Canyon-Johnson Urban Funds has agreed to help recapitalize Everett Mall and The Commons shopping center in Federal Way, the company said Wednesday. The amount of money being invested was not disclosed. Both malls are owned in part by Steadfast Companies, which defaulted on a $98 million Everett Mall loan last March. Irvine, Calif.-based Steadfast owns two-thirds of Everett Mall.
"We are confident that the infusion of capital at this critical time for both regional malls will help them achieve their potential," Bobby Turner, Canyon-Johnson CEO, said in a statement. "These are exceptional retail assets."
Canyon-Johnson is a joint venture between Canyon Capital Realty Advisors and Earvin "Magic" Johnson, former Los Angeles Lakers basketball star. The private equity firm has invested $4 billion in urban revitalization projects over the past decade.
Facing foreclosure on Everett Mall last summer, Steadfast said it was devising a long-term redevelopment plan for the 800,000 square-foot shopping center, though it declined to detail plans for the mall.
In 2004, Steadfast paid $50 million to buy Everett Mall after the mall's previous owner, Titanic Associates, defaulted on a loan in 2000. Steadfast quickly pumped more than $30 million into renovation and expansion, overseeing the addition of Regal Cinemas Stadium 16 theaters and attracting Best Buy and TJ Maxx to the outer mall's buildings.
Last summer, Lisa Whitney, Steadfast vice president, acknowledged the mall had not been "immune to the proliferation of retailer downsizing, bankruptcies and the subsequent vacancies that have occurred industry wide" since the 2008 economic downturn.
Everett Mall has struggled to keep one of its large anchor storefronts filled. Late last year, the mall began construction to accommodate Burlington Coat Factory in the spot previously occupied by Steve & Barry's and, before that, by Mervyn's. Both retailers closed due to bankruptcy. Burlington Coat Factory will open this fall.
The renovation for Burlington Coat Factory was made possible by the investment from Canyon-Johnson, a spokeswoman for the investment firm wrote in an email Wednesday. However, the agreement between the two was not finalized until recently. Party City and ULTA Cosmetics also are opening retail stores in Everett Mall as part of the Canyon-Johnson project.
"Canyon-Johnson has a great track record of investing in urban retail centers, and we look forward to delivering results that will achieve a complete repositioning of these two properties that have enormous upside potential," Steadfast Chairman and CEO Rod Emery said in a statement.
This is the second time Canyon-Johnson has worked with Steadfast. The two firms first teamed in 2010 to remodel and reposition the Brea Plaza Shopping Center in southern California.
"With Canyon-Johnson's involvement, we have the resources to bring new shopping, dining and entertainment options to both properties" Steadfast's Emery said in a statement.
Steadfast had not returned requests for additional information.
Michelle Dunlop: 425-339-3454; email@example.com.