Investment group in the process of purchasing Southern Park Mall

An investment group is in talks with the mall's owner, Washington Prime, to purchase the Southern Park Mall. With a potential new buyer, there are questions about the future of the Southern Park Mall.

Tenants have begun to receive letters alerting them to the potential change. The letter shows Kohan Retail Investment Group is in the process of purchasing the Southern Park Mall.

The group named in the letter has a history of falling behind on property taxes and other bills. 

Reports from news outlets all over the country show the group has a bit of a checkered history, with one calling them "the last owner a mall sees."

A retail real estate expert said that's normal for these types of investment companies.

"Kohan and a couple others like them, are what I call yield buyers. They buy the mall, not to save it, but to harvest the remaining yield from whatever rents are left in it," said Nick Egelanian, President of SiteWorks. "If it’s at a point where it's going to Kohan, it's already been through its best part of its life and really it's a dying mall, and what they will do is leave it a dead mall when they are done."

Although the goal of these investors isn't to redevelop the mall, Egelanian said there could be a positive outcome.

"They typically will bleed the yield out and then sell it at an even lower price. And that again, could be a good outcome if they are selling it when there's few barriers to redevelop it. But they can also create barriers for redevelopment," said  Egelanian.

One of the malls involved with Kohan Retail Investment Group is the Westwood Mall in Michigan.

This mall could face foreclosure after being purchased by Kohan in 2019. The Marquette County Treasurer told 21 news the owner of Kohan Retail Investment Group owes delinquent taxes and utilities have been repeatedly disconnected for nonpayment.

Egelanian said this isn't uncommon for investors like Kohan.

"It's fairly typical that they will cut a lot of staff, cut a lot of services, dispute real estate taxes and not pay real estate taxes," said Egelanian.

21 news reached out to Kohan Retail Investment Group multiple times to ask about future plans for the mall, but did not get a response.

Washington Prime gave 21 news no comment months ago when we reached out about the mall being for sale. They reiterated that today when asked about Kohan.