Shenango Valley Mall under new ownership

Aug. 10—HERMITAGE — City officials' vision for Shenango Valley Mall as the cornerstone of its Town Center development is one step closer to fruition with the announcement Wednesday of the shopping center's new ownership.

In a release issued Wednesday, the City of Hermitage announced that Butterfli Holdings LLC, an affiliate of Pepper Pike, Ohio-based FLICORE LLC, has purchased the mall property from GFM-23.

GFM-23 is comprised of descendants of George F. McConnell, the original property owner.

The group took direct control of the mall property in 2019, after the Mercer County Court of Common Pleas ended the ground lease between GFM-23 and Iowa Square Realty LLC, the final ground lessee.

The sale was a bittersweet moment for Matt McConnell, a spokesperson for GFM-23 and chairman of the Mercer County Board of Commissioners, since this will mark the first time in about 80 years that the McConnell family is not involved with the property.

That connection began in the 1940s, when Matt's grandfather, George F. McConnell, started a farm on the property. The Shenango Valley Mall was built in the 1960s.

However, Matt said he and the members of GFM-23 found a "very responsible party" in FLICORE, whose members are familiar with the Shenango Valley Mall's situation and are expected to bring beneficial things to the mall and the community.

"It has been a great 80 years, from the time horses and cattle were raised there to seeing the emergence of the commercial area of Hermitage to the renewal or renaissance that I'm sure will happen there," Matt McConnell said.

The redevelopment of the Shenango Valley Mall property is a major component of a city center being developed by Hermitage officials.

The concept of a mixed-use city center was one of the primary recommendations of the "Hermitage 2030 Comprehensive Plan," a guide for future development in the city.

Despite the mall property being a key part of the planned city center, the property is currently in disrepair and the mismanagement of absentee mall operators prior to GFM-23 exacerbated the situation, the release states.

Shenango Valley Mall lost anchor stores Macy's and Sears in 2017, severe blows to its ability to attract shoppers and tenants.

The declining property value and store vacancies have resulted in multiple reappraisals, causing real estate tax losses of more than $240,000 per year to the city, school district and Mercer County, the release states.

The development of the city center and the mall property is expected to be a partnership between the city and FLICORE, since success stories of similar undertakings rely on a "strong public-private partnership."

City officials have secured funding to aid in the redevelopment project, through a strong working relationship with state Sen. Michele Brooks and state Rep. Mark Longietti, the release states.

"This is great news for the City of Hermitage and surrounding communities. The city looks forward to working with the FLICORE team and supporting their efforts to revitalize the 54-acre site," Hermitage City Manager Gary Hinkson said in the release.

President Duane Piccirilli of the Hermitage Board of Commissioners also commented on the purchase's benefits for the city.

"The City of Hermitage is committed to supporting FLICORE in their efforts to reinvest in the site and restore the tax base which has been eroded with the demise of the shopping center," Piccirilli said, and added "The board endorses a proactive approach to address this challenge."

A major hurdle for attracting developers to the mall over the past few years was a legal battle between GFM-23 and JCPenney.

A 1967 agreement originally signed between JCPenney, the McConnell family and Crown Construction Co., who built the mall, gave JCPenney a say over any development at the Shenango Valley Mall.

In 2019, after GFM-23 had retaken control over the mall, JCPenney officials argued their privilege under the 1967 agreement was still valid, despite a series of agreements and extensions signed since then — some of which the McConnells or GFM-23 weren't parties to.

Common Pleas Judge Harry J. Knafelc eventually ruled in favor of GFM-23 early this year. At the time, JCPenney officials stated they would consider their options, including filing an appeal.

William McConnell, who represented GFM-23 in the case, said briefs had been submitted to the state Superior Court. He was unsure when the oral argument would be or how long it would take the court to schedule an oral argument.

But like Matt, William said he was optimistic for the mall's outlook following the sale to FLICORE.

"I'm confident they'll be able to develop and redevelop the property in a way that we can look back and be proud of," William said.

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