Olympus Hills Shopping Center has launched a serious search for a new anchor tenant, a year after Smith's Food & Drug pulled its store out of the mall in favor of a larger location nearby.
"Olympus Hills is now able to offer the property on the market for lease by another major superstore operator," said Robert S. Campbell, attorney for Olympus Hills' owners.Although the legal battle between Smith's and the center continues - Smith's has appealed to the Utah Supreme Court a jury's decision that it broke it's lease with the mall - the two signed an agreement recently that frees the empty space for rental.
The two businesses began sparring in March when Smith's announced it was moving out of Olympus Hills, 3981 S. Wasatch Blvd., and into a former Skaggs Alpha Beta location a few blocks away.
Smith's had not fulfilled its 30-year contract with Olympus Hills at the time it moved. It opened a case-lot store in the empty space.
In a "nondisturbance agreement" drawn up recently between the two businesses, Smith's agreed that even if it wins its appeal with the Supreme Court, it will not try to kick out a new tenant and take back its space in the mall, said James Jardine, attorney for Smith's.
Without such an agreement, "it would have been virtually impossible to lease the property on any meaningful basis to another anchor tenant," Campbell said.
The mall, likely could not have persuaded a new tenant to spend thousands of dollars to remodel the deserted store if it faced the prospect of being kicked out should Smith's win its appeal.
Campbell said the agreement represents an acknowledgment by Smith's "that the property isn't rentable at all with the cloud of Smith's appeal hanging over it."
But now Olympus Hills can offer the space to a new tenant without worry that Smith's will demand the space back if it wins its appeal.
The 3rd District Court will watch closely to see how successful Olympus Hills owners are in finding a new tenant. The court has yet to rule on how much damage Smith's did to the mall by breaking it's lease there, Campbell said. Part of that assessment will be based on how successfully Olympus Hills can lease the space out, he said.
Since Smith's broke its lease, "the property has significantly depreciated in value," Campbell said. Traffic in the mall dropped off by 70 percent.
A jury ruled in November that Smith's had violated its contract with the mall by moving out. Based on that finding, 3rd District Judge Michael Murphy ordered Smith's to close the case-lot store it had opened in the space vacated by the grocery store and turn the space back over to Olympus Hills.
The court also must decide on how much Olympus Hills will receive in attorneys fees and costs.