The city has put off making a decision over whether to give a tax break to the Bangor Mall pending more information, while at the same time a foreclosure on the mall appears to have been delayed.
The mall’s owner, Simon Property of Indianapolis, asked the Bangor assessor’s office on Jan. 8 for a tax break for the fiscal year from July 11, 2017, through June 30, 2018, citing economic factors that affected the mall’s value.
The company since has asked the assessor’s office for an extension to provide additional paperwork to support its claim the mall is worth less, Bangor City Assessor Philip Drew said.
“They asked for more time and we gave them until March 28,” Drew said. “Part of their appeal is to provide information to be considered by the assessor. I’ve asked for particular documents.”
In his original abatement request Simon’s tax manager, Aaron Carter, asked the city to value the mall at close to $32 million. That’s nearly half of the city’s appraised value of $60.9 million for the property as of April 1, 2017.
“The Bangor Mall has suffered greatly over the past few years from a number of economic hardships ranging from sales declines and increased occupancy costs to a rash of vacancies, including a key anchor department store, Macy’s, and, as recently announced, Sears, which will shutter their store in early 2018,” Carter wrote.
Simon defaulted on an $80 million loan taken out against the mall last October. The loan was sent to a special servicing company, LNR, which had the mall appraised at $28.9 million last fall. That’s 77 percent less than the $128 million valuation in 2007 when Simon took out the loan against the mall.
Drew said that so far, Simon has not provided a new appraisal. Nor has Bangor assessed the property’s value.
However, the Bangor Mall paid the second installment on its property taxes for the current year on March 5, 10 days before the tax deadline, according to Janelle Emerson, Bangor’s deputy tax collector. That means it is up to date for the year.
Another milestone that passed quietly this month was the March 7 date LNR set to foreclose on the Bangor Mall in its February progress report on the mall. That report also said it would complete its dealings with the mall on March 15.
LNR’s March report released late last week through commercial real estate data aggregator Trepp of New York said LNR still was conducting due diligence and moving toward foreclosing on the mall, but LNR removed the foreclosure date. It also changed the date to complete its dealings on the mall until April 30.
Manus Clancy, senior managing director of data research at Trepp, said earlier that it is not unusual for a foreclosure deadline to slip.
“It may not happen then if the due diligence isn’t completed or if Simon changes its mind about handing over the property to the lender,“ he said. Parties sometimes change their mind at the last minute, he added, and Simon could do that before all details of the foreclosure are completed.
The foreclosure documents have not been received by the courts or the Penobscot County Registry of Deeds.
The Bangor Mall and the stores around it make up almost half of the 6.4 million square feet of retail space in Greater Bangor, according to data compiled by Epstein Commercial Real Estate brokers.
Follow Bangor Daily News business news on Twitter @BDNbiz.
Follow the Bangor Daily News on Facebook for the latest Maine news.