Despite its foreclosure proceeding, The Shops at Atlas Park are up and running, and “will move forward,” according to Paul Millus, a receiver appointed by the courts.
The Shops, previously managed by Damon Hemmerdinger and Atco Properties, but now by Michael Mattone, and owned by French banks Calyon and Société Générale, entered into foreclosure in January or February of this year.
Jim Galvin, a spokesperson for Société Générale, declined comment to The Queens Courier.
Millus was named in March, at which point, he said, the mall was at about 60 percent occupancy.
“When we started this process, we had to address operations,” said Millus.
It was at that point, said lawyer Boris Sorin, that his 16 clients – all tenants of The Shops, including Cold Stone Creamery, Simply Fondue, Manor Oktoberfest, Art World framers, Dance & Beyond, Ibiza Sun Club, My Heavenly Scent, Rosetta Wines, Frankie’s Playce, Crazy for Animals and boutiques Dresses & Denim, Femme1231, M12ThirtyOne and Stella Gialla – began withholding rent.
“For all we knew, the banks would say ‘We’re closing shop.’ We would never have gotten that money back,” said Sorin, who alleges that his clients only received notices of default last week. “They [the lessees] are not looking for a bargain, to benefit from the foreclosure, they are looking to survive.”
Mattone told The Courier that many of the tenants have, in fact, not paid rent since early in the year, and that they have tried to help with negotiations, as they are reluctant to evict.
But, he added, “You can only cut to the bone so far, then there is no more room.”
The money in arrears is “a significant amount, but won’t break the bank,” according too Millus.
He said that lease modifications have been negotiated for certain tenants, such as Borders and Jos. A. Bank, but that “some of the proposals [for other tenants] were just not acceptable to the bank,” with whom the final say rests.
“The bank is strong in its position that we have costs,” he added, “such as common area maintenance, etc.”
“We thought we were working together to come to a resolution,” said Sorin, who alleges that if the negotiations for his clients had been accepted by the bank, “most would have survived,” though he did concede that “more tenants are doing fine than are not doing fine.”
As for Sorin’s allegations that rents at The Shops are too high, Millus told The Courier, “If we allow everyone to renegotiate, we’d be out of business. We are willing to – and have – negotiated on a case-by-case basis. We are going to settle [with some tenants], others will go by the wayside. We have not taken a hard-line position.”
“[We] thank our customers and associates who have been with us since we opened in 2006,” said Monty Bibb, Stein Mart District Director, who said that the store will be leaving The Shops next spring.
Both parties do agree that The Shops – much like other malls and retailers – are “hindered by the economy,” though Millus said they are “willing to adjust.”
“Obviously the mall has not gotten the foot traffic we expected, coupled with the economy,” said Sorin. “We are not profiting from [the situation]. It’s a very difficult situation. They [the tenants] have invested so much of their life savings in this, they can’t just pick up and leave.”
The parties also agree that new lessees are needed.
“We need the bank to bring in more tenants,” said Sorin (reportedly, the bank okays leases that are longer than one year). “As tenants in the mall increase, we will adjust accordingly.”
According to Mattone, a broker’s breakfast was held recently to lease the empty stores.
“The best of the malls are struggling because consumers have pulled back, but at the end of the day good businesses will survive,” he said.
Millus told The Courier that they are in the process of signing a lease with Havana Bistro for the “Orange Space” in the mall.
“That’s a great addition and we’re happy to have them aboard,” he said, adding that vacated stores, such as Amish Market, will be put “in the hands of a different tenant.”
Additionally, he said, they also signed an expansion of office space for CitySpec.
Calling the foreclosure proceedings “a changing of the guard,” Millus said a probable timeframe would be November or December of this year, but, he said, “At the end of the day, it [the mall] is going to be operating regardless of foreclosure. We are operating with very successful stores – we will move forward.”
Some stores that are
Staying: Leaving/gone:
Regal Cinemas Stein Mart
Shiro of Japan Bombay Company
Manor Oktoberfest Blue Tulip
New York Sports Club Amish Market
Crazy for Animals
(as of press time)
