Two South Florida real estate investors and brokers have paid a combined $23 million for the Via Port Florida mall in Leesburg, and say they have the experience to lease up and grow the struggling mall.
The 560,000-square-foot mall -- anchored by Sears, BELK department store, Petsmart and AMC Theaters -- had a vacancy rate of 22 percent at time of sale. Up to seven outparcel pads had been planned for development over the past two years by its former owner, but were never seen through.
"This was an off-market deal, and we were drawn to the upside of this property, the fact that it needed some refacing and remodeling," Abitbol told GrowthSpotter. "You have The Villages nearby that are growing, Mount Dora not far away, and there is a need for entertainment and retail opportunity in this area."
The Leesburg mall is Abitbol and Benzaken's first investment in Greater Orlando. Two transactions for the property closed on Oct. 16 and Oct. 20, and were recorded Monday in Lake County.
The seller, Turkish developer Via Port Properties, had previously bought the property in September 2014 for $13.28 million.
Via Port tried to make the mall an entertainment destination, installing a Fun Zone with 22 bowling lanes, a 5,000-square-foot arcade, two party rooms and a restaurant and bar in the area that once was a Target store.
"The previous owner was not a real estate investor, but underperforming properties is our core business so we see it with a different perspective today," Abitbol said. "We have several LOIs for new retailers in this center already for the next four months."
Via Port will continue at the mall as a tenant under Via Entertainment, and plans to open a new go-kart track inside the mall near its Fun Zone, Abitbol said.
Via Port previously had plans to lease and build five to seven new outparcels that could range from 3,000 to 7,000 square feet each, but never drew the retail and dining tenants.
Abitbol said he and Benzaken have inherited a few outparcel LOIs, and will see that plan to fruition.
The investors are considering hiring a retail broker from Greater Orlando with mall experience to help market the property.
By this time next year, Abitbol's goals for the mall include "a nice facade improvement on the property, more tenants in place and a 15 percent vacancy rate." He confirmed a name change for the mall would be coming soon.
"They are going to refocus and retrofit the mall to be a destination for entertainment," said Bruce Smoler, a South Florida attorney representing the group. "(The new owners) are very excited about it and are devoting their lives to this for the measurable future."