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Two Charleston properties change hands after foreclosure sale

Two large shopping centers in Charleston - the Citadel Mall and the West Ashley Shoppes - have come under new ownership in a move that may signal the sale of the properties in the near future. The Citadel Mall was essentially repossessed by its mortgage holders after no offers were made at the foreclosure sale in downtown Charleston. The minimum bid at the public auction was set at $65 million. The mall's mortgage lenders formed a new entity in July 2103 that now owns the commercial real estate. They plan to oversee the mall's operations until it can be put back on the market.

Citadel Mall is a 1.1 million-square-foot shopping center that is one of the largest in South Carolina. It was previously owned by a company related to CBL & Associates Properties, a firm based in Tennessee. In May of 2013, CBL started falling behind on mortgage payments and a judge appointed a company known as Spinoso Real Estate Group to operate the mall. This group will continue to act as property manager for the shopping center under the new ownership. At the time of foreclosure, CBL owed over $64 million of the $75 million originally loaned to them in 2007.

The change in ownership will likely have little effect on customers and tenants. One mall representative stated that retailers, vendors and customers should not expect any changes in the typical daily operations. The larger anchor tenants in the mall actually own their own sites within the center, so there will be no effect on those businesses either.

One attorney commenting on the foreclosure stated that it has become more common for banks to take back commercial property since the recession began. While the day-to-day business within both the Citadel Mall and the West Ashley Shoppes will not be affected, creditors do still intend to reopen bidding on the properties eventually. The properties may change drastically depending on if and when they are sold.

Source: postandcourier.com, "Lenders repossess Charleston's Citadel Mall, West Ashley Shoppes at foreclosure sale" Abigail Darlington, Jan. 07, 2014

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