Mall working to pay back taxes; City’s attorneys trying to collect

VALLE VISTA MALL SIGNAGE.jpg

Meanwhile, the Linebarger, Goggan, Blair & Sampson law firm is trying to collect the back taxes — of which more than $131,000 is owed to the city of Harlingen, City Manager Dan Serna said.

“We’re taking care of it,” Mike Kohan, the mall’s owner, said.

The mall owes $492,378.61 in back taxes for the 2019 tax year, according to the Cameron County Tax Office.

Of that amount, it owes the city $131,301.35.

“There are some delinquent taxes owed by the mall,” Serna said. “Those taxes need to be paid. (Tax attorneys) are working with the property owner to have those collected.”

Owner counting on city

Kohan said he’s counting on working with the city to improve the mall after federal, state and local officials lift the national business shutdown stemming from orders aimed at restricting gathering sizes to prevent the spread of the coronavirus.

“If we work together and try to understand each other I think we can pass that challenge,” he said. “The burden is on all of us.”

Meanwhile, city officials have met with Kohan to discuss plans to draw traffic into the mall.

“We look forward to seeing some improvements and development at the mall,” Serna said. “I know they’re working on some developments.”

Kohan didn’t disclose details.

Owner’s purchase

In 2018, Kohan, of Kohan Retail Investment Group in Great Neck, N.Y., purchased the 651,000-square-foot mall for $12.5 million following its placement on a real estate auction block after ProEquity Asset Management Corp. managed the property.

In 2017, Washington Prime Group turned over the property back lenders, citing profits had not met expectations.

Soon after his purchase, Kohan said he owned 22 malls, some “distressed.”

After the time, he said he planned to stage entertainment and events to help draw traffic to the mall.

Tough years

For years, the mall had been losing big-name tenants.

In 2017, Payless ShoeSource, rue21 and RadioShack closed.

At about the same time, Forever 21, which opened in 2009, replacing Mervyns, shut its doors.

By then, about 25 percent of the mall’s retail area stood vacant.

Later in 2018, Dillard’s, the mall’s flagship store, announced plans to serve as a clearance center.

Soon after, Sears, which had filed for bankruptcy, announced it was closing its store, which had stood as one of the mall’s original anchors.

Background

In 1983, Valle Vista Mall opened as the area’s premier shopping mecca, drawing residents from across much of the Rio Grande Valley.

By 2002, the construction of the Expressway 77-83 interchange blocked traffic to the mall, driving many shoppers to north Brownsville’s growing retail district.

For years, the mall has struggled amid changing consumer buying patterns and online shopping trends.

In 2008, the city offered the mall more than $1.2 million in incentives to help Simon Property Group, the management company which brought the mall to town, upgrade the property.

Valle Vista Mall’s delinquent property taxes:

Harlingen — $131,301
Cameron County — $91,054
Harlingen school district — $253,515
Port of Harlingen — $6,252
South Texas school district — $10,254
Total — $492,378

fdelvalle@valleystar.com