The new owner of Hampton's largest mixed-use development plans to build town homes and more apartments on portions of the property that were never developed by the original owner.
The construction is a part of a plan to bring renewed energy to Peninsula Town Center, which has its third owner in as many years. The Tabani Group bought the development in Coliseum Central on Oct. 6 for $48.5 million in a deal that covers the 18 subdivided parcels including the Chapman Apartments, movie theater and dozens of storefronts. Target and J.C. Penney Co. own their buildings.
"We consider ourselves doctors for sick properties," said Abbas Kanji, of the Tabani Group. "The issue here wasn't structural because it's a beautiful property and the location is phenomenal. The sickness was in the financing of the original bonds."
Kanji said the Dallas-based retail investment company plans to build an additional 100 residential units originally planned for the property and to develop vacant blocks along Kilgore Avenue and along the north and west portions of the property.
The Chapman Apartments are 97 percent occupied and the center's apartments have been one of the strongest components of Peninsula Town Center, he said.
Leasing agents Divaris Real Estate and Thalhimer were hired to draw commercial tenants to the center. PetSmart will open a storefront along Von Schilling Drive on Nov. 8 and Encore Shoetique and My Pi Custom Pizzas are also finalizing plans to open in the coming months, Kanji said.
Faneuil Inc. announced in May it plans to open a 22,250-square-foot facility in the Claiborne Building that will include as many as 400 customer-service jobs.
Hampton Mayor George Wallace and city staff met with the Tabani Group on Thursday.
"I'm very pleased with the expertise and passion they bring to sustain and enhance the Town Center with a new and novel development plan," Wallace said.
Peninsula Town Center is also preparing to host holiday events in late November.
A Nov. 22 tree lighting will accompany the annual Coliseum Central parade. The event will include carriage rides, appearances by Santa Claus and Mrs. Claus, street performers and a concert, said Rachel Anderko, Peninsula Town Center marketing manager.
The Tabani Group plans to give away about 850 gift cards valued at $20,000 during a property-wide event starting at 6 p.m. on Thanksgiving and extending through Black Friday. The event includes a food drive, live radio broadcasts and military appreciation discounts, Anderko said.
The goal, Kanji said, is to get shoppers excited about visiting Peninsula Town Center.
A time frame for when construction would begin on the town homes wasn't immediately known, but the Tabani representative said the developer plans to fill retail vacancies, build new apartments and develop vacant lots in a multi-front push of activity.
Tabani will need to work with the Peninsula Town Center Community Development Authority, a public entity created by the city in 2006 to finance and oversee the streets, sidewalks, parks and parking garage. The developer must pay back the balance of a $92.8 million loan used to finance construction of the public infrastructure.
The authority adds a special assessment, a 0.5 percent charge, on purchases made at businesses at Peninsula Town Center to pay for those infrastructure improvements.
"There are so many ways we can add value to this place," Kanji said. "We're here and we're working on it as we speak."
Brauchle can be contacted by phone at 757-247-2827.
PENINSULA TOWN CENTER
Gross leasable area: 1.1 million square feet
Total retail space: 874,319 square feet
Total office space: 115,892 square feet
Total residential units: 158
Series of owners:
2010: Peninsula Town Center opens. It is developed by Mall Properties Inc., of New York City.
November 2010: Mall Properties and HSBC agree to amend construction loan reducing the interest rate to 2.25 percent, from 3.5 percent.
July 2011: Mall Properties and HSBC agreed to second amendment reduces amount of construction loan to $154.9 million, from $168.5 million.
December 2011: Mall Properties receives a notice of default from HSBC Realty Credit Corp for failing to pay debt service on the construction loan.
August 2012: Bank demands that developer cooperate a foreclosure of the construction loan.
October 2012: The Hampton Industrial Development Authority pays continues paying for $1.9 million grant to the developer for "tenant inducements."
December 2012: Mall Properties reports that outstanding construction loan balance is $147 million.
March 2013: HSBC, under the subsidiary Hampton Owners LLC, is the high bidder for the 18 subdivided properties owned by the developer.
October 2014: The Tabani Group buys the parcels for $48.5 million. The Dallas-based firm must also assume remaining liabilities of the $92.5 million community development authority bond.