Jill Litzel figures she has been shopping at Chapel Hill Mall in Akron at least half of her life.
The Cuyahoga Falls resident, now 40, admits she has had her doubts about the mall in recent years.
“It got shady for a while,” Litzel said. “It looks like it’s bouncing back. ... I don’t want to say it was super bad. It seems to be a lot cleaner. It looks more updated.”
And now Litzel said she is looking forward to bringing her daughter, who turns 1 in November, to the mall on a regular basis.
“I feel safe bringing her here now,” she said. “There’s a lot for her to look at. It’s a nice place to bring a little one.”
Since Chapel Hill Mall went into — and out of — foreclosure and receivership last year, the company running the property on a day-to-day basis, Ann Arbor, Mich.-based McKinley Inc., has been putting money into the mall, apparently on behalf of mall trustee U.S. Bank.
The mall operators appear to be doing the right things to keep the site viable, industry observers and others say.
Of course, top of mind of what not to do rests about 10 miles southwest in another part of Akron: Once dominant and now dead Rolling Acres, which in many ways became the national poster child for failed malls as photos of its decay spread through social media.
Chapel Hill Mall’s operators appear determined not to let another Rolling Acres happen on their watch.
Under McKinley, there’s a lot of new paint and other freshening up inside and out. New leather sofas and easy chairs have been placed inside. Interior lights have been replaced with highly efficient LEDs. Newly poured concrete has replaced cracked walkways that lead past freshened facades. There are freshly planted, colorful mums as part of a significant upgrade in landscaping. The mall now hosts monthly events to bring in people.
And it has beefed up on-site security that works 24 hours a day, seven days a week. The mall also is keeping up on maintenance and cleanliness.
More improvements are on the way, including a play area for small children in the food court that should be in place in November.
Still, vacancies persist — some 15 empty storefronts plus several openings in the food court at the mall’s main entrance. Neither U.S. Bank nor McKinley agreed to speak on the record about the mall; one McKinley representative said the company expects to fill many of the vacancies in the near future.
“I’ve seen a huge improvement in the mall in the last 15 months,” said Rich Gotch, manager of J.C. Penney, one of the mall’s three anchor stores. “I would say the biggest thing I’ve noticed is the cleanliness inside and out. ... Our traffic is up, yes.”
There is a stronger partnership now between the mall stores and management, said Gotch, who has worked at the mall 11 years. “It’s fun to work with people who have your genuine interest at heart.”
The financial struggles have caught the attention of local officials.
Now-retired Akron Mayor Don Plusquellic held a town hall-style meeting there last year to speak with store owners and employees.
Current Mayor Jeff Fusco, Cuyahoga Falls Mayor Don Walters, Tallmadge Mayor David Kline and Summit County Executive Russ Pry also have met to discuss the mall, said Sam DeShazior, Akron’s deputy mayor for economic development.
“We don’t want to see what happened at Rolling Acres,” said Adele Roth, Akron deputy planning director for economic development. “I don’t think the situation at Rolling Acres is the same as at Chapel Hill. Chapel Hill is in a much better position. …”
That is in part because highway access is better than at Rolling Acres, she said.
Buyers force change
Among the large shopping malls in the Akron area, Chapel Hill would be considered secondary to Fairlawn’s Summit Mall. Chapel Hill opened in 1967, a year after Summit.
Chapel Hill’s management appears to be doing the right things, Roth said. At one point years ago, Summit Mall, now the dominant mall, looked to be on a downward slide but has rebounded, she said.
The Howe Avenue retail corridor near Chapel Hill Mall appears to be vibrant, but retail sites on Buchholzer Boulevard are not doing as well. Chapel Hill Square, opposite the mall, was sold Tuesday to an unidentified buyer from Pittsburgh for more than $3 million.
Many malls will need to reinvent themselves, industry analysts said. Upscale malls and so-called lifestyle centers, sometimes called boutique malls that offer a combination of retail and leisure activities, are doing better than traditional malls, they said.
Green Street Advisors, a California-based real estate analysis firm, this year published a U.S. mall outlook report that said properties with higher-end stores and in moneyed demographics generally are performing well.
A so-called “A” or dominant quality mall does well as a destination center, the report said. Even “B” malls, with a mix of national and regional tenants with solid occupancy, generally are stable and adequately serve their shoppers, the report said.
The report also described a mall as “a fragile ecosystem.”
Considered the area’s “B” mall, Chapel Hill’s ecosystem took a hit when its former parent, mall owner and developer CBL & Associates Properties, announced the mall wasn’t generating enough cash to repay a mortgage and had defaulted. While the mall in June 2014 went into foreclosure proceedings and then was placed into receivership, it always remained open.
Earlier signs of distress were in CBL’s public filings with the Securities and Exchange Commission. The real estate holding firm disclosed that in 2013 it had reclassified Chapel Hill Mall and some of its other properties as “non-core malls.”
CBL, in a 2014 filing, wrote that the lender holding the mall mortgage had placed the loan in default. “Chapel Hill Mall generates insufficient income levels to cover the debt service on the mortgage, which had a balance of [$68.7 million] at Dec. 31, 2013.”
CBL turned the mall over to the lender in the third quarter of 2014 to avoid foreclosure, the SEC filings showed.
Chapel Hill Mall is now a “real estate owned” or REO asset in which the lender took the mall back, according to an analyst with real estate and banking research firm Trepp. The value of the property backing the loan was cut earlier this year from $60 million to $31.46 million, according to Trepp.
The ability to support bricks-and-mortar retail is “on the decline due to both online ordering and people moving from owning stuff to having experiences,” said Randy White, head of White Hutchinson Leisure & Learning Group, an industry consulting firm. “The ‘A’ malls are thriving, the ‘B’s surviving and the rest will be toast.”
Traditional mall owners are pumping more money into properties now than they were able to do during the Great Recession and immediately afterward, said Jesse Tron, spokesman for the International Council of Shopping Centers.
Improvements attract not just shoppers but also retailers, he said.
“You want to create some kind of experience,” primarily with dining and entertainment, Tron said. “Experience is king.”
Nationally, mall occupancy rates are at about 94 percent, the highest they have been in decades, Tron said.
Occupancy rates of 90 percent and higher are considered healthy, he said, while rates that fall to 80 percent are cause for concern.
Chapel Hill Mall’s 15 retail vacancies make up nearly 75,000 square feet, or 11 percent, of the mall’s 661,818 square feet. Cleveland-based commercial real estate firm Kelly & Visconsi is working to fill the spaces, according to McKinley Inc.’s website.
Chapel Hill Mall likely took a hit to its reputation in August when a man was stabbed to death outside following a fight that started inside. A suspect was arrested late last month.
Despite the stabbing, the mall remains safe for shoppers and employees, Akron police said.
“We want to reassure the community that Chapel Hill Mall is a very safe place to be,” Akron police spokesman Lt. Rick Edwards said. “The stabbing that occurred at Chapel Hill really was an isolated incident.”
The mall has increased security, including hiring off-duty Akron police officers.
The vast majority of police calls — more than 90 percent — are for shoplifting, Edwards said. That is typical for the area’s large retail sites, he said.
“It still looks like a safe, pleasant environment to come to,” said Tom Carey, 46, of Cuyahoga Falls, who described himself as “not a mall person.” Carey said he recently came to the mall for the first time in at least three years to buy clothes.
Stow native Nancy Camp, who now lives in Monroe, Tenn., said she makes a point to shop at Chapel Hill Mall every time she travels to Ohio to see family. On one recent afternoon, she was shopping with her two 20-year-old grandchildren.
“It is very clean here,” Camp said. “I wouldn’t go here if it was dirty. I look forward to come to this mall every time I come up here.”
Jim Mackinnon can be reached at 330-996-3544 or email@example.com. Follow him @JimMackinnonABJ on Twitter or www.facebook.com/JimMackinnonABJ. His stories can be found at www.ohio.com/writers/jim-mackinnon.