BOARDMAN, Ohio (WKBN) – Washington Prime Group, the company that owns Boardman’s Southern Park Mall, has grand plans for the future but the best chance of those plans turning a profit must include financial help outside of the company.
“It became very clear that we were going to need help in order for us to be able to get anything close to a commercially reasonable rate of return,” said Washington Prime Vice President Matt Jurkowitz, who spent nearly a half-hour Wednesday afternoon talking about the plan with First News.
Washington Prime’s plan is to make Southern Park Mall a “hub of retail, dining, entertainment and recreational sports.”
The total cost of the redevelopment is $30 million, all of which Washington Prime will provide upfront. It’s hoping to recoup $6 million through a combination of tax incentive packages.
“We’re asking for 20% to help us offset what is non-revenue generating expenses,” Jurkowitz said. “This is intended to light the charge. This is going to be a project that catches fire. This is a kick-off of a new round of momentum for this site.”
Jurkowitz said “the primary” aspect of the project is the creation of a Community Reinvestment Area. By creating such a designation, it gives Washington Prime access to the financial tools necessary to help pay for the redevelopment.
The second important program being proposed is creating a Joint Economic Development District through which Washington Prime can partner with Boardman Township and a nearby city (Youngstown, Struthers, Campbell or Girard) to impose an income tax on the people working in the entertainment district.
The partnering city and Boardman Township would get some of the income tax but Jurkowitz said the majority would go to the mall to help pay its expenses.
Third, Washington Prime will also partner with the Western Reserve Port Authority, which will allow the company to save on the sales tax of construction materials.
Fourth, should there be additional money necessary to get to $6 million, Jurkowitz said a New Community Authority could also be implemented. It would allow Washington Prime to levy additional property taxes on its tenants with the extra money going to pay for redevelopment expenses.
“We would be putting in place a real estate tax on ourselves,” Jurkowitz said. “Frankly, our tenents would be such huge beneficiaries of our investment, that it’s something we feel confident they will be happy to pay.”
The plan is for these programs to be temporary.
“Certainly, our expectation is that this would be something retired at some point in the future,” Jurkowitz said. “WPG would insist upon it. We don’t want to create an open-ended program.”
The new entertainment and recreation area will be called Debartolo Commons and is expected to be operating by fall 2020.
Washington Prime Group will host a community forum on the project Friday, December 13 from 11:30 a.m. to 12:30 p.m. at Southern