Courtesy of LoopNetParma, Ohio — Phillips Edison & Co. has become the new owner of Parmatown Mall, one of Northeast Ohio's largest retail properties. The 1.1 million-square-foot complex is located on 83 acres in Parma, approximately eight miles southwest of downtown Cleveland.
The Cincinnati-based shopping center owner did not release terms of the deal. However, local reports indicate that Phillips Edison took possession of the mall through a transaction approved by a Cuyahoga County judge.
The company purchased a delinquent mortgage on the property, which had been in receivership since 2011. The original owners defaulted on the mortgage. Phillips Edison spent several months negotiating with the receiver to finalize the deal. According to The Plain Dealer, the mall's owner, Parmatown One LLC, handed over the property to eliminate the debt.
Separately, Phillips Edison confirmed plans to buy the empty Macy's building at the mall and some affiliated small-shop space and parking. Macy's closed its Parmatown store earlier this year.
"Parmatown represents an ideal opportunity to apply our expertise and revitalize this historic property to its full potential," says Roy Williams, vice president of Phillips Edison's Strategic Investment Fund. "Now that the acquisition process has been concluded, we will focus our efforts on a comprehensive strategy that will rejuvenate this key component of Parma's commercial center.
The sale of the complex included three property components. The first is Parmatown Plaza, an enclosed regional shopping mall anchored by JC Penney, Dick's Sporting Goods and Walmart. The property also includes Parmatown Strip, a neighborhood retail center anchored by Marc's Grocery Store, and Parmatown Medical Center, a four-story medical office building.
The mall was built in 1955, with expansions and renovations in 1985, 2004 and 2005.
Parma Mayor Timothy DeGeeter says he's optimistic about the possibilities for Parmatown, which could help spur economic growth. "From day one, our administration has been committed to doing whatever is possible to aid in the redevelopment of the mall and Day Drive corridor. The bottom line is quality of life for Parma residents," says DeGeeter.
"With the building of a new library under way, and with city and Byers Field nearby, the redevelopment of this area is an important piece of the puzzle for Parma's future," he adds. Byers field is a multi-purpose stadium.
Parmatown is the fourth purchase for Phillips Edison's Strategic Investment Fund II, established in 2011 after Strategic Investment Fund I was fully invested. The private investment funds focus on buying and redeveloping troubled retail real estate.
Phillips Edison owns and manages 225 shopping centers in 25 states.
— Liz Burlingame