Mission Plaza, a 50,000 square foot neighbourhood mall, was developed in the early 1970s, anchored by a 28,000 square foot Safeway and also comprised of ten small retailers and a pharmacy co-anchor. At the time of construction, Mission Plaza was located in the retail core of the city, having excellent street front visibility and access. In the mid 1980s, the Province of BC constructed a new highway connecting Mission and Abbotsford. This new highway caused the retail core of the city to shift to the west, leaving Mission Plaza outside the central business district. This shift in retail activity caused Safeway’s sales to plunge, and in response to this Safeway went dark prior to the conclusion of their lease in the early 1990s. By going dark, Safeway caused a domino effect of closures through the centre, and when Martello took over management in 1998 the site was a virtually 100% vacant ‘ghost mall’.
From 1998 to 2003, Martello was able to lease some of the vacant spaces, including the 6,000 square foot pharmacy space to Factory Direct Tools, but the centre was never profitable during this period and generally leased on a gross basis below market rates. The leasing situation began to turn around in 2004 when Martello was approached by both Liquidation World and Gateway Casinos to take large sections of the centre. Due to the landlord’s dire financial position Liquidation World secured the 28,000 square feet left behind by Safeway on a long term single-net lease at below market rents . Gateway consolidated the 15,000 square feet of vacant retailer’s spaces into a bingo hall on a triple-net lease at slightly below market rates. Over the following decade, the casino and Factory Direct Tools leases were renegotiated to a triple-net basis and rents were raised up to market. In early 2014 Liquidation World announced it’s bankruptcy in Canada, which would have resulted in a large vacancy problem starting all over again; however, through fast action and smart negotiation, Martello successfully leased the entire space to Value Village at market rates on a triple-net basis.
Over the course of sixteen years, Martello was able to counteract the changing marketplace and transform what was a vacant ‘ghost mall’ into a thriving high-traffic destination mall. The client now has stable long-term cash flow and achieved an enormous appreciation in the value of his asset.
7178 Horne Street Mission, BC
Reposition ‘ghost mall’ into Destination mall
Factory Direct Tools
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