Monday, January 31, 2011

Atlas Park Auction May Bring New Life to Shops

By David J. Harvey

The story of a mall plagued with financial woes and empty stores may soon have a new chapter. The Shops at Atlas Park, an open-air shopping center on Cooper Avenue in Glendale, is up for auction on January 28 after more than two years in foreclosure.

When developer Damon Hemmerdinger’s family-owned company, ATCO Properties and Management, opened the 400,000- square-foot, $200 million mall in April 2006, less than half the space was leased. Today, several storefronts remain empty.

Credit Agricole Corporate and Investment Bank, the New York branch of French-owned financier Société Générale, foreclosed on Hemmerdinger’s property in January 2009. The bank is likely preparing to unload their investment at a significant loss.

According to the legal notice of auction, the foreclosure debt was over $119 million by June 2010. And when at least two real estate firms were considering purchasing the mall in September, speculation put the buying price of Atlas Park as low as $50 million. Société Générale spokesperson Jim Galvin declined to comment.

According to Vincent Arcuri Jr., chair of Community Board 5, one of those companies met with community representatives while in negotiations. The firm, Chicago-based McCaffery Interests Inc., specializes in underperforming urban real estate, but eventually decided against the investment.

"We thought there was an ability to fix it,” Daniel McCaffery, president of McCaffery Interests, said to Retail Traffic. “But negotiations broke down."

Arcuri said he hopes whichever company wins the auction on Friday will pay attention to the community when deciding how to revamp Atlas Park.

“Whoever takes it over should listen to the community and the tenants,” Arcuri said, echoing years of residents’ criticism. “They need to bring in shops that the community and the young people are asking for.”

Hemmerdinger’s original plan for Atlas Park called for an upscale center that would attract
the wealthier shoppers of Manhattan and nearby Forest Hills. With poor access to the highway and shops that weren’t geared toward the surrounding community, Atlas Park failed to draw targeted crowds and alienated nearby Glendale residents.

While bolstering mall patronage was unsuccessful, it wasn’t for a lack of effort. Several buses were rerouted to connect with the property while Hemmerdinger’s father Dale was serving as MTA Chairman. But rather than attracting new patrons, the buses have been blamed for rising traffic congestion in the area.

Hemmerdinger even once ran a promotion at the Atlas Shops where he gave away $20,000 to mall shoppers. He handed out $1 bills and $1,000 prizes, calling himself a friend of the economy. The effort proved insufficient to promote an ongoing client base that would have prevented Atlas Park’s foreclosure.

After ATCO lost Atlas Park to foreclosure, a series of managers were brought in under the leadership of Societe General. The first replacement for the Hemmerdinger’s was the Mattone Group, and the most recent is CB Richard Ellis. None of the management groups have been
able to garner wide public support. “The management hasn’t been that good, because the bank has had complete control and has been calling the shots,” Arcuri said.

The community and politicians have floated several ideas about what should be done with Atlas Park, such as bringing in a supermarket like Target or Wal-Mart, or even opening space for City University of New York classes.

Council Member Elizabeth Crowley (D, Middle Village) proposed the CUNY partnership, and Crowley’s office said recently that she was exploring options such as medical facilities and breast-imaging centers.

"Atlas Park has the opportunity to serve as a positive economic engine for Queens and our city’s small businesses—but its value is dependent on its management," said Crowley. "I look forward to working with the new owner of Atlas Park to make sure this shop- ping center works with the community and the residents I represent."

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