Business

Tuesday, Nov 20 2012 05:55 PM

Investors buy another piece of East Hills Mall

BY JOHN COX Californian staff writer jcox@bakersfield.com

Investors buying up pieces of the East Hills Mall have acquired another big chunk: the former Mervyns store at the shopping center's west end.

Modesto-based Save Mart Supermarkets, working with Bakersfield developer Clyde Barbeau, purchased the single story, 74,424-square-foot building from an Illinois real estate investment trust for $3.25 million in October.

The same company paid $3.3 million for the mall's interior late last year. It picked up the 100,000-square-foot former Gottschalks building at the mall's east end last year as well.

All the 241-store grocery chain would need now to control the entire mall property is the 104,000-square-foot Harris building, owned by a Madrid department store and clothing chain called El Corte Ingles.

Save Mart has declined to disclose its plans for the property, and Barbeau could not be reached for comment.

Bakersfield commercial real estate broker Duane Keathley said the grocer's purchase of the Mervyns space came as no surprise.

"It's another piece to the puzzle," he said, adding that it appears Save Mart will either try to buy the Harris space from the Spanish company or try to form a joint venture.

But then what?

"The long term question is, how does it get redeveloped, and into what?" Keathley asked.

Some local observers have speculated that the interior-style mall has run its course and that the property would work best as an open air retail center. That would require bulldozing most or all of the mall.

Though the property's ownership has been splintered, the main mall property entered foreclosure last year. Its lender tried to sell it at auction in December but no bids came in.

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