A New York-based lender has taken ownership of Pinecrest in Orange after the original owners suffered from COVID-19-related financial troubles.
Square Mile Orange Village, an affiliate with Manhattan, N.Y.-based Square Mile Capital Management, now owns the mixed-use lifestyle center as of Oct. 21, according to Cuyahoga County land records.
Fairmount Properties and DiGeronimo Companies, which developed Pinecrest in 2018, were given a $172 million loan from Square Mile in January 2019. The floating-rate loan was used to replace the existing construction debt of the 58-acre development.
The 750,000-square-foot complex has struggled since March as a result of the COVID-19 pandemic and subsequent state-ordered lockdowns of stores, restaurants and movie theaters, limiting the income for places like Pinecrest.
According to Orange Mayor Kathy U. Mulcahy, this move was a “deed in lieu of foreclosure,” allowing the original developers to give up the property instead of facing a foreclosure lawsuit.
Fairmount Properties, which has its offices at Pinecrest, will continue to act as property manager and take care of the day-to-day operations of the development.
“The most salient point here is to recognize that the current owner and property manager will be staying on for the new owner and be the property manager,” Mulcahy said. “So, there’s not going to be any changes in the project. I don’t even think a guest would notice a difference.”
Mulcahy said she has communicated with executives from Square Mile about the goals of the property.
“I have (spoken to them) and they understand our vision for the project and they know what their obligations are to the project,” Mulcahy said.
Pinecrest is off of Interstate 271 at Harvard Road and is home to national brand retail tenants such as Whole Foods, Vineyard Vines, Pottery Barn, J.Crew, Peloton, UNTUCKit, Silverspot Cinema and Orangetheory Fitness. On top of its many retail stores and restaurants, it also has 160,000 square feet of office space, 87 luxury apartment units, a 1-acre park and a four-story AC Hotel by Marriott.
When the state allowed retail shops to reopen on May 12, 89% of the private economy was open again, according to Gov. Mike DeWine. Consumer traffic at the property improved, but was still inconsistent when compared to numbers from last year.
On top of the COVID-19 pandemic harming businesses around the country, traditional brick-and-mortar stores have also been dwindling in popularity even before the pandemic forced retail shops into lockdown. Despite all of that, Mulcahy said she still believes Pinecrest has a bright future in the community.
“I think Pinecrest is going to land just fine,” Mulcahy said. “Traffic is starting to come back, tenants are coming back. We don’t know when the world is going to end, I don’t know how bad this is going to get. But if anything survives, Pinecrest will be at the top of the list.”
Alex Krutchik is a freelance writer.