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Mall is up for sale

August 06, 1997

By STEVEN T. DENNIS

Staff Writer

Amid signs of growing competition, Valley Mall has been put up for sale.

Rob Stuart, a spokesman for Equitable Real Estate Yarmouth, the company that manages the property for the New York-based Prime Property Fund, said Wednesday that no deal is imminent.

The mall, which was sold in 1989 for $61.2 million, is assessed at a fair market value of $35 million, according to the state Department of Assessments and Taxation.

Stuart said there was no particular reason for wanting to sell the property.

"If you can get the price you want, everything is for sale," he said.

Stuart said that Prime Property's two other malls in the area, Frederick Towne Mall in Frederick, Md., and Country Club Mall near Cumberland, Md., were not for sale.

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Stuart said Valley Mall, the county's largest shopping complex at 700,000 square feet, was a strong mall with little competition.

The mall's sales have increased since a $4 million renovation updated its look, Stuart said.

But two new $40 million retail centers are planned for the Hagerstown area that could pose problems for the mall.

Stuart said Prime Retail's plans to build a $40 million, 100-store outlet mall on Sharpsburg Pike had little bearing on the decision to put Valley Mall up for sale. Stuart said the outlet mall wouldn't pose much direct competition.

Valley Mall had gone to court to argue against a rezoning for the outlet mall, but lost on appeal.

Another $40 million, 700,000-square-foot shopping center is slated for the intersection of U.S. 40 and Interstate 81.

County Commissioner Ronald L. Bowers said that if the mall is sold, the county could reap as much as $750,000 in recordation taxes. The county charges $7.60 per $1,000 in value when the deeds are transferred. But Rick Hemphill, supervisor of recording and licensing, said the tax could be avoided if Hagerstown Valley Mall Associates, a subsidiary of Prime Property, is sold. Because the name on the deed would not change, no deed would need to be recorded, Hemphill said.

The mall has changed ownership several times. In 1983, Valley Mall Associates sold the mall to Patrician Group for $41 million.

In 1989, the mall was sold by Maryland Mall Ltd. Partnership to Hagerstown Valley Mall Associates, consisting of Prime Property and the Edward J. DeBartolo Corp., for $61.2 million.

DeBartolo was later bought out of the partnership.

The mall is on 51 acres off of Halfway Boulevard at Interstate 81. Prime Property also owns 31 acres of undeveloped property behind the mall that is valued at $3.8 million.

Prime Property is a conglomerate of several pension and other funds, the largest of which is Equitable Life Assurance, Stuart said.

Prime Property owns $1.6 billion worth of shopping centers and also owns apartments, office buildings and other investment properties.

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