The new owners of the Towne Mall have bought the adjacent former Dillard’s anchor property for more than $1 million, which the investors say helps them with their development plans and shows their commitment to the project.

Bless Properties LLC, a real estate holding company, bought the Dillard’s store property, 3455 Towne Blvd., in November. The purchase consisted of approximately 8 acres, the building and parking lot for $1.2 million, according to the record of the sale with Warren County Auditor’s Office. The property was last appraised by Warren County for $2.3 million.

Dillard’s closed the department store there in 2008.

Bless Properties is related to the business entity SA Mary Ohio LLC, both of which are owned by the same California-based investment group.

In October, Bless Properties bought for $850,000 the Towne Mall property, 3461 Towne Blvd., according to county auditor records. That property, 13.7 acres and the building, was last appraised for $3.7 million.

“The Dillard’s property, being vacant, prohibited the mall growing and attracting bigger tenants,” said George Ragheb, one of the California owners/investors.

“However, with the Dillard’s property in our possession, it will give us an opportunity to orchestrate a new tenant strategy to bring in the right tenants to the Dillard’s property that will consequently attract the right tenants inside the mall,” he said.

The investors and owners are focused on finding a tenant for the Dillard’s property as fast as possible to increase the ability to lease retail space in the mall, Ragheb said.

“This project will require a huge infusion of cash which we are prepared to invest,” he said.

Ragheb also said the group is renewing the lease with The Performing Arts Academy at Towne Mall, a nonprofit for music education and performing arts.

“The mall is perfect for us. This year we’ve had 6,127 guests come to our shows this year,” said Nina Markle, executive director of the arts academy. “They seem to be trying to work with people in the mall. They are certainly trying to work with us.”

On the day Dunham’s Sports — one of the larger remaining tenants at the Towne Mall — closed its doors for the final time, the shopping center’s new owners said they plan to invest between $20 million to $25 million renovating the entire 465,451-square-foot property.

The mall will probably undergo a name change, too, they said.

The Towne Mall, which opened on Ohio 122 near Interstate 75 in 1977, was purchased by SA Mary LLC and Bless Properties LLC, for $850,000 in November 2012. The California-based investors acquired approximately 8 acres, the Dillard’s department store site — a former mall anchor that closed in 2008 — and parking lot for $1.2 million, according to the Warren County Auditor’s Office.

Once deemed a dead mall, Towne Mall is the city’s front door and redeveloping it into a viable shopping option is important to Middletown’s image and future development in the East End, city officials have said.

George Ragheb, one of the investors, said the $20 million to $25 million investment includes the property purchases and renovations to the 13-acre mall property, including subdividing the Dillard’s site. He said much of the cost will be building new walls, installing heating and air conditioning units and bringing the mall up to 2013 codes.

Ragheb said he hopes to have some of the construction done and new tenants in place early in 2014. And though the larger sign still reads “Towne Mall,” he said the mall’s name also will change.

The mall is currently being marketed as The District at Middletown, but the group is considering the name Middletown Galleria.

He also said the mall’s owners are negotiating with several “very significant tenants.”

Trisha Hale, general manager of the Towne Mall, said three new tenants have signed leases at Towne Mall — two retail businesses and one restaurant, though she refused to name them.

The progress the mall has made since it was purchased three months ago is “mind boggling,” Ragheb said.

On Tuesday, Dunham’s Sports, a tenant at the mall for the last 10 years, closed. Ragheb said the lease had expired, and the owners of the Michigan-based sporting goods store and the mall couldn’t reach an agreement on a new lease.

Saying he was “hungry, not desperate,” Ragheb refused Dunham’s lease offer.

He said Kay’s and Roger’s, the mall’s two jewelry stores, and Bath and Body Works have renewed their leases, and by Friday he expects to announce that another national chain, a current mall tenant, will renew its lease for one year. He refused to name the retailer.

The mall has added six businesses, and four more have signed leases, while one, Dunham Sports, decided not to renew its lease, said Trisha Hale, mall manager.

While the economic news coming from the Towne Mall is positive, it needs to find several tenants to occupy its largest available space, the 111,696-square-foot former Dillard’s location, said George Ragheb, one of the investors for SA Mary LLC, a California based group.

He said the 465,451-square-foot mall hopes to sign three to five national tenants to fill the former Dillard’s site. Ever since Dillard’s closed, the mall has had two anchor stores — the 63,106-square-foot Sears and 117,888-square-foot Elder-Beerman.

Ragheb said mall management is “75 percent down the road” toward signing what he called the “right tenants, major tenants.” He said they’re considering nine potential tenants. Ragheb refused to name any of them until the contracts are signed.

He said the interest from retailers shows “people believe our story.”

Plans call for the owners to give the 36-year-old mall a face lift that will cost between $20 million to $25 million, he said.

Eventually, he said, the mall will become “a true shopping destination” for Middletown residents and those from neighboring communities.

That probably won’t happen, though, until the major tenants open. The new businesses mainly are specialty shops or restaurants, and while they have “strong followings,” Hale understands the financial weight anchors carry.

“You have to have a great mix of tenants,” Hale said. “That’s what you need for a winning mall. It has to become a destination, a place to go.”

Hale said she hasn’t seen this much excitement in the mall in years. She said the “whole mood” has changed in the East End.

Gail West has been in the clothing business for more than 3o years and she works at Worthmore in the mall. She said the mall is taking “baby steps,” but she sees additional foot track, a sign business is improving.

“It seems to be drawing people back,” she said.

One of the new businesses that is enjoying early success is Miss Selby’s Soap and Such, a store that offers all locally-produced products — from Renee Selby’s candles and soaps to jelly and jams from Lebanon to LaCrema Coffee from West Chester Twp. to Fenno Fashions from Cincinnati to Waggoner Chocolates from Canton.

Carolyn Centers, who works at the store, described business as “better than we thought.” She said in just the few weeks it’s been open, she’s is seeing more and more repeat customers. She said people like purchasing all natural, local products.

Centers also sees a bright future for the mall, and that certainly wasn’t always the case. When the Middletown native, who lives in Cincinnati, visited the Towne Mall months ago before it was sold, she said the vacant stores “broke my heart.”

Now, she said, “I see progress and that makes me excited.”

NEW BUSINESSES

Six businesses have opened and four more have signed leases since Towne Mall was purchased last year by a California-based investment group, according to Trisha Hale, mall manager.

Now open:

All About You Catering and Bakery

Splattered Platter

Miss Selby’s Soaps and Such

A.L.M. Team Sports

Wigs for a Change

My Gadget Solutions

Coming soon:

Yanni’s Greek Gyros

Ice Ice Smoothies

Home Connection

Gameland

Now closed

Dunham Sports

Staying with the story

The Middletown Journal has reported the major developments at Towne Mall since it was purchased last year by a California-based investment group. You can count on the Journal to continue to report new developments and how they impact the local business community.

Don Craven and Joe Cox expanded their business, Home Connection, a home decor store, into the East End mall earlier this month.

“We were looking at other locations and heard about the mall,” said Craven. “I was hoping it might work out because it’s hard to find an independent little shop to set up.”

Home Connection mostly sells prints and American made and crafted frames along with other country-style and craftsman-style home decor at their store across from the Family Christian Bookstore. They manufacture the frames in their West Chester Twp. warehouse.

Each man got into the business for his own reasons. Craven had “always wanted to have a little business of my own,” while Cox “wanted to do something I enjoyed.” Both men had worked and retired from other careers before crossing paths.

The store is part of the nearly 20 percent growth in occupancy since SA Mary LLC, a California-based investment group, purchased the struggling mall. Seven stores have opened in six months, including Home Connections on May 1. Three more businesses have signed leases. And the 36-year-old mall is to undergo $20 million to $25 million worth of renovations, according to plans announced by the owners.

And all of this in the past six months has created a buzz that Craven and Cox said they are seeing in the mall. More and more people are coming to Towne Mall, they said.

“We understand that they’re trying to fix it up, and I thought this was a great opportunity,” said Craven. “It will take off like everybody’s expecting.”

Home Connections is open 10 a.m. to 9 p.m. Monday through Saturday and noon to 6 p.m. on Sunday. For more, call 513-422-1953 or email homeconnections1953@att.net.