TAMPA — Channelside Bay Plaza is buried in litigation and cannot be sold right now.
So, of course, someone tried to buy it on Tuesday.
And by doing so he raised the price for everyone else who wants to make a serious offer.
Benjamin Mallah Sr. said he's willing to pay $7.5 million — the highest offer made public — for the dilapidated downtown mall.
The president and CEO of Equity Management Partners Inc. of Largo declared his interest in buying the mortgage to the Channelside building during Tuesday's meeting of the Tampa Port Authority governing board.
"Our company specializes in taking distressed assets and getting them back to what they should be," Mallah said.
Mallah made his pitch knowing full well that there's no process for anyone to actually buy the plaza.
The fate of the downtown Tampa property is in the hands of a federal bankruptcy judge who — after wading through what could be months of litigation — will eventually decide how the plaza can be sold and possibly to whom and for how much.
Last month, that federal judge dismissed the port's own offer for Channelside, a $5.75 million deal with the Irish Bank Resolution Corp. that would have also settled years of state court litigation between the two sides. The judge is overseeing the plaza because he has jurisdiction over the IBRC's bankruptcy case.
The judge told the bank it could get a better offer, and pointed to one made in his courtroom. The entity that sued to stop the sale, Liberty Channelside LLC, brought a $7 million certified check to court to prove that the bank was leaving money on the table.
Using the judge's own ruling, Mallah's $7.5 million offer could likely raise the price for the port or anyone else who wants to buy Channelside. It's the job of the bankruptcy judge to get maximum value out of the Irish bank's distressed assets for its creditors.
The port's board members have told the Tampa Bay Times that they're still interested in buying Channelside, even if it means spending more money to acquire the property.
But that raises the question: How much is too much for the port, which is using public funds, to pay for Channelside?
"I don't know," said Tampa Mayor Bob Buckhorn, who sits on the port board. "I would hope the judge would be reasonable in his expectations."
The mayor said the Channelside sale should be about more than just getting the best price. It should also be about finding the right buyer and developer to turn the downtown icon around and turn it into a community asset, not just add some new shops, eateries and a fresh coat of paint.
The port believes it alone should make that choice. The port also owns the land beneath Channelside and believes it has veto power over the choice of a buyer. But the port and the bank could never agree on that choice, so the port decided to buy out the bank.
But if the port still wants to take control of Channelside, they could face several bidders who might drive the price up even higher. Liberty said it still wants to buy Channelside. Another potential bidder could be Tampa Bay Lightning owner Jeff Vinik, who tried to buy it in 2012 but backed off over the threat of litigation.
Now Mallah joins that list of potential buyers.
Last month he incorporated a new entity, Channelside Retail Center LLC. He sent "letters of interest" to the port and bank. He drew up a plan for fixing the complex and attracting new shopping, retail and entertainment options, especially national brands.
He also listed his qualifications. His firm manages $185 million worth of real estate and most recently revived two distressed properties: the 40,000 square-foot Pelican Walk Plaza shopping center in Clearwater Beach and the Bay Harbor Best Western Hotel in the Rocky Point area of Tampa.
Mallah partnered with former pro wrestler Terry "Hulk Hogan" Bollea to open Hogan's Beach, the restaurant filling the old Crabby Bill's spot adjacent to the Bay Harbor hotel.
Despite the many legal issues clouding Channelside's future, Mallah said that didn't deter him from announcing his interest.
"So what?" he said. "That's life."
Times news researcher John Martin contributed to this report. Jamal Thalji can be reached at (813) 226-3404, [email protected] or @jthalji on Twitter.