Tax Break For an Existing Mall?

If you’re driving by the Shoppes at Bel Air, you may have seen the facelift it’s undergoing.  Inside it’s giving some retailers a reason to be excited like, Petrie’s which just reopened after moving.

“We’ve been in the mall for 13 years, and we’re very excited about the restaurants, and H and M, and all the changes with the mall, everybody’s getting fresh new stores,” said Emily Cobb, Petrie’s.

And to help with all the upgrades Mobile Mayor Sandy Stimpson is proposing to give the mall’s owner a $7.5 million break over 15 years. This Tuesday at Government Plaza, a city committee met with the mall owners discuss the potential deal.

“You know we wouldn’t expect incentives for a glorified paint job,” said Kevin Connell, Vice President Development & Construction at Rouse Properties.

Connell says it’ll cost far more than the 25 million dollars to continue upgrades.

“What we’re dealing with here is a mall that is in the very heart or our city and we need to make sure that retail experience is thriving in our city, I think it’s a good deal,” said Joel Daves, Mobile Council Member.

But the break comes from taxpayers.

“I’m still concerned it doesn’t represent any new square footage like the other incentive packages that we gave using tax dollars as a return to the developer in partnering with them,” said Bess Rich, Mobile Councilmember.

So the proposal is based on a 2015 tax revenue base which equals $7.4 million.  The mall’s owners need to make 110 percent above that base. That comes out to $8.1 million so for every dollar above this; taxpayers keep 80 percent, and the mall gets a 20 percent cut or rebate.  The cap is at $500,000, and again the term is for 15 years.

Rouse’s also had to promise to fill in the Belks at Springdale once that store consolidates at the mall. And they also have to bring in 80 percent new stores to the available leasing space, but the other 20 percent can be tenants from anywhere.

“You know with those incentives they’re going to have the ability to pick these tenants out,” said Steven McMahon, Legacy Village Retail Center Owner.

The proposal will now go before council next Tuesday.

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