News Column

Chapel Hill Mall in foreclosure; receiver is named to manage the property

July 17, 2014

By Betty Lin-Fisher, The Akron Beacon Journal



July 17--Akron's 47-year-old Chapel Hill Mall is in foreclosure due to nonpayment on its loan, and new management has been appointed by a Summit County judge.

Foreclosure proceedings began June 19 against the mall's owner, CBL & Associates Properties Inc. of Chattanooga, Tenn., by lender U.S. Bank National Association for nonpayment on its $77 million loan.

CBL purchased the property from the developers and longtime owners, Richard Buchholzer and Forest City Enterprises, in 2004.

Chapel Hill remains open for business, unlike Rolling Acres, which also is in foreclosure. Summit County is foreclosing on the owners of Rolling Acres, and the west-side property is scheduled to go to sheriff's sale in October. More than $1.3 million is owed in back taxes and liens.

Last week, Summit County Common Pleas Judge Lynne Callahan ordered an employee of McKinley Inc., an Ann Arbor, Mich.-based company that owns downtown Akron's FirstEnergy tower and Orangerie Mall, as the receiver for Chapel Hill.

McKinley Inc. both operates its own commercial properties, such as the FirstEnergy tower and also serves as a receiver for malls in court proceedings, Matt Mason, senior vice president and managing director, said in a phone interview. McKinley has four malls in receivership and seven malls under management, according to a news release.

Mason said as an arm of the court, it's the receiver's job to "manage the mall and try to reposition it to create as much value for the parties."

James Botti, attorney for U.S. Bank National Association, said he could not comment on the case. Dan Summerlin, CBL director of corporate relations, said the company had no comment.

For mall store owners and shoppers, the appointment of a new manager is good news, as they hope that McKinley will help bring new life to the mall.

Stephanie Irrcher of Tallmadge and her daughter, Christina Brezezinski, said Chapel Hill Mall has been declining for several years. Irrcher said she likes to come to walk during the day because it's close to her house, but "if we're going to do some serious shopping, we go to Summit Mall." Irrcher said she also wouldn't feel safe going to the mall at night and comes only in the mornings.

Sean Nazir, manager of New York Fashion, a menswear shop that has been in the mall for about two years, also said the mall has been in decline.

"We need more tenants and more crowds," he said.

Nazir said CBL did no advertising and he'd like to see entertainment and events, which would bring crowds and shoppers.

He sees the receiver as good news.

"They said we'll see big improvements and that's what we want," he said.

On the other side of the mall toward Macy's, Amanda Lewis, a clerk at Gio, a gift shop that sells swords, knives and collectibles, said the mall needs more shoppers.

"Traffic wise, we are dead on this end of the mall," she said.

The owner of Gio, Kyu Lee, said she's only been in the mall for about a month and a half, so she doesn't know whether having new management will be good or bad.

But Lee, who has two vacant stores next to her, is all for more customers.

City, county aren't alerted

The foreclosure proceedings were news to Akron city and Summit County officials. The county is named in the suit. Akron city spokeswoman Stephanie York said city officials did not know of the foreclosure until told by a reporter and was unable to get comment from the appropriate officials in time for deadline.

Jack LaMonica, chief of staff for Summit County Fiscal Officer Kristen Scalise, said the office knew a foreclosure was coming, but did not know the suit had been filed. LaMonica said Chapel Hill Mall is up to date on its property taxes, including taxes that are due Friday.

LaMonica said the county is a party to the suit, but is not required to answer the suit.

Chapel Hill, which opened in 1967, was to be the first enclosed shopping mall in the region, but delays gave Summit Mall that title. Summit Mall opened in 1966; it was built by Edward J. DeBartolo, the now deceased shopping mall pioneer from Youngstown.

Richard Buchholzer, now deceased, and Cleveland's Forest City Enterprises joined forces to build Chapel Hill on land once owned by Buchholzer's father, J.J. Buchholzer. The elder Buchholzer had become an owner of the old Hower's Department Store in Akron, buying it out of receivership in the Great Depression.

Richard Buchholzer also was instrumental in the building of the now defunct Rolling Acres Mall, also teaming up with Forest City for the project. Rolling Acres opened in 1975.

Staff writer Katie Byard contributed to this report. Betty Lin-Fisher can be reached at 330-996-3724 or blinfisher@thebeaconjournal.com. Follow her @blinfisherABJ on Twitter or www.facebook.com/BettyLinFisherABJ and see all her stories at www.ohio.com/betty.

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(c)2014 the Akron Beacon Journal (Akron, Ohio)

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Source: Akron Beacon Journal (OH)


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