This article in the New York Times discussing the decline of Owings Mills Mall in suburban Baltimore County is the latest of many articles ruefully documenting the scores of shopping malls that have shuttered across the country over the last 10-15 years. The article identifies many of the forces contributing to the increase of so-called “dead malls,” but only briefly touches on the critical choices shopping mall owners face as they must decide whether to refurbish the mall, continue operating a declining asset, or consider a more dramatic reinvention to restore the property’s value. Not mentioned in the article at all are the choices faced by lenders with distressed mortgages for these properties.
Developers and lenders attempting to resurrect a shopping mall back from the dead should be weary of the myriad legal issues unique to these projects, e.g., existing zoning classifications may not permit mixed-use redevelopment, radical redevelopment of malls encumbered by securitized loans may require consent from a loan servicer, co-tenancy obligations for in-line retailers may be triggered by the departure of an anchor store, and the amount and location of parking areas may be restricted by easement agreement and the zoning code.
Attorneys with Rosenberg Martin Greenberg, LLP have experience navigating these unique issues and have worked on all phases of redevelopment projects, including the mixed-use redevelopment of a shopping mall in the Baltimore area.