By Brandi Bottalico, Frederick News Post
Wednesday, November 23, 2016
Frederick Towne Mall is up for auction online.
A live auction runs Dec. 6 through 8 on the internet auction site Ten-X.
The minimum bid is $2.5 million.
There is an undisclosed reserve price, said Mike Besack, a spokesman for Ten-X’s commercial division. In general, a seller agrees to sell a property when bidding reaches the reserve price and does not have to sell the property if the reserve is not met.
The Frederick Extra first reported news of the auction.
Frederick Towne Mall has sat vacant since 2013. Property owner Rockwood Capital planned to demolish the former mall at 1301 W. Patrick St. and construct a four-building shopping center with a 155,000-square-foot Wal-Mart anchoring the project. Wal-Mart pulled out of the deal at the beginning of September.
Rockwood Capital considered selling the property or continuing with the project if another retailer stepped forward to replace Wal-Mart, but there was no interest in a replacement project, said Dave Severn, attorney for Rockwood Capital. The decision to auction the property was made about 30 days after Wal-Mart pulled out.
“I think we’ve known from the get-go that Wal-Mart was really the only tenant possibility,” he said. “[The online auction] is a nationwide approach to selling property,” he said.
After investing what Severn estimates is likely millions of dollars in the property, Rockwood Capital has made it clear it is very interested in selling the property, he said.
“We’re hopeful that someone buys it who is willing to move forward to get it redeveloped,” Severn said. “I think everybody wants to see something positive happen there. The current owners — I think they’re just exhausted at this point.”
The property is 46.1 percent leased by local and national tenants, according to the Ten-X listing. Boscov’s lease expires in November 2023. The second-largest tenant, Ollie’s Bargain Outlet, has a lease that expires in August 2021.
Home Depot is an anchor tenant.
The property is listed as having about 639,000, with nearly 520,000 rentable. The parcel is 37.35 acres.
Justin Kiska, president of the Golden Mile Alliance, said the sale is just the next step and they had been expecting it after news of Wal-Mart pulling out.
“It was just a matter of when and how,” he said. “This just means that somebody with fresh ideas will come in.”
He said real estate auction sites seem to be the way many big properties are sold now. The alliance will wait to see if it’s a national or local buyer.
“I would hope it would be somebody who isn’t just looking for a tax break but somebody who is going to come in and recognize the potential of what that type of land has,” he said.