The owner of Town Center at Cobb mall in Kennesaw was not only late in paying its power bill and property taxes, but the group is also behind on its mortgage, an Atlanta Journal-Constitution review of court documents shows.
Now the lender has stepped in, appointing a third-party to manage the shopping center. That new manager, known as a receiver, paid the mall’s back taxes this month and has stepped in to stabilize operations, according to court records and a statement from new management.
Town Center made headlines in January when power to the center was shut off for lack of payment, startling tenants who were unable to open until power was restored the next day and who had no idea of the property’s financial distress.
The lender, AFF V Noonday LP, filed an emergency motion in Gwinnett County Superior Court asking to place the property under receivership, which was granted in February.
Kohan Retail Investment Group, the national investment firm that owns the mall, is in default on its $47.6 million loan executed in September for the mall property because it failed to make mortgage payments, the lender alleges in court filings.
Credit: Taylor Croft
Credit: Taylor Croft
The power bills — which totaled more than $1.1 million — were quickly paid to ensure businesses could continue operating, but Kohan Retail did not pay the bills. Its lender advanced the money to Georgia Power in exchange for Kohan Retail consenting to a receivership, the lender says in the court documents.
More than $1 million in taxes plus nearly $200,000 in water bills have now both been paid in full through the receiver, according to county officials.
If the tax debt had not been paid by May, the county was prepared to sell the tax lien at auction, Tax Commissioner Carla Jackson previously said to the AJC.
Jackson confirmed Thursday the lien will not go to auction.
The receiver now managing the mall is Lewis Taulbee, who works for commercial real estate company JLL. Their regional marketing manager, Casey McKinley, declined interview requests on behalf of the company and issued a statement confirming their involvement with Town Center mall.
“It is important for the local community to know that Town Center at Cobb is open and ready for business, as usual, and we do not expect any operational interruptions to the mall,” the statement says. “The change in management marks an exciting new chapter for Town Center at Cobb. We look forward to serving the community and bringing fresh ideas to the property while supporting our retail partners.”
Mike Kohan, the founder of Kohan Retail, said in a brief phone interview Thursday he is “in the process of refinancing” and will be “rectifying it” within 60 days. He said the company intends to retain ownership of the mall.
When asked why the bills went unpaid, Kohan said the company did not have enough funds coming in to cover the costs.
“The mortgage was such a higher monetization that took away the funds that was supposed to be paid by the bills,” he said.
The future of Town Center mall remains uncertain. But in the past, it has faced financial hardships, worsened by the COVID-19 pandemic.
After its prior owner, Simon Property Group, fell behind on mortgage payments, Town Center mall went into foreclosure in 2021 when lenders failed to auction off the $200 million in loans. Kohan Retail purchased the mall in 2023, the AJC previously reported.
Other local malls have faced financial challenges in recent years, including North DeKalb Mall and Mall at Stonecrest. Others have undergone or are planned for redevelopment.
The national decline of regional shopping malls was underway because of the rise of online shopping and accelerated by the pandemic.
Several other malls owned by Kohan Retail have suffered utility shutoffs and closures as well, the AJC previously reported.
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