A real estate investment firm based in Boca Raton, Florida, has bought the Chicago Ridge Mall from the Miami-based Starwood Capital Group in the latest change for a south suburban shopping center.
The 889,610-square-foot mall off of 95th Street and Ridgeland Avenue in Chicago Ridge has undergone changes since it was first built in 1981. The most notable recent alteration is a Dick’s Sporting Goods which opened in 2021 in place of the large Carson’s store, space that remained vacant for three years.
Despite some struggles by Starwood, including a failure to make a $76 million debt payment in 2023, according to Crain’s Chicago Business, the new owners said they are excited.
“Our overall objective is to enhance Chicago Ridge Mall as a go-to retail destination,” said Howard Levine, a managing partner and co-founder Second Horizon Capital, the mall’s new owner. “We believe we can maintain and enhance the center’s strong position in its community while at the same time strengthening its infrastructure and presence to support continued growth.”
Although the company has its headquarters in Florida, Camilo Varela, who is also a managing partner and co-founder, used to work in Chicago and said his firm has had its eyes on the mall for years. He cited its importance to the community and retail success.
Starwood, which handed over management duties of the mall to JLL, declined to comment when asked about the sale.
Burt Odelson, an attorney for Chicago Ridge, said the mall has consistently had an occupancy rate of over 90%. He said while the village was not involved in the sale, Starwood did inform the village about its transfer plans. The new ownership group has been in close contact with Odelson, he said.
Mayor John Lind could not be reached, but Odelson said Lind and the village leadership are excited about plans for the mall.
“They are going to invest a lot of capital into the mall to freshen it up and to make it even better than it already is,” said Odelson.
Varela and Levine declined to give any specifics on the purchase price or how much they plan to spend upgrading the building. But they said their investment plan will be significant and will focus on cosmetic upgrades, increases to onsite staff and investment in management with the intention of bringing in more tenants.
Second Horizon has bought and invested in malls all over the country including in Massachusetts and Arkansas. Varela acknowledged shopping malls are not the most sure investment. A projection by Capital One shows “up to 87% of large shopping malls may close over 10 years” even after thousands of malls have closed in recent years because of online shopping and the COVID-19 pandemic.
But Varela said his company is only interested in malls that exhibit a unique ability to succeed.
“We are not genetically and broadly bullish on malls,” he said. “We are very bullish on specific properties.”
JLL will continue to manage the property under the new ownership.
Chicago Ridge does not have a traditional downtown center, Odelson said. So when the new buyers connected with village leadership, Odelson said he told them he hopes the mall can further solidify itself as the village center with the investment that Second Horizon has pledged.
“We have a really nice Village Hall and police station but you don’t congregate there for really anything,” Odelson said. “I think these new owners are thinking in the right vein to make it even better than it already is.”
hsanders@chicagotribune.com
