Wednesday, October 31, 2012

Majority of Hickory Hollow Mall sold for $1M; owner discusses future

http://www.bizjournals.com/nashville/news/2012/10/31/hickory-hollow-mall-sold-for-1-million.html


Majority of Hickory Hollow Mall sold for $1M; owner discusses future

Date: Wednesday, October 31, 2012, 12:19pm CDT - Last Modified: Wednesday, October 31, 2012, 2:41pm CDT
Rajesh Aggarwal never imagined he would own a mall. He's still not sure if he's made the right decision in buying a huge chunk of the largely vacant Hickory Hollow Mall for $1 million.
Aggarwal approached Chattanooga-based CBL & Associates Properties Inc. (NYSE: CBL) about buying a small 5,000-square-foot space in the struggling mall for his wife, a physician, to open a clinic.
"(CBL) said, 'You can have the whole mall for the same price,' " said Aggarwal, who owns a Comfort Inn on Demonbreun Street and an apartment complex in Murfreesboro.
As of this week, he's now the owner of a 617,000-square-foot portion of the mall, sitting on more than 27 acres. More than 428,000 square feet is leasable space, including the portion occupied by Electronic Express. The deal didn't include the mall's anchor store portions.
While it may seem like a steal for a mall that sold for $126 million in 1998, Aggarwal said he's keenly aware it could turn into a money pit.
"If someone wants to give you an elephant for free, would you take it?" he said. "The maintenance costs will eat you alive. We will have to work very hard to get the mall going, or it will continue to incur a lot of expenses without generating income."
Aggarwal expects to invest an additional million-plus dollars into the property, which he says is in "good shape." He plans to enlist a property manager and real estate broker to market the property.
"We will see if I made the right move," he said. "Time will tell."
In June, CBL asked all but about a dozen of the mall's tenants to leave. Hickory Hollow Mall has been struggling for years. This year both Macy's and Sears closed their doors, leaving the mall without a department store.
Nashville State Community College opened a satellite location in the mall in August, in the former Dillard's space. Metro also has plans for a community center and various green space, and officials have said the struggling retail center needs a range of uses for a proper jump-start.
Nevin Batiwalla covers real estate/development and regional economic development.

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