The future of the Boulevard Mall will take shape starting Monday with a few keystrokes.
Opened in 1962 at the corner of Niagara Falls Boulevard and Maple Road as the region's first enclosed shopping center, the mall today is in a precarious financial position.
Longtime owner Forest City Enterprises handed the mall over to the mortgage holder in 2017, and that company is putting the mall up for sale this week.
Local officials say it's a prime opportunity to revive the property, which sits at a key location in Amherst, near the Town of Tonawanda and North Buffalo.
"The Boulevard Mall is at the epicenter of Western New York, demographically speaking," said David L. Schiller, an associate broker with Cushman & Wakefield Pyramid Brokerage. "A capable developer with vision will turn that around. It won't be a quick fix."
Here's what you need to know.
What's happening Monday?
An online auction, hosted by Ten-X Commercial, starts at 11 a.m. Monday and runs through Wednesday.
Commercial real estate firm HFF has marketed the site. Companies and investors interested in bidding on the site have to pay a $50,000 participation deposit.
How did it get here?
Forest City put the property up for sale in July 2016 and, after no one came forward, defaulted on a $92 million loan payment in February 2017.
LNR Partners took over in December 2017 when Forest City walked away to avoid foreclosure.
The mall’s reported appraised value has plummeted from $159.5 million in 2006 to $29.9 million last year. Amherst last May lowered the mall’s assessment to $54.9 million.
"It's been exasperating wondering who it's going to be and how it's going to be and when it's going to be," said Amherst Supervisor Brian J. Kulpa.
What are they buying?
LNR Partners is selling a 64-acre property that covers most of the land and buildings on the east side of Niagara Falls Boulevard between Maple Road and Almeda Avenue.
It includes 687,000 square feet of rentable retail space that Ten-X states is 78 percent leased.
The sale includes the buildings that house Buy Buy Baby, Michaels and Chili's. It does not include the J.C. Penney in the mall, owned by that corporation; the former Macy's men's store, owned by Benderson Development Co.; and a former LA Fitness outlet, also owned by Benderson.
Separately, Ten-X is auctioning off the adjoining property at 675 Alberta, also owned by LNR Partners, where Wegmans has a ground lease.
How much will the mall sell for?
The starting bid for the auction is $6 million. But the Ten-X site doesn't say whether that's the reserve price and it's not clear whether LNR Partners would accept that price for the mall.
(The starting bid for the Wegmans parcel is $3 million, for point of reference.)
Back in 2003, when the retail climate was vastly different, the McKinley Mall sold for $48.6 million. Uniland Development Co. one year ago paid $15.4 million to become co-owner of the Eastern Hills Mall.
Why would anyone buy a mall?
Amherst officials say the property is attractive because of its size, its location on heavily traveled Niagara Falls Boulevard and between the two University at Buffalo campuses, the commercial and residential density of the area that surrounds the mall and its inclusion along the projected path of an expanded Metro Rail.
"You say Boulevard Mall, people know where it is," Amherst Planning Director Dan Howard said. "There's an identity."
A key reason that developers will want to bid on the property now is its inclusion in the federal opportunity zone program, said A.J. Baynes, CEO of the Amherst Chamber of Commerce.
What's an opportunity zone?
The program sets up targeted zones in high-poverty census tracts where investors and corporations can defer taxes they owe on capital gains.
They can reinvest those gains, whether on their own or through pooled funds, into a project in an opportunity zone and pay a lower tax rate on the money they invested. If they hold on to the investment for 10 years, they don’t owe taxes on any of the gains.
Who's going to make a bid?
Nick Sinatra of Sinatra & Co. Real Estate is the only local developer who has expressed interest publicly.
Benderson is another obvious possibility, given the company's extensive holdings within the mall footprint and farther north to its the Boulevard Consumer Square retail complex and office park on Ridge Lea Road. A Benderson executive did not respond to a request for comment.
Ciminelli Real Estate Corp. and Mensch Capital Partners, which is working to redevelop the former Westwood Country Club site in Amherst, both said they don't plan to bid.
"I think there's a lot of people who are keeping their cards close to their vest," said Executive Director David Mingoia of the Amherst Industrial Development Agency. "I actually would be surprised if it didn't sell."
When will we find out if there's a buyer?
It's not clear if or when HFF or LNR Partners would announce they have accepted an offer. An HFF spokeswoman said she couldn't comment on the sale.
Once the purchase closes, the deed would be filed with the Erie County Clerk's Office. Amherst officials say the closing could happen as soon as 30 days after a bid is accepted.
What will a new owner do with the mall?
More to come, of course. Amherst, for its part, is pitching the property as a redevelopment opportunity.
Town officials want to see the mall property better connected to the surrounding neighborhood. They envision multistory buildings constructed right up to the street, housing for students and seniors above restaurants with outdoor cafes and tree-lined streets that cut through the site.
The town is prepared to make zoning changes and infrastructure improvements to help bring this town center vision to life.
"It's important for the town's growth. We're built out. We have wetlands and farmlands left, for the most part," said Maggie Hamilton Winship, the town's director of strategic planning. "So we have to start redeveloping and focusing on infill."
What's a town center?
Think of the lifestyle center planned for the Eastern Hills Mall in Clarence as a guide, although Amherst officials say development at the Boulevard Mall site could be denser and taller.
Uniland and partner Mountain Development Corp. estimate they will spend $200 million to $300 million over three to 10 years to transform that site into an open-air, walkable community anchored by housing and retail, restaurants and community attractions.
Local planners point to Belmar, in Lakewood, Colo., and Crocker Park in Westlake, Ohio, as examples of thriving town centers.
What's the timeline?
Little should change at the Boulevard Mall anytime soon as stores continue to operate under existing leases. Any new work is likely to take place on the outer portion of the property before moving to the center.
Full reuse is years away, but any buyer that wants to earn the maximum opportunity zone tax benefits must follow an aggressive timeline. The new owner needs to file a development plan to the IRS by the end of the year, and start construction soon after.