Macy's to close at beleaguered Union Station Mall

The Macy's at the mostly shuttered Union Station Mall is closing, leaving only a Sears open at the 30-year-old center.

The mall, in Union City southwest of Atlanta, was scheduled for foreclosure Tuesday. The attorney handling the foreclosure did not return several phone calls seeking comment..

Macy's employees at the mall, formerly known as Shannon Southpark, were told of the closing Tuesday, spokeswoman Melissa Goff said. About 100 people will lose their jobs, though some may be offered positions at other metro stores.

A clearance sale starts Sunday, with the final shutdown in about 10 weeks, Goff said. Macy's owns the property and will try to sell it, she said.

Goff said the closure is one of three nationwide and part of an annual process to prune out underperforming stores.  Goff would not give any details about the performance of that Macy's location, or say whether the mall's troubles triggered the decision.

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Power at the mall was cut off in November after the owner, real estate investor Lee Najjar, failed to pay an electric bill.

Najjar, who locally became known as “Big Poppa,” Kim Zolciak's benefactor on the Bravo reality TV series "The Real Housewives of Atlanta," said he bought the mall about eight years ago when it was already struggling.

He had hoped that tax allocation district money could help him to revitalize the aging mall, but that didn’t materialize.

“I bought a struggling mall, which is my forte',” he said.

During the recession, some tenants stopped paying rent, he said, and he had trouble working out an arrangement with Georgia Power to lower the mall’s power bills.

About three months ago, with mounting power and tax bills, he said, “I gave it back to the lender.”

Colony Capital Acquisitions, which owned the mortgage on the mall after the original lender, Alpharetta-based Integrity Bank, failed in August 2008, was due to foreclose on the property Tuesday, according to a notice published in the Fulton County Daily Report. A representative of Colony Capital, when reached via e-mail, said he was not familiar with the property and he did not respond with more information.

Najjar, who renamed Union Station a few years ago, said the mall would have thrived had his plans gone through. He called returning the property "a dishonor."

"My integrity is to help people and I have always helped people all my life," he said. "It was to me like a dishonor not to keep things going because that’s not me.”

Sam Latone, Co-CEO of Atlanta's The Shopping Center Group, said he does not remember another mall closing in metro Atlanta, though it has happened in other cities, such as Montgomery, Ala.

"I think it was a function of having better shopping opportunities," he said.

The mall, built in 1980, died over time, Latone said, as other malls and shopping centers pulled from its base.

Susan Wachter, a professor of real estate at the Wharton School at the University of Pennsylvania, said a mall foreclosure especially hurts a city's tax base. The loss of jobs also hurts, she said, and police departments have to patrol the vacant property.

On the other hand, a closure can provide opportunities for redevelopment, Wachter said.

The 130,000-square-foot Macy's at Union Station opened as a Rich's and converted to Macy's in 2004.

The closing will leave Macy's with 18 locations in metro Atlanta.

The Sears, which also owns its property and is not part of the foreclosure, will remain open, spokeswoman Kim Freely said.

Wachter said there is a chance that store can still succeed.

"Sears has continued to successfully operate surrounded by relatively distressed real estate," she said. "Sears has its set of customers. People might actually continue shopping there."

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