Park Lane Mall may be empty sooner than its owner's January deadline because tenants are unable or unwilling to pay rent up front until then.
"We have to leave because we don't have the money to pay the five months rent in advance," said Michael Pettit, 46, owner of D's Gift and Boutique, which he purchased in October 2004. Pettit indicated he had no choice. "We need to sell everything we've got just to get into a new place (because the rent is so high). We're basically going to have our Christmas sale now."
San Francisco-based real estate investment group, M & H Realty Partners Ltd., which bought Park Lane Mall earlier this year, notified all but two tenants they need to vacate the premises at the end of the month or make arrangements to pay the rent in advance for the period they wanted to stay. Gottschalks department store and the Century Theatres will remain.
Evicted Park Lane retailers looking for new space shouldn't have any trouble finding it vacancy rates in line shops at shopping centers in Reno and Sparks are running 7.14 percent but like Pettit they may face sticker shock when it comes time to sign a lease.
The cost of that space averages $1.78 a square foot in anchored shopping centers, and rents range from about $1.25 to about $2.25 a square foot said Kelly Bland, a senior vice president of Alliance Commercial Real Estate in Reno. Newer centers command higher rents.
Some Park Lane tenants might be headed down the street to Sierra Marketplace at Moana Lane and South Virginia.
Ben Farahi, who heads the company that owns the center, says his company is willing to consider short-term leases at Sierra Marketplace.
Even Park Lane tenants who can afford to pay five months rent in advance say they won't do it because there won't be any foot traffic if only a handful of stores remain.
Those include long time tenant, Ruth Contreras, who owns Guys & Dolls Boots at Park Lane and Meadowood malls. Contreras's daughter, Sophia Arce, said it doesn't make much sense to remain another five months when the mall will be essentially empty.
"We're going to sell our inventory and then try to expand our other store," she said.
Yan Halama, owner of World Curio, would also like to stay but isn't interested in remaining in a mall with no foot traffic. "I don't know what I'm going to do yet because I didn't get my paperwork."
However, M & H Realty officials indicate a number of other tenants are planning to stay.
"A fair amount of people gave us notice, but I haven't had one call saying we don't want to stay," said Doug Lind, property manager for M & H Partners.
Marc Malone is one of those owners, but he credits his decision with the unique qualities of his store, Slot Car Warehouse.
"It's a destination kind of store and a unique hobby shop. So even if the mall is empty they will still come here. We'll have big sales over the holidays whether the mall is full or not."
M&H Realty isn't talking about its plans for the site yet, but some people speculate it could become the home of upscale housing, shops, and restaurants.
"I'm very excited we have someone who wants to rejuvenate that area and I'm looking forward to discussing its plans with the new owners," said Reno Mayor Bob Cashell, who met with principals of M&H prior to its purchase of the property because the land is in a city redevelopment district.
He said the group did not discuss specific plans it had for the property and speculated that one of the group's challenges will be "how to lay out their buildings so they don't build on leased land."
Though M & H Realty purchased about 50 percent of the 47 acre Park Lane Mall outright from Macerich Co., it only purchased its rights under a long-term lease on the other half of the property.
M&H Realty officials also met with John Hester, Reno's community development director. "During our discussion we talked about the transit oriented development corridor," he said.
The city's development plans call for high-density mixed-use projects along its Virginia Street transit corridor particularly where the transit stations will be located. Park Lane Mall is situated along the corridor and two stations will be built there.
"If they come in with a project that carries forth the concept of our plan we will support them through the planning stage and even make minor tweaks to the transit plan to accommodate them," Hester said.
That's what the city did for Silver Star Communities when it came forward to develop the site of the old Mark Twain Motel. That project, on the west side of Virginia Street opposite Park Lane, will include residential and commercial development.
Though M & H Realty has been mum about its plans for the Park Lane site, for Hester's part, he wouldn't mind seeing mixed-use housing and pedestrian-oriented streets, saying such a plan would go a long way to revitalizing the area.
