3rd District Court of Salt Lake City names receiver for financially distressed Trolley Square
, Lynn Arave
SALT LAKE CITY — The 3rd District Court of Salt Lake City on Friday appointed Bill Hoffman, chief executive officer of San Diego-based Trigild, as receiver of historic Trolley Square.
Hoffman will begin oversight of the property immediately.
The 318,562-square-foot, two-story retail center is situated on 13.5 acres located at the corner of 600 South and 700 East. The mall has more than 40 tenants and will operate under the same onsite manager, Hoffman said.
"At this point, our role will be to make sure the mall operates efficiently and smoothly as we enter the busy holiday season, as well as ensure that it is well maintained for shoppers who want to experience its top-notch shopping venues and historic ambiance," he said.
"We can also move forward with attracting new tenants to this mall," added Brian Morelan, Trigild's managing director of commercial real estate.
The once-thriving retailer and entertainment center has been in financial distress recently and is the subject of two active lawsuits.
A lawsuit filed this month by Bank of America claimed that property owner Trolley Square Associates defaulted on a loan and owes more than $57.6 million. The suit stated that Trolley Square failed to act in accordance with loan documents and turn over income generated by the shopping center once the loan went into default.
It was Bank of America that asked the court to appoint a receiver to run the mall in an effort to secure and collect rents from tenants, as well as maintain the property.
Another lawsuit filed by maintenance and engineering firm Sentinel Building Services accused Trolley Square Associates, management company Unico Properties and senior property manager Dawn Katter of failing to correct several building, fire, health and safety code issues at the property.
That suit alleged that Trolley Square's owners and management conspired to avoid spending the money necessary to make the repairs needed to bring the mall into compliance with building, health, fire and safety codes.
The suit, which seeks punitive and general damages, also alleged that ownership and management wrongfully terminated the maintenance contract with Sentinel.
Calls to ScanlanKemperBard, the Portland, Ore.-based owner of Trolley Square Associates, were not returned.
Trigild general counsel David Wallace said the company will work to improve the property with the eventual goal of finding a suitable buyer, ideally within about a year.
"Customers won't notice the difference," Wallace said, "and tenants won't notice the difference other than positive changes."
That was welcome news to 28-year Trolley Square tenant John Cottam, owner of the Spectacle custom eye glass shop.
"That's has been needed for a very long time," he said.
Cottam said the center's struggles have been especially challenging for merchants. If things don't change soon, he said he could be forced to move his business elsewhere.
"Trolley is a remarkable landmark," Cottam said. "But I've been losing money for some time now. … I'd like to see some drastic improvement very rapidly."
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