Ellington

Watkins Development LLC Vice President Jason Goree said the company, which already owns a closed anchor-store space in Metrocenter Mall, now wants to buy the entire structure. 


Watkins and the city of Jackson, which bought a different abandoned anchor store in the same mall last year, would prefer not to let the building complete foreclosure, even if it presented the possibility of buying the whole mall at a fire sale price.

"It's potentially cheaper to buy it from foreclosure, but that potentially opens the market to every buyer," Goree said. "If we felt the mall was going into foreclosure, we'd probably try to get it before it does, but we're in constant communication with the owners of the mall and the banks, and we're going to try to figure out what's best for us and the city."

Metrocenter business owner David Neeley is looking forward to Metrocenter coming under new ownership next year.

"I think anything that will bring more people in will be great, and (developer David Watkins) may have some better ideas," said Neeley, president and owner of The Cookie Store, which has had space in the mall's upper floor for about 30 years.

"This is the only store in the franchise I own that isn't making good money," said Neeley, who works the store himself most weekdays to keep costs down. "Low business has everything to do with the amount of people who come through the mall. We need more people here."

Revenues at Metrocenter have been bleeding off for the last several decades as affluent Jacksonians and shoppers moved to the suburbs. Goree said that the mall's current owner, Metrocenter Mall Ltd., is behind in its payments to Los Angeles' First Credit Bank, adding that Hinds County Chancery Court had begun a foreclosure on the property this month, but said he expected Metrocenter to catch up on payments before the foreclosure proceeded further.

Goree added that Watkins, who facilitated the recent renovation of the King Edward Hotel in downtown Jackson, did not want the building to go into foreclosure "because of the negative connotations" it brings upon the area and the city. "If we have to buy it at a higher price to stop the perception of it going bad, then we'd rather do that. We're willing to pay a little higher price to stop the mall from looking even more negative," Goree said.

Watkins Development LLC intends to have site control of the entire structure within the next 12 months, meaning it could be making payments to the bank if the current owner defaults. Complete ownership, Goree said, is more complicated and will require "baby steps," but he added that site control will allow the company to move forward with development plans for the mall.

There's nothing simple about those development plans, however.

Watkins wants to rent a portion of Metrocenter Mall to the Jackson Public Schools district as part of a "Metro Master Plan" that could include an arts plaza and performance space for the district and a complete renovation of the mall.

The three- to seven-year plan includes development of housing around the mall, a hotel and entertainment venues. Watkins said he would charge JPS $1 million a year for leasing and renovations, but said the district stands to make about $500,000 in new revenue if it moves its administration into the mall. The estimate comes from projected sales tax increases and savings from maintenance of the district's current, aging buildings.

"We've worked with the (Jackson Public Schools) staff, and we've gotten numbers from the staff ... to justify the cost savings," Watkins said in August.

"According to our calculations, the school district will save $198,634 a year on utilities, $325,000 on staffing annual savings, $462,386 on new taxes, just from (the development of the) Metrocenter, and save $224,400 on maintenance and insurance overhead, (and) janitorial services for a total of $1.2 million in savings. And that's just what we've identified with our meager resources."

JPS Superintendent Lonnie Edwards originally approached the JPS board with the proposition in July, but has never officially put the proposal before the school board for approval or disapproval.

JPS board member George Schimmel said he is not sure about Watkins' estimated savings.

"I do not know for certain what those figures demonstrated," Schimmel said.

"If you make any projection of a future cost, it's based upon assumptions like how much efficiency, maybe derived from a more compact layout of a central office, and other things. There are always assumptions.

He continued: "Depending upon how you tilt those assumptions, you can tilt projections one way or another. I couldn't' get any (numbers from Watkins) that I could feel sufficiently certain about."

Schimmel said some board members are worried about where the district would get the money for up-front moving costs and how quickly it could eliminate the financial drag of its existing office space downtown.

"We're not likely to sell the space that we (would) vacate right away," he said. "That would require some maintenance cost until we manage to sell it."

Goree said Watkins would continue to try to work with the board. In the meantime, however, business owners with leases inside the mall will not be affected, regardless of who the owners are, he said.

"Our sources told us that if the mall goes into foreclosure, the businesses inside it will continue, and if we own the building we certainly don't plan on kicking anybody out," Goree said. "We would try to work with those guys, because the worst thing we could do is disrupt something that's working. The things that are working--let them work."

Previous Comments

ID

161232

Comment

Wasn't David working on getting ownership of the mall? Once I heard that Metrocenter was in foreclosure, I immediately thought of David taking over. It would be terrific to see him have ownership because when David takes on something, it will get done.

Author

golden eagle

Date

2010-12-08T15:07:52-06:00