Orchards Mall's new owner: rescuer or bad apple?

The Orchards Mall in Benton Township, pictured June 20, has been sold to investor Mike Kohan of Great Neck, N.Y. Ammy Jannert, the mall’s manager, said she is confident the new owner will revitalize the property built in 1979.

BENTON TOWNSHIP - The new owner of the Orchards Mall wants to take it back to its roots as the area's retail center.

"We're going to fill it up and bring it back," said mall manager Ammy Jannert in announcing Thursday the sale of the mall to the Kohan Retail Investment Group of Great Neck, N.Y. "We're going to turn it back into a real shopping center. There is a breath of air coming in to breathe new life back in."

But news reports show that the owner, Mike Kohan, who owns malls around the country, has a checkered track record when it comes to reviving ailing properties.

The sale of the mall, built in 1979, was completed Tuesday. The sale price was not available.

The previous owner was the Sequoia Investment Group of Eureka, Cal., which bought the mall in 2002. It has been for sale since June.

Kohan, who also goes by the names Kohen and Mehran Kohansieh, is the head of the investment company that specializes in rehabilitating old malls. Orchards is his 14th property. The company operates malls in several states, including the Mayberry Mall in Mt. Airy, N.C., off the Andy Griffith Parkway.

Jannert, who has worked at the mall for eight years and will stay on as manager, said she's confident Kohan will spruce up the property and bring in major tenants and local businesses.

But media reports indicate that Kohan has struggled to meet his goals with other malls.

He bought the Rotterdam Mall in upstate New York, valued at $30 million, for $8.5 million, the Times-Union of Albany reported in January.

The paper also uncovered numerous problems with Kohan's projects nationwide.

One, the Woodville Mall in Northwood, Ohio, was acquired by Kohan in 2009. It was torn down in March by court order after inspectors found leaking ceilings, black mold, standing water, crumbling asphalt and other violations.

"I am buying distressed malls, malls that have litigation, malls that are in bade shape," Kohan told the Times-Union. "There are some projects we can turn around. Some we can't."

Kohan could not be reached by The Herald-Palladium for comment.

He owns the Northland Mall in Worthington, Minn., and was reported to owe back taxes on the property. The local CBS television affiliate reported in April that the mall looked more like a construction site that a shopping center, with "a leaky roof, buckets lined up on the floor and caution tape blocking off some areas."

Officials in Matteson, Ill., have tried to get Kohan's Lincoln Mall boarded up over safety violations, and then put the property into receivership, with an order that the owner pay for repairs.

The Daily Gazette of Schenectady, N.Y., found some success stories. City leaders are pleased with the improvements made to the Tulsa Promenade, which Kohan bought for $12.3 million in 2013, the paper stated.

But the paper also reported that leaders in Effingham, Ill., haven't seen much improvement at the Village Square Mall, which Kohan bought in a foreclosure sale in 2008.

Room to grow

Jannert acknowledged that the Orchards Mall - built on property that once was an apple orchard - has the image of being on a downward swing, which she thinks will be reversed.

She has been working with Kohan for several weeks on the many things that need to be improved at Orchards Mall to attract new retailers and customers, from lighting to landscaping to the parking lot.

The interior and exterior lights date from 1979, Jannert said. They already have completed a lighting study and will be installing more efficient, attractive lights. "We'll move in the direction of green - and that's an awesome thing."

They also have discussed the overall curb appeal of the 528,000-square-foot property, which sits on 60 acres at 1800 Pipestone Ave. in Benton Township.

"My opinion, personally and professionally, which is the same as the Kohan Group, is that the most important factor is to revitalize the building and the space to make it more appealing to retailers," Jannert said.

Jannert said she expects changes to be apparent within the next three to six months.

The new owner has a lot to build on, both with the building and the surrounding community, Jannert said.

"We are safe, we are clean, and the building is very sound," she said.

There are 37 businesses operating at Orchards, including JCPenney's, Carson's, Jo-Ann Fabrics and a Sears Hometown store, which sells appliances and tools, among other items.

Jannert said the Sears store is No. 1 among the Sears Hometown stores in the nation in sales.

With new hotels and retail businesses opening nearby, the Whirlpool Corp. headquarters close by and events such as the Senior PGA Championship, Orchards is now poised to take advantage of a growing community, Jannert said.

Kohan Investment will be working with Jones-Lang-LaSalle Commercial Real-Estate Group on leasing and marketing mall space.

Having a national leasing firm will help in attracting major tenants, Jannert said.

Kohan told the Daily Gazette that there are no guarantees in his business, but he touted his record of reviving formerly "dead malls."

"Nothing is 100 percent in this world," Kohan said. "When you invest on so many properties, obviously you're going to have one or two that can't be helped."

Contact: jmatuszak@theHP.com, 932-0360, Twitter: @HPMatuszak