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Real estate firm owing money on Channelside wants to take over Boston's Faneuil Hall retail complex

The New York real estate firm that already faces financial trouble paying back rent and maintaining Tampa's Channelside Bay Plaza ( photo, left) wants to take over Boston's famous and historic Faneuil Hall Marketplace in the next few months, the Boston Globe reports today. The Tampa Port Authority last year filed a lawsuit against Ashkenazy Acquisition Corp. that accused it of owing more than $300,000 in back rent and failing to adequately maintain the Channelside retail complex. Ashkenazy lost control of Channelside last fall. The retail center is now for sale. This spring, Ashkenazy also had to give up its stake in the Shops of Grand Avenue in Milwaukee after defaulting on a loan, the Globe story says. Read more here.

Sprawling on 6.5 acres, Faneuil Hall Marketplace (see exterior, right, interior, below) attracts more than 18 million visitors annually. But merchants there want Boston city officials to scrutinize Ashkenazy and consider other potential buyers for the retail and restaurant complex. The city owns the marketplace and leases three of the four buildings to General Growth Properties. The Chicago mall operator recently struck an estimated $140 million agreement to sell that lease to Ashkenazy, according to the Globe.

Michael Alpert, president of Ashkenazy, told the Globe that Tampa's Channelside and the Milwaukee shopping centers were the only problematic sites in its $5 billion portfolio of more than 100 properties. He described those two retail venues as "overleveraged assets in troubled markets."

Brenda McKenzie, director of economic development for the Boston Redevelopment Authority, told the Globe the city has reached out to people in Florida, Wisconsin, and other communities to talk about their experiences with Ashkenazy. "It is concerning,"' McKenzie said of Ashkenazy's track record in Tampa and Milwaukee. "But in real estate we have to look at the current times. We still have an open mind as we do our due diligence.''

According to the Boston newspaper, some merchants in Tampa said they heard the same promises of partnership and investment from Ashkenazy when it acquired the Channelside Bay Plaza lease about five years ago.

"In the beginning, Ashkenazy was very excited about buying the center and talked about partnering with tenants. But they never did anything to make it happen," Guy Revelle, who runs two restaurants, a dueling-piano bar, and a bowling alley at Channelside, told the Globe. "All Ashkenazy looked at was the bottom line. They didn't do anything to drive sales or improve the property."

Read more about the state of Channelside here.

-- Robert Trigaux, Business Columnist, St. Petersburg Times

Posted by Robert Trigaux at 9:58:54 am on May 19, 2011