Mall sale of Sears space said done deal

New users of anchor slot a mystery

HARLINGEN — The former Sears space at Valle Vista Mall, all 90,000 square feet of it, has been sold, real estate brokers say.

Daniel Galvan, broker/owner of Coldwell Banker Commercial Rio Grande Valley in McAllen, said Thursday the buyer is a Dallas-based company which has been purchasing abandoned Sears stores at malls across the state.

Galvan said his firm has been working for the mall owners, Kohan Retail Investment Group, in trying to fill empty spaces at the mall for about a year.

And 90,000 square feet is a big one to fill.

“The idea I think, instead of trying to get one person to take all 90,000 square feet, is going to be divide it up and bring in two, three maybe even four smaller tenants,” Galvan said. “That’s going to be more feasible in the nature of this market and this economic climate. You’re probably going to see some institutional and entertainment type uses come in.”

Attorney Felix Reznick, one of three partners in mall owner Kohan Retail Investment Group, said Thursday he wasn’t certain just what might be coming to the Sears space.

“I’m not exactly sure who they’re putting in, but I think it’s commercial and office,” Reznick said, adding he thought the sale wasn’t yet a done deal, but “we’re close.”

“The selling of the Sears now brings a good powerhouse national company that has very good national connections and they’ll fill up the Sears and we’ll work with them,” Reznick added. “We’re hoping that we can kind of work together, and they bring more people, that attracts more people to our mall, and vice versa.”

Adding unconventional users like commercial and office space to a traditional retail property is part of the philosophy Mike Kohan, another partner in the Kohan Retail Investment Group, has been pursuing at the 30 mostly troubled malls his company has acquired.

The Kohan group bought Valle Vista two years ago for $12.5 million just a few months before Sears closed its store.

“It’s also an unconventional use that’s a little out-of-the-box thinking, but I think they’ll attract a ton of people,” Reznick said. “We’re always looking for new uses.”

Galvan said he was unable to disclose the purchase price of the Sears space at Valle Vista.

“I can tell you that it was fair-market value,” he said. “It wasn’t pennies on the dollar, it wasn’t anything like that. But it was a fair-market value type sale. It wasn’t a kick-a-man-while-he’s-down or anything like that.”

Galvan and Coldwell Banker Commercial previously helped Valle Vista land the Urban Air Adventure Park which took the space of another anchor tenant that left, Forever 21.

“We’ve been doing some leasing inside the mall on the institutional side, bringing in a data center and working with a call agency and things like that,” Galvan said.

“This will be something that will benefit the community ultimately, right?” he said of the Sears space sale. “My dad lives over in San Benito, and I grew up going to that mall, if you can believe it.”