Real Estate and Retail

Shopping center negotiates sale

April 17, 2014
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Five Below opens two more West Michigan stores
Five Below, a chain that operates a store at Centerpointe Mall, sells “trend-right” merchandise designed for teens and pre-teens, priced at $5 and below. Courtesy Five Below

A landmark shopping center at a major intersection could be trading hands for the first time in more than a decade.

On the table

The 525,000-square-foot Centerpointe Mall in Grand Rapids was put up for sale by its owner, Lormax Stern Development Company, in December, said Chris Brochert, co-founder of the Bloomfield Hills-based company that purchased the mall back in 2000.

The center is home to about 36 stores and has about 50,000 square feet of available space on its property, at 3665 28th St. SE, according to center representatives.

“It’s public knowledge that we had a sales package that went out last December,” Brochert said. “We have picked a potential purchaser . . . a strong national company. They haven’t gone hard on the deal yet, but they still have due diligence.”

The prospective buyer will make a decision in the next 30 days.

Terms of the proposed deal were not disclosed.

If the deal isn’t done, Lormax Stern Development will continue to run the center as is, Brochert said.

The company isn’t interested in selling the center to anyone else right now.

“Because it’s fully stabilized right now, what we’ll do is keep it, maintain it and as tenants come due, we’ll release those spaces, make them new build outs and keep moving them forward like we do,” Brochert said.

De-malled property

The Centerpointe Mall is a good property to sell, since it underwent a $30-million redevelopment and de-malling process, which occurred from 2012-2013, said Earl Clements, a principal at Colliers International West Michigan.

Clements called Centerpointe Mall a “well-positioned and attractive mall.”

“It’s a fabulous location,” Clements said. “It’s at the retail intersection of West Michigan. It’s now been completely re-done, so it’s as nice and new as it can be. It’s got some great national and regional tenants, with very good rents.”

The de-malling involved “eliminating all interior common area space and scaling down the available leasable square footage by about 200,000 feet,” according to a report by Lormax Stern Development.

Clements said the property needed to be de-malled 15 years ago, but the owners weren’t able to and over time the mall suffered.

As a mall, it didn’t have national anchors such as Sears, JCPenny or Macy’s and was considered a second-tier property.

The de-malling process changed everything and made the mall worth a lot more money, Clements said.

“By de-malling it, it’s turned it into a power center,” Clements said. “They gave exposure to the street for all those national tenants that were not in the market or not visible from the street — and these guys did it. They did a great job.”

Good sign

The story of Centerpointe Mall’s redevelopment is a sign of good retail growth in West Michigan, and there’s more to come, Clements said.

Steady and generous family money re-invested into the community is what's making the difference, and it’s paying off, he said.

“We in West Michigan have a lot of things happening, but, certainly, retail has a lot of things happening,” Clements said. “We’re becoming more of a mecca that people want to shop, work and stay in. We all win on that.”

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