Salisbury Mall in foreclosure

One of the entrances into Salisbury Mall reflects a lack of shoppers Tuesday night. The lenders have filed for foreclosure. Photo by Andy Mooney, Salisbury Post.

Shoppers stroll pass a vacant store in the Salisbury Mall. The mall is in foreclosure. Photo by Andy Mooney, Salisbury Post.

Both Goody's and Hallmark Cards have vacated the Salisbury Mall. The mall is in foreclosure. Photo by Andy Mooney, Salisbury Post.

By Emily Ford

eford@salisburypost.com

Lenders foreclosed on the Salisbury Mall Tuesday after the owners apparently defaulted on their loan.

Samco Properties of Deerfield, Fla., had not made a loan payment since July 2009, according to Rowan County Clerk of Court Jeff Barger, who signed the foreclosure papers.

Sam Spiegel and Simone Spiegel are founders of Samco Properties, a commercial real estate company that bought the mall in 2003. Samco owes $19,930,000 on the mall loan, Barger said.

This is the largest foreclosure he’s seen in 12 years as clerk, Barger said.

The Speigels could not be reached for comment.

“I am very, very disappointed and saddened,” Mayor Susan Kluttz said.

Salisbury’s largest indoor retail center, which covers almost 35 acres at Jake Alexander and Statesville boulevards, opened in 1986.

“This is a sign of the times and the tough, difficult economy we are going through right now,” Kluttz said. “In this economy, we continue to experience disappointments, and this is one of them.”

Both Kluttz and City Manager Dave Treme said they hope someone will buy the mall and continue the operation, saving jobs and businesses.

“Hopefully, someone will see the value in it,” Treme said.

Wells Fargo holds the note, Barger said. The bank did not immediately reply to an e-mail from the Post.

The lender will put the mall up for sale at 2 p.m. Dec. 14 in the lobby of the Rowan County Courthouse. Upset bids will continue for 10 days.

If no one else bids, the mall will go to the lender, Barger said.

He said he doesn’t know what minimum bid the lender will set. Normally, it’s the amount of the principal, or $19,930,000, but that’s up to the lender, Barger said.

Tenants at the mall expressed surprise at the news. None would go on record with a comment. The mall manager did not return a telephone call from the Post.

Belk and JCPenney stores anchor the mall. Tim Lyons, a JCPenney spokesman based at corporate headquarters in Plano, Texas, said JCPenney stores have been located in foreclosed malls in the past.

“Going into foreclosure does not mean closure,” Lyons said.

In the other cases, the malls remained open and the stores continued business as usual, he said.

“Typically, it has no effect on the operation of the store. We will continue to be there to serve our customers,” he said.

The tax value of the Salisbury Mall is $14,584,123, according to the Rowan County assessor’s office.

The $5.4 million difference between the amounts of the tax value and loan did not surprise Rowan County Tax Administrator Robert G. Rowland.

Rowland said the loan the Speigels took out when they bought the mall in 2003 incorporated personal property, such as store fixtures.

The loan also included money for significant renovations at the mall, including a restaurant and leasehold improvements, Rowland said. “All of those things contribute to the value of a loan, but not so much to the value of the real estate itself.”

The loan was made “when times were still very good,” Rowland said.

An entrepreneur like Spiegel probably landed a “top-dollar loan,” said Rowland, who said he was surprised by the foreclosure.

“If Sam has fallen on bad times ...” Rowland said. “He is, in my opinion, someone who could make about anything work. He’s good in that industry.”

Samco specializes in buying and improving shopping centers, office buildings and single-tenant commercial properties, according to the company’s website.

Through its affiliated companies, Samco owns and operates about 3 million square feet of commercial real estate, the website said.

In North Carolina, Samco also owns Marketplace Mall in Winston-Salem, Westgate Plaza in Durham and Forest Ridge Shopping Center in Asheville, the website said.

The Salisbury Mall has struggled to maintain occupants. Hibbett Sports, Chick-fil-A, Goody’s and Hallmark have left, among others.

Although the mall’s location has been criticized in the past as inconvenient and too far from Interstate 85, Treme said the foreclosure is not as simple as that.

“I think it’s mostly the economy, and I don’t think the location is a big factor, if at all,” he said.

Any fallout from the foreclosure on local economic development can’t be determined yet, he said.

“Certainly, it’s too early to tell the impact,” Treme said.

Hopefully someone will buy the mall and continue to offer residents a variety of local retail choices, he said.

“I’m a firm believer in shopping locally and supporting local businesses and keeping our tax dollars here,” Kluttz said.

The mall was Barger’s second multi-million dollar foreclosure Tuesday.

He also signed papers for a $2.2 million foreclosure on a commercial property at 120 Wilkinson Road in western Rowan County. The property is owned by People Against Drugs Affordable Public Housing Agency.

In 2008, Texas Attorney General Greg Abbott charged People Against Drugs Affordable Public Housing, its founder and three of its directors with violating the Texas Nonprofit Corporation Act. According to court documents filed by the state, the defendants illegally used charitable resources to fund the founder’s salary, support a NASCAR Truck Series team, and advance the founder’s political career.

The agency went into bankruptcy to stop the lawsuit.

Contact Emily Ford at 704-797-4264.