarily ready to do what we had suggested they do to reposition the mall,” Mussari said. “They thought it could be revitalized with traditional retailers. They came back to us about three or four months ago and said, ‘Listen, we think you guys were right three years ago. We’d like to try your approach.’”
Mussari is a real estate veteran who started his career as an asset manager for Sears in the early 1990s and previously served as managing partner at Landmark Midwest Properties . He’s been a Prudential broker since 2006 and in January joined Berkshire Hathaway HomeServices Professional Realty as managing partner. Prudential’s commercial listings tend to be smaller properties seeking lease rates of $7 to $15 per square foot.
Mussari said it's a bigger project than he's ever undertaken but there is enough interest to give him confidence in the mall's future.
"We plan on doing quite a bit of leasing here in the second quarter," he said. "We will be seeing new tenants in that center very shortly ... A large sports user would be a bit of a game changer, somebody who could utilize a large amount of the space, drive traffic to the space."
That can't happen fast enough for Demers, whose fitness business benefits from traffic generated by the nearby Kohl's department store.
"It's working so far,'' she said. "We just want more people."