WASHINGTON COUNTY, Md. — Scroll too fast and you’ll miss it on the new Valley Mall brochure: Belk.
Belk’s name is tucked away on the second page of the new Valley Mall leasing brochure on the website of the mall’s owner, Pennsylvania Real Estate Investment Trust. Thanks to a reader for alerting me to the change.
The brochure simply says “Opening 2018.” Belk’s logo isn’t on the brochure, but it’s likely it could go in the former Macy’s space, but it’s still very possible it could go to Sears.
The smallest Belk is around 100,000 square feet. The shuttered Macy’s was around 120,000 square feet. Sears is 123,400 square feet. Last year, a leasing brochure showed that about half the space, or 52,325 square feet, would be available for lease.
The Washington County Board of Elections wants 20,000 square feet carved out of Macy’s for office space, leaving 100,000 square feet for Belk if the department store wants to open there. That seems easy enough. Good luck figuring out how to carve that space out if that happens.
Also, it is a coincidence that PREIT purchased the Macy’s space in April and now this brochure shows up a month later? Not really. In between, the International Council of Shopping Centers Retail Real Estate Convention (ReCon) was held in Las Vegas where stores, real estate developers and mall owners tried to make some deals.
Plenty of intrigue remains.
That brochure detailing that a store could lease half of Sears has disappeared from KLNB Retail’s website. However, Seritage’s quarterly reports show it still has rights to recapture half, but has not announced any plans for that space. The initial reports was that Sears wanted to test a smaller format. We haven’t seen that happen yet in Hagerstown.
Nothing has been filed under land records showing a sell or otherwise for Seritage in Hagerstown since it bought the Sears building.
Earlier this year, PREIT announced it would recapture three Sears locations and simultaneously announced retailers to replace those spaces. Hagerstown wasn’t one of those. Likely, because that Sears is not owned by PREIT. It’s owned by Seritage, who is leasing space back to Sears. That’s the company who found and brought BJ’s Brewhouse to the former Sears Auto Center. Seritage’s latest filing shows that BJ’s should be coming in the fourth quarter of this year.
The Baltimore Sun reported on April 1 that there wasn’t any new information on the Hagerstown Sears space. (However, that report overlooked the company’s quarterly report that showed the Cockeysville Sears will be partially replaced by a HomeGoods plus junior tenants and restaurants with most work done by the second quarter of 2018. The Bowie Sears Auto Center will also get a BJ’s Brewhouse.)
Here’s another issue for Belk: TownMall in Westminster. Belk only has two Maryland stores—the other in California, Md. TownMall was put into receivership, according to the Carroll County Times. That means a bank is in control of the mall, not a professional mall management company like PREIT, Simon, Westfield or Taubman. The court-appointed receiver, The Woodmont Co., is there to just keep things going until everything is settled. Woodmont’s website says it’s a receiver for 23 properties.
I’ve seen the after effects of malls placed in receivership and it’s not pretty. Some anchors and tenants have out clauses that can allow them to leave penalty free if certain actions happen (receivership, loss of X number of other anchors or if leasing falls below a certain percentage). Still, a store could close regardless of any penalty. If receivership drags on, I wouldn’t be surprised if Belk decides to close in Westminster if sales decline from a drop in foot traffic at the mall if other stores leave.
In fairness, while a store like Dillard’s left DeSoto Square mall in Bradenton, Fla., Sears, J.C. Penney and Macy’s stayed on through ownership changes and when the mall lost several national retailers. Macy’s would later close because a new store opened at The Mall at University Town Center. Closer to home, it’s a similar story at the Chambersburg Mall in Pennsylvania where certain anchors are able to hold on while the rest of the mall looks ghostly.
A Belk spokesman told the CCT on Thursday they’re not looking to leave Westminster:
Belk, another large department store that anchors TownMall, is similarly well situated, according to Andy Izquierdo, vice president of communications and community relations for Belk Inc.
“The Belk store in the TownMall of Westminster is doing well, so it is business as usual,” he said. “We have no plans to exit the Westminster market.”
No retailer or spokesman will say anything that could hurt sales and nobody announces closures until they actually close or legally have to announce a layoff. Still, I’d have to believe that store should do well regardless of what happens with the in-line tenants.
No building permits are on record for the Hagerstown Belk, yet. Stay tuned.
— Charles Schelle
This post has been updated.