Park Plaza Mall, a prominent retail destination in midtown Little Rock, has experienced a significant 40% reduction in its assessed value. This substantial decrease has led to a refund of approximately $500,000 for the mall’s new owners, according to an agreement finalized between the previous owners and the Pulaski County assessor’s office.
Documents filed in Pulaski County Circuit Court on Monday revealed that the valuation of Park Plaza Mall, excluding the Dillard’s Department Stores anchor spaces, has been adjusted from $50 million to $30 million. This agreement reflects the changing landscape of retail real estate, particularly for traditional shopping malls like Park Plaza Mall Little Rock.
This settlement mirrors a similar case involving the Outlets at Little Rock, another retail development located at the Interstate 30/Interstate 430 interchange. The Outlets at Little Rock saw an even more dramatic value decrease, plummeting to $34.3 million. This figure represents a 43% drop from its initial assessment of $61,050,000, which was contested by the former owner. Court records indicate that the owner in the Outlets case is due a refund of $374,500.
These agreements follow closely on the heels of settlements reached with Walmart Stores Inc. regarding their eight properties in Pulaski County. Walmart’s properties collectively saw a $19.3 million decrease in value, now assessed at less than $124 million, a 13.5% reduction overall. The specific refund amount for Walmart was not immediately disclosed.
Sources involved in these legal proceedings on both sides attribute these valuation reductions to the ongoing and accelerating shift in consumer behavior, moving away from brick-and-mortar retail shopping towards online platforms. This trend, impacting malls nationwide, is significantly affecting the financial performance and perceived value of traditional retail spaces like Park Plaza Mall Little Rock.
Previously, the assessed values of Park Plaza and the Outlets of Little Rock were comparable to that of the new Amazon.com fulfillment center at the Port of Little Rock, which opened the previous year. The assessor’s office currently values the Amazon facility at $111.7 million, though its actual market value may be even higher, considering a similar Amazon fulfillment center in North Little Rock was purchased for $169 million.
William K. Elias, legal counsel for the former ownership of Park Plaza, while refraining from commenting directly on the specifics of the case, acknowledged the visible decline in value of traditional retail properties. “You can see the effect of online shopping — e-commerce — on retail establishments and retail real estate. It’s a phenomena going on all across the country,” Elias stated in an interview, highlighting the broad impact on malls similar to Park Plaza Mall Little Rock.
Joe Thompson, chief administrator for Pulaski County Assessor Janet Troutman Ward’s office, explained that the county opted for settlement in these cases primarily due to two key factors. Firstly, there was concern that proceeding to trial could result in even greater value reductions imposed by a judge or jury. Secondly, the assessor’s office recognized the same underlying trends observed by Elias.
“With the changes that have been happening in retail, especially large retail and how they are earning less not only with covid but with online vendors and that kind of thing, it did appear [the value] needed to be lowered,” Thompson elaborated, pointing to both pandemic-related impacts and the overarching influence of online retail competitors on establishments like Park Plaza Mall Little Rock.
Park Plaza’s previous ownership entered bankruptcy proceedings over a year prior to these settlements. CBL Properties, a real estate investment trust based in Chattanooga, Tennessee, eventually emerged from bankruptcy but divested itself of Park Plaza, which was just one of over 100 malls in its extensive portfolio.
Ultimately, the lender foreclosed on the Park Plaza property due to an outstanding loan of $99.4 million owed by a CBL affiliate, Park Plaza Mall CMBS, LLC. Court documents revealed that Park Plaza’s income generation was insufficient to meet the required loan repayments, leading to the financial distress and subsequent change in ownership of Park Plaza Mall Little Rock.
Park Plaza was acquired at auction by its lender in the fall of last year. Currently, it remains operational under the management of a court-appointed receiver, the Woodmont Co. Woodmont continues to actively market available retail spaces for lease on its website, seeking to maintain and revitalize the shopping destination amidst these challenging retail market conditions affecting malls like Park Plaza Mall Little Rock.
The mall encompasses a substantial 547,000 square feet, a figure that includes all retail spaces excluding the two Dillard’s Department Store locations situated at either end of the property, which were not part of the recent sale or valuation adjustments. This detail is important in understanding the scope of Park Plaza Mall Little Rock as a retail entity within the community.
Support journalism that digs deeper into topics that matter most to Arkansans.
