Proposed buyers to bring Galleria into 21st Century
While the Galleria shopping complex in Mt. Lebanon has seen several owners in its short life, what it hasn't seen enough of is customers.
Frank Kass of Continental Real Estate Co. wants to change that. He told Mt. Lebanon commissioners Tuesday, however, that it will take money to switch the old Kaufmann's building-turned shopping center into a "gathering place" for shoppers in the South Hills.
"We need to fix up this shopping center and let it come screaming into the 21st century," said Kass, Continental's chairman.
The Columbus, Ohio-based company signed an agreement in November to purchase the 240,000-square-foot retail, restaurant and entertainment development. The sale is expected to be completed the second week of January.
Continental also is the developer of The Waterfront, a $300 million retail, entertainment, restaurant and residential complex in Homestead, West Homestead and Munhall.
Ownership of the Galleria has changed hands a number of times since First City Co. first converted the former Kaufmann's department store into the development in 1988.
Richard Zappala of First City developed the store and sold it in 1993 to Gilkeson Road Corp., a Connecticut-based investor.
A year later, Gilkeson sold the property to the Alaska Permanent Fund and L&B Realty Group of Dallas, a pension fund adviser. The fund, which invests money obtained from oil rights it issues in Alaska for the benefit of Alaskan residents, had 70 percent interest in the property, while L&B owned 30 percent.
They had been trying to sell the complex for three years.
Barry Ford, vice president of Continental, said it would purchase the property for about $17 million and invest an additional $13 million to $14 million to revamp the complex.
That will involve a complete overhaul of the interior and exterior of the mall, improving signage, access to the site and the parking garage, Kass said.
"This is no easy putt," he said.
Kass asked commissioners to put together a committee to work out signage issues, parking garage repairs and other subjects associated with moving the development forward.
Once the sale is final, Kass said, work will start immediately.
"We'll go like crazy after the day we close (the sale)," he said. "It will be fast."
He estimated that the renovations could be completed in one to two years. Already, the firm has contacted retailers, who have been receptive.
"We've already started retenanting, but they won't come without a fix-up," he said. Those tenants could include Bravo Italian restaurant, Barnes & Noble and a Pottery Barn, Kass said.
Success of The Waterfront development has retailers anxious at what could happen with the Galleria, Kass said.
"We pulled a rabbit out of the hat (with The Waterfront)," Kass said. "What we did at The Waterfront, we can do here. The demographics (of the location) combined with our experience has people excited."
Excitement is just what the complex needs, said Jack Lucks, Kass' partner and head of Continental's residential development division. On his visit to the center Tuesday, Kass said Lucks counted 73 people in the Galleria -- "only 54 of which were employees," Kass said with a laugh.
"It's two weeks before Christmas, with two of the hottest movies showing at the theater," Kass said. "And you could have put a rabid lion in that building and people would have had plenty of room to hide."