IOWA CITY — Officials with Iowa City Marketplace have requested more time to complete some work and achieve occupancy levels they agreed to more than three years ago when the city provided the shopping mall with a $1.75 million tax increment finance rebate.
The Iowa City Council on Tuesday will discuss a request from Iowa City Marketplace — formerly known as Sycamore Mall — to amend and extend a developer’s agreement approved by the council in November 2014.
In that original agreement, funding was provided to reinvest in the area and help the marketplace secure an anchor tenant.
In the 2014 agreement, mall officials had until Nov. 1, 2017, to invest at least $4.4 million in improvements to the space and ensure that at least 75 percent of the building’s retail space was occupied. The property also had to see its assessed value increase by at least 15 percent and timelines were provided for the completion of interior and exterior renovations.
According to city documents, Iowa City Marketplace as of November 2017 had failed to complete all interior remodeling, facade improvements and landscaping and parking lot upgrades. The retail occupancy — which was at about 60 percent in 2014 — also had not reached 75 percent, as agreed.
Marketplace officials have approached the city for an extension, explaining that the delay in completing the tasks was due to ongoing negotiations with Joann Fabrics, which will become a tenant May 10. The mall’s occupancy rate will be at least 80 percent at that point, according to city documents.
The current Joann Fabrics store is located at 1029 S. Riverside Dr., at the intersection of U.S. Highway 6 and State Highway 1.
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If approved by council, the amended completion date for the remaining upgrades and occupancy rate will be moved to July 1 of this year.
The marketplace saw its value plummet following a spree of retailer departures — most notably department store Von Maur’s move to Iowa River Landing in Coralville in 2013 — from $16.4 million in 2011 to $10 million in 2014.
An estimate based on property valuation shows the mall’s tax contribution declined from $669,778 in 2011 to $367,803 in 2014.
Meant to serve as a new anchor tenant, Lucky’s Market opened in the former Von Maur space in 2015.
The mall’s property valuation has since increased to nearly $11.9 million last year, marking a more than 18 percent increase.
The council will meet at 7 p.m. Tuesday at Iowa City Hall, 410 E. Washington St.
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