The Pier is still shopping for a buyer.
Mall management told tenants Thursday that it was unable to reach agreement to sell The Pier Shops to a New York investor, so it continues to search for a buyer for the Atlantic City oceanfront property.
In an internal memo, mall General Manager Harry Geety said negotiations were held last month with real estate investor Michael Kohan, but ultimately proved unsuccessful. Geety said Kohan made an offer, but the amount was not disclosed.
“The Pier Shops is still seeking a buyer who will match our brand of excellence,” Geety wrote in the memo, a copy of which was obtained by The Press of Atlantic City.
Geety’s memo was in response to a story in Thursday’s editions of The Press that quoted Kohan as saying he is still interested in buying The Pier. Kohan, who owns malls nationwide, specializes in buying distressed shopping centers out of bankruptcy or foreclosure.
Kohan said he remains “ready, willing and able” to close a deal. But Geety’s memo indicates that the mall has ended negotiations with Kohan.
Formally known as The Pier Shops at Caesars, the four-level luxury shopping center has been on the market since an investment group that includes U.S. National Bank Association took over in an October 2011 foreclosure sale.
Attempts failed last August to sell the mall during an online auction that had set a minimum bid of $20 million. Kohan did not divulge how much he offered, but said it was less than $20 million.
The mall, which cost $200 million to develop, has struggled since opening in 2006 at the height of the Atlantic City real estate boom. The sluggish economy and the city’s six-year casino slump have made it difficult to attract price-sensitive customers to a shopping center that features high-end retailers.
The Pier’s shops include some of the glitziest names in retailing, such as Gucci, Louis Vuitton and Tiffany & Co. Restaurants and an upscale wedding hall-banquet facility are other attractions. A skybridge spanning the Boardwalk connects the mall to the Caesars Atlantic City casino hotel.
Kohan said his plan for rejuvenating the mall would include changing the tenant mix to add more lower-priced stores to make shopping affordable for Atlantic City tourists.
Kohan said The Pier has a $3 million annual loss on $12 million in operating costs. The electric bill alone is $1.1 million per year, he noted.
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