Trident Pacific and JLL Assure SF Centre Will Stay Open

A court-appointed receiver and JLL have assured tenants of the half-empty San Francisco Centre that the mall’s lights will stay on and its doors will remain open for business.

Representatives from the receiver, Newport Beach-based Trident Pacific Real Estate Group, and the Chicago-based JLL pledged to keep the mall alive at 865 Market Street, the San Francisco Standard reported, citing unidentified mall workers.

The new management group pledged to continue operating the 1.45-million-square-foot shopping center despite widespread rumors it would close in the wake of such high-profile shutdowns as Nordstrom and the Cinemark theater, with five store closures since the new year

The managers told tenants during a 90-minute meeting it was committed to hiring more security guards while trying to attract new businesses to the mall, the sources said.

The group said they are looking into live programming, such as music and art shows, to reactivate dormant parts of the property.

The mall’s new managers also said they’re engaging local media to spread the word that the center is still open.

Representatives for Trident Pacific and JLL did not respond to the Standard’s requests for comment on the meeting.

As the property’s custodian, Trident Pacific has the authority to manage, reposition and potentially sell the property.

In June, the owners of the mall announced they would surrender the property to its lenders. Westfield, a unit of Paris-based Unibail-Rodamco-Westfield, and co-owner Brookfield Properties, based in New York, ceased making payments on a $558 million loan tied to the nine-story property.

Trident Pacific enlisted real estate firm JLL as its property manager to market vacant spaces to prospective tenants. The firm is also responsible for regularly reporting on the property’s financial condition.

Trident Pacific reported that in October it collected $740,000 in rent from existing tenants against more than $1.9 million in expenses for the property.

The appraised value for the mall has fallen from $1.22 billion in 2016 to $290 million as a result of the store closures and pending change in ownership, according to Trepp.

A rebound of the mall is only possible after a change in ownership, retail experts said.

When a new owner buys the mall at a steep discount, the firm won’t be under the same financial pressures that Westfield was under, according to Cameron Baird, a longtime retail broker at Avison Young. Rental rates can be reset, similar to what’s happening in the city’s office market.

“The thing about that mall is, as great as it was, it has been in the same format for four decades,” Baird told the Standard. “The costs of operating it were so high that it probably priced a lot of the emerging tenants out.”

— Dana Bartholomew