Like many malls across the country, the Providence Place Mall is in dire financial straits. The facility is in receivership after the former owners racked up $259 million in debt and a new owner is being sought. It’s not known how much interest the mall will garner on the open market, especially since most of its original anchor stores are gone and vacant storefronts are becoming more noticeable.
Boston Globe reporter Steph Machado recently co-authored a story about the challenges and opportunities facing the Providence Place Mall. She sat down with Ocean State Media’s Luis Hernandez to chat about how the mall has evolved over the years and what the future holds.
Interview highlights
On the mall’s financial struggles
Steph Machado: So everyone talks about Nordstrom leaving as a huge turning point. That was announced in 2018, but it officially left the mall in 2019. Then the pandemic happened. And so it was this combination of one of the top anchor stores that was one of the biggest draws for the mall finally closes, [then] other luxury stores followed, and people didn’t want to go inside a mall during the pandemic. They preferred maybe an outdoor shopping center like Garden City or other outdoor destinations. I’m a big mall shopper myself, so I’m in there all the time. Every time I go in, another store has left.
On the chances of a new buyer purchasing the mall
Machado: The receiver told us that he had had around 50 interested parties who reached out for more information. That doesn’t mean they’re all going to put an offer in… There’s also no asking price. So, of course my first question is, how much do you want for this thing? The debt is around $260 million, so I’m sure they at least want to get something in the $200 million to $300 million range so they can pay off the debt.
The receiver says they’re not accumulating more debt, so the mall is currently covering its operating costs, but they just can’t dig out of this hole. I counted, manually, 20 empty storefronts in mid-February, and that doesn’t count the Dunkin, so now it’s 21. I don’t know what kind of offers they’re going to get, but I do think there’s an opportunity to take some of the empty space and turn it into some other use that isn’t retail and have a mixed use building with retail, entertainment, and fill-in-the-blank.
On whether the mall could eventually close down
Machado: I don’t think it’s out of the realm of possibility, but no one wants to see that happen. So I think that’s why, even a few years ago, people started talking about what’s going to happen to this mall. It’s not there yet, right? Again, it’s at 80% occupancy.
The receiver said he would like to pick a buyer in the first quarter of the year. And he then has to recommend that buyer to the court. This is all in court, remember, because of the receivership and the debt. So he would recommend that to the judge and then the judge would set a hearing. And then, I believe other buyers who didn’t get selected could come to the hearing and say, “Well, I actually think you should pick me.”
That hearing could happen theoretically, let’s say, this summer, and then a transaction could close by the end of the year. But this is totally hypothetical and dependent on whether there are even viable offers, which we don’t know yet.
On the high level of interest in the mall’s future
Machado: I just think everyone is interested in malls, right? Like, we all have this nostalgia from our childhood about being in malls. The Secret Mall apartment movie did gangbusters on Netflix. Think about where it is. It’s right in the middle of the city between City Hall and the State House. It’s so visible. You see it right from the highway when you drive by. So I think a lot of people just want to know that it isn’t going to turn into a rundown empty building in the middle of our city. And it’s not that yet, right? It’s not that yet. So how do we make sure it doesn’t become that?
