- The owner of the Wausau Center Mall has requested a $4.1 million loan from the city of Wausau, according to information released Friday.
The request from CBL Associates is for a 20-year loan with a two percent interest rate.
The mall hasn't done well since the anchor store JC Penney left in 2014.
However, Wausau Economic Development Manager Christian Schock says local economic groups want to make sure they want to keep the mall because of the city's unique situation.
"The city owns the property underneath the mall, and so this is, in essence, our rental property," Schock said. "CBL pays rent for this property, but we own a property that is not as rentable or marketable as it used to be."
That would mean less money coming into the city if the mall disappears. Newswatch 12 asked why CBL wouldn't pursue a privately funded loan.
"The mortgage that the mall has currently on the property doesn't really allow them to receive other financing, so you know, the mall is heavily leveraged at the moment. That's fairly well documented, and it's also a challenge from a cash-flow perspective," Schock said.
Younkers is one of the remaining anchors at the mall. The mall would use the loan to renovate the former JC Penney so Younkers can move in. CBL would then use rent from Younkers to pay back the city.
"I think that, through an education process, I think there are lots of folks who will see the advantages, and the future of the mall when you see the vision," Schock said.
Stakeholders in the project have been collaborating with CBL for months before this release. Schock said the local groups passed a mall consensus statement in June agreeing that they share the importance of the issue, and agree that the mall isn't growing.
"A lot of the discussions have revolved around turning the mall inside out, about opening up those storefront spaces, about engaging the street better, and about attracting retailers that like that style."
Economic leaders say the loan won't mean more taxes. The city wants to absorb the mall into its Tax Incremental Finance (TID) #3, which is much of the downtown and Wausau River District, according to Schock.
A TID is a financing tool that allows municipalities to invest in infrastructure and other improvements, and pay for those investments by capturing property tax revenue from the newly developed property. That means the tax growth from the area stays in the district and doesn't go into the city's general fund.
That shift into the TID would allow the city to use the funds to finance the loan. Meanwhile, the city wants to designate the TID #5, which encompasses the northern area of the Wausau Business District west of town, be designated as a donor district to TID #3 to facilitate this process.
The TID #5 closes in 2020, which means the city would receive fewer dollars in its general fund from growth in the business campus if the loan gets approved.
Schock says the local stakeholders believe something needs to be done to help the mall.
"If we don't turn the mall around now, it will be a detriment to the community, and it will be a difficult, increasingly difficult process to work through," Schock said.
The city released the details of the project for the first time Friday afternoon.
City workers say this is the start of the public period, and the plan will likely see changes.
CBL also request an additional loan for tenant space renovations, the exact amount would be determined if CBL secures a prospective tenant that requires physical improvements to the mall, this loan would also be repaid by the lease revenue of those newly renovated spaces and each opportunity would be reviewed by the City and stakeholders on a case by case basis, according to the city press release.
Wausau Center Mall Proposal
|Story By: Adam Fox
|Photo By: Wausau Center Mall