Fiesta Mall Here in Mesa Still Begging For "The Right Deal'

Attempts for years to revive the dead mall - where Mesa Mayor John Giles says "Location, location, location is everything" as if this practicing personal injury-accident law attorney knows anything about real estate - have floundered to say the least like most of the highlights of his NextMesa campaign that propelled into office: figments of his imagination,  if he ever had one like comparing the City of Mesa to Mayberry, the fictional television show from years gone by.

An article from Bloomberg News today might give the mayor and the bright minds in the Office of Economic Development inside City Hall some clues:

How to Save a Dying Mall

A small group of investors is buying struggling shopping centers on the cheap and trying to turn them around.                

By Patrick Clark ‎22‎ ‎February‎, ‎2017‎ ‎7‎:‎10‎ ‎AM         

@pat_clarkMore stories by Patrick Clark

Here are some extracted tidbits from Bloomberg News' article today :

Hull Property Group, which owns 29 shopping malls, sticks to a proven script that includes negotiating tax incentives with local governments, demolishing excess space, and reversing public perceptions that the property is struggling.

Hull is one of a small crowd of operators bucking the conventional wisdom that there are simply too many malls and that only those catering to wealthy shoppers will survive the death of legacy retailers. While operating strategies vary, most are shopping for older malls in places with no other enclosed shopping center within 50 to 100 miles. 
Such older properties have some inherent advantages. Many were built as the surrounding community was sprouting, so the original developers had their pick of the best locations. Despite the rise of e-commerce, people still come to malls to participate in the social aspect of shopping—especially in suburban or exurban places with few large gathering places. 

Some malls struggle because they simply can’t access credit, said George Good, executive vice president in CBRE Group's National Retail Investment Group. As department stores close and large mall operators retrench around their best assets, many lenders have decided to stop financing lower-quality properties. In many cases, owners that can’t get a new loan will look to sell at a discount, or let the mall go into foreclosure.

Not every struggling mall is a good candidate for a refresh.

In bigger markets with stiffer retail competition, developers have considered more radical strategies for failed malls, such as turning them into office buildings, medical centers, and hotels with mixed results.

Still, the vicious nature of the retail business makes plenty of opportunities for investors.“We think there are somewhere between 100 and 200 malls out there that fit the general criteria” for a rehab, said Chris Maguire, chief executive officer at Cypress Equities, a Dallas-based investor that bought a 40-year-old regional mall in Flagstaff, Ariz., earlier this year. “They need capital, but there’s cash flowing, so you just sit and wait.”