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McClatchy-Tribune  04/27/2014 12:07 PM ET
Turnaround specialist gambling on moribund Burlington mall's revival [The Philadelphia Inquirer :: ]

April 27--The former Burlington Center Mall, now the Marketplace at Burlington, hasn't been right for a long time -- it's a shell of what was once a healthy retail center and community draw.

Now, there are not only random vacancies of gated storefronts, but whole swaths sitting dark and empty. On any given weekday, security guards easily outnumber shoppers.

Even on a recent Friday at 5:30 p.m., after the work and school day, it was dead. A half-dozen people sat in the food court and a sprinkling of shoppers walked around.

The mall has a vacancy rate of 55 percent, far surpassing the national average for U.S. malls, and for a venue that once housed 100 tenants when it opened in 1982, half have left. Starting next Sunday, the mall will have only one anchor store, Sears. JC Penney closes for good on Saturday -- joining Macy's, another key anchor that pulled out in March 2010.

From his dual perch in Las Vegas and New York, all the trouble signs got the attention of Steven Maksin, 46, a mall turnaround specialist who loves a challenge as much as making money. Like picking stocks, he spots underperforming malls, buys them cheaply with cash, pumps money into reviving them, and waits for a return on his investment.

He has had success with malls and shopping centers in Texas and Colorado.

"I was intrigued," Maksin said of the beaten-down mall that sits off Exit 47A on I-295 in Burlington Township. He then ticked off every developer's dream: access points (it's near I-295, the New Jersey Turnpike (Exit 5), and Route 541; great demographics (population and household income); and traffic, lots of it.

"He buys these things dirt cheap, because if it was just the land, it wouldn't be that cheap," said Charles Swain, president and principal of Colliers International Real Estate Management Services in Atlanta, who met Maksin last month when the landlord and investor was on an economic development panel.

Maksin bought a Georgia mall last year. "He buys a property that's still generating cash flow, and waits to see what the community needs before he makes his move," Swain said. "I wish I was a risk-taker like him."

Maybe it's because Maksin's company -- Moonbeam Capital Investments L.L.C. -- is based in Las Vegas, where the term all in is commonplace. But Maksin is definitely all in, to the tune of $230 million, on top of the $4.4 million he paid to acquire the mall in late 2012.

Starting next spring, here's what Maksin says to expect: a complete face-lift of the mall's facade; 1.2 million square feet of retail added to the existing 300,000 square feet; the development of a "hybrid mall" that combines a traditional, indoor mall with an outdoor, lifestyle center for shopping, dining and entertainment, including a Dave and Buster's-type family center, and a hotel. Throw in some water fountains and benches to rest on in between purchases or while waiting for your reservation at the dozen new restaurants.

When you have 150 acres, and an additional 50 acres of "green space" to work with (some of which belong to the Hovnanian family of Philadelphia), the sky's the limit, said Maksin, Moonbeam's chief executive officer. Full build-out is expected to take two to five years and to be done in stages. The mall will stay open the entire time of construction.

"This will be one of the largest and most exciting projects on the East Coast," Maksin said last week from Las Vegas. "And most successful."

Moonbeam, a private equity fund that has no debt and doesn't have to answer to investors, has been on its own shopping spree of late. Last year it bought four failing malls -- Gwinnett Place Mall in Duluth, Ga.; one near Pittsburgh, called Century III; Shoppingtown Mall in Syracuse, N.Y.; and the Cortana Mall in Baton Rouge, La. In addition to nine malls, the company also owns 14 strip centers throughout the nation, including the Shops at Pennsville Center in Pennsville, Salem County.


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