The news that Steeplegate Mall was sold for $10.3 million, a fraction of the price tag that it carried in years past, brought a mix of nostalgia and hope to at least one city resident.
“I remember when the mall was filled up – the video-game place, the food – it was packed out,” said Concord native Jon Richardson, who advertises at the mall today. “I would hope that the new owners … they would come up with some sort of idea to increase foot traffic.”
The lower-than-expected sale price to a New York retail-property firm is a sobering number for a property valued at $83 million in 2008. The firm tried to convince Concord assessors three years ago it was worth only $35 million, and which most recently argued that $15 million was its true, taxable value.
It’s unclear what affect this lower price will have on the city’s tax collection.
“It’s too early to tell. That would be something that the assessor would have to determine – was it reflective of the marketplace?”said Carlos Baia, deputy city manager. “There’s no automatic connection between sales price and assessment.”
News began filtering out late last week of the mall’s sale to Namdar Realty Group, based in Great Neck, N.Y. The Namdar group owns a number of regional malls around the country, although none previously in New Hampshire. The company did not respond Monday to a request for comment about its plans.
The $10.3 million purchase was made by sealed bid, said Donald Eaton, managing director of the Manchester office of Colliers International. Colliers managed Steeplegate for a consortium of banks that took over Steepelegate when the previous owners, Rouse Properties, defaulted on their financing.
Because of the sale method, he said, Namdar didn’t specify its future plans.
The sale of the 26-year-old mall comes even as some interesting developments hint that Steeplegate is starting to redefine itself – notably the opening of the Hatbox Theater, perhaps the country’s only live theater operating in an enclosed mall.
“That’s indicative of the industry in general. … They are all going to non-conventional uses in some respects to enhance foot traffic in the mall for other tenants,” said Eaton.
But 480,000-square-foot Steeplegate has a tough row to hoe. As many as one-third of the nation’s malls are said to be distressed, as the whole concept of an enclosed mall anchored by national retailers comes under question due to shoppers shifting to downtowns, stand-alone stores and the internet.
As for Richardson, his hopes for a Steeplegate rebirth aren’t based only on teenage memories. He is a manager at ConvenientMD, which buys advertising banners for its urgent-care facilities that hang in the mall.
This status explains how he learned of the sale: Like other vendors, he got a letter telling him to send checks to a new address.
“It was at a good price, and it still reaches a lot of people, and it reaches a lot of our target demographic of parents,” said Richardson. But he said that having more shoppers to gaze up at the banners would be welcome.
It would be welcome at Tutti-Frutti Frozen Yogurt, too.
“If this new owner is willing to get this place back up and running, we’ll be happy. We’ve been doing very well, but we’ve had a lot of customers compalints that there’s no food court,” said Trisha Barnes-Wilson, manager of the locally owned store, one of few places left to eat in the mall.
Steeplegate Mall’s checkered history dates back to long before it opened, as part of the city’s debate after World War II of how to develop land east of the Merrimack River, especially along Loudon Road.
As told in “Concurrents of Change,” the Concord Historical Society’s history of the city in the 20th century, as early as 1950 “Rick” D’Amante, who owned a lumber business in east Concord, talked about building an enclosed mall on Loudon Road. The plan was tossed around for years as part of debate about zoning the area known as the Heights, and only succeeded partly because huge amounts of dirt became available from the widening of Loudon Road, and was available to level the property where the mall was built.
Steeplegate Mall opened July 25, 1990, and was touted by city officials as a way to prevent retail dollars from flowing south to the Mall of New Hampshire. The Sears on Main Street moved there, and Gov. Judd Gregg showed up for the opening. Mike Eruzione, captain of the “Miracle on Ice” hockey team, was brought in as master of ceremonies.
But from the beginning, there were empty spaces in the mall, and development along Loudon Road didn’t help, since it drew nearby stand-alone stores like Home Depot, Best Buy and Target that competed for customers. Two of the original anchor tenants, Steinbach and Sage-Allen, both closed within the first decade.
The original owners, General Growth Property, spun off Steeplegate in 2001 as part of 30 malls that were described as underperforming. It was bought by Rouse Properties, a real estate trust with a reputation for turning around retail sites.
But problems continued. In 2009, one of the major anchor tenants, Circuit City, went under, and Old Navy shut its store a year ago as the company retrenched. Other mid-level stores such as American Eagle, Aeropostale and Abercrombie & Fitch came and left and the food court all but emptied.
Today, some 17 spots are unused, and although the anchors are active there are hints of problems: Bon-Ton Stores, which has two anchor spots, posted a $57 million loss from its 267 stores in 27 states last year, while Sears is struggling and J.C. Penney almost went under in 2013.
Last summer, with a $47 million balloon payment due in August, Rouse handed the mall over to the consortium of lenders, which at the start of the year put Steeplegate up for sale.
Despite this history, Eaton of Colliers International said Steeplegate Mall has advantages over many other distressed malls around the country.
“The physical plant is in tremendous shape. It has been very well maintained over the years,” he said.
The opening of VI Party Rentals in the former Old Navy, offering bounce houses, laser tag and other entertainment, hinted at a new approach, as did the opening of Hatbox Theater in the former Coldwater Creek clothing store. Whether that will succeed remains to be seen.
“I hope they can do something with it,” said Richardson.
(David Brooks can be reached at 369-3313 or email@example.com or on Twitter @GraniteGeek)Steeplegate Mall Timeline
1950s: As the post-World War II boom starts, debate begins over how to develop east Concord.
1970s-1980s: Loudon Road expanded, zoning changes, development comes to what is called Concord Heights.
1990: Steeplegate Mall opens on formerly undeveloped land. Anchor stores are Sears, J.C. Penny, Steinbech and Sage-Allen, which closed two years later.
1999:Bon-Ton Stores and Circuit City replace recently shut Steinbech.
2001: General Growth Property sells Steeplegate as part of 30 underperforming malls to Rouse Properties, which specializes in malls and retail development.
2009: State Supreme Court sides with Concord in battle over mall’s assessed value that dates back to 2004, but disputes continue.
2009: Circuit City shuts.
2014-2015: Several store close, including anchor Old Navy, which opened in 2001. It is replaced by a part rental store that offers bounce houses and other in-store entertainment.
2015: Rouse defaults on its bond payments and a consortium of lenders takes over the mall.
2016: Hatbox Theater opens in former women’s clothing store; it is perhaps the only live theater in an enclosed mall in the country.
May 2016: Mall sold to Namdar Realty Group of Great Neck, N.Y., owner of many regional enclosed malls.
(David Brooks can be reached at 369-3313 or firstname.lastname@example.org or on Twitter @GraniteGeek)