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Mason City seeks lease with new owner of Southbridge Mall to build ice arena

Southbridge Mall
Southbridge Mall

MASON CITY – Despite the questionable track record of the new owner of Southbridge Mall, Mason City officials are quickly moving ahead with a plan to build an arena there.

A statement deep inside a document from city hall in Mason City says that now that Southbridge Mall is in private hands, the city is negotiating a lease for the former JC Penney store, the location where city officials want to build an ice arena.  There are many moving parts to this ever-changing endeavor the city is pursuing.

Connected to this revelation that the city is going ahead with leasing out a portion of the mall, vital state funding has not been secured for this roughly $36 million downtown “Renaissance” project. City hall is still pursuing upwards of $10 million from the state of Iowa through the Iowa Reinvestment District Program.  The last word NIT received from an official with the Iowa Economic Development Authority, which runs the program, was back on June 17.  That day, NIT was told by them that “today the board heard an update on the Mason City Reinvestment District project.”  The late Alex Kuhn told NIT after that meeting was held that “the mayor and city staff” attended the meeting and he did not go, as he typically had to previous meetings in Des Moines.  A state official said “the Mason City representatives asked the board to consider contingent approval of the project at next month’s board meeting.”

Brent Trout has stopped answering questions from NIT
Brent Trout has stopped answering questions from NIT

Mason City was not awarded the state funds at that July meeting or since, as doubt accumulated as to the prospects that a vital component to the 5-point Renaissance project – a downtown Marriott hotel – would be built by San Diego developer Philip Chodur, owner of G8 Development.  The city has continued to sign documents and land over to Mr. Chodur even as City Administrator Brent Trout alluded to a possible “contingency plan” the city cobbled together in case Mr. Chodur fails to break ground by October 31.  Mr. Trout thus far not answered questions from NIT about this contingency plan, but in July, he and city hall blamed the defeat of the Prestage pork plant for slowing things down for Chodur and altering his hotel design.

Now closed, this former Bank of America building could be torn down for a parking ramp.
Now closed, this former Bank of America building could be torn down for a parking ramp.

Just days ago, NIT was enlightened as to more details of city hall’s evolving plan for the downtown.  Apparently, city hall is not high on the chances that Philip Chodur will break ground in a city-owned parking lot on a proposed Marriott Hotel, across from Central Park.  If he fails, city hall has, behind the scenes, brought in a new developer from Illinois that would build a hotel inside or next to the Younkers department store footprint.  In recent weeks, the Mason City council awarded $250,000 to the owners of Younkers – Bon-Ton Stores, Inc.  NIT is told this action may be irreversible and the funds may have to be paid out to Bon-Ton even if the Younkers store is dramatically altered or even closed for hotel construction.  A parking ramp – another point in the Renaissance project – would be built where the former Bank of America building now sits, instead of the city-owned parking lot.  “People that work or live downtown will be able to lease spots in the new structure for a rate of between $75 to $100 per month,” NIT was previously told by Mr. Trout.

Inside Southbridge Mall
Inside Southbridge Mall

Even as all these developments come to light, Southbridge Mall was sold in September from bank ownership to that of Kohan Retail Investment Group from New York state.  Some citizens are questioning the past track record of this owner, as a number of reports in the media point to few positives but also some not-so-good behavior from Kohan in connection to the other malls they own.  For example, they reportedly didn’t pay utility bills and let some structures fall into disrepair.

Nonetheless, documents from city hall show that the city has wasted little time moving forward to do business with Kohan in pursuing a major point in the Renaissance project – a $12 million ice arena to be built the former JC Penney anchor store – leased by the city.

“Mr. Trout has sent the draft lease agreements to Kohan so that negotiations can begin with the new owners,” the document states.  “The sale of the mall was a major issue to be resolved prior to final approval of our Reinvestment District application.”

NIT has been told that a hurdle to possibly receiving state dollars for the Renaissance project was the fact that a bank owned Southbridge Mall.  The city may have leapt over this barrier, but a hotel must be built in the downtown for the entire project to go ahead.  In addition to the ice arena, hotel and parking ramp, a pavilion and mixed-use building would be built.

More to come on this developing situation.

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