MALL STALL

‘I’m not playing games any more’ … One tenant’s all-out battle with a Kohan-linked mall

Michigan retailers cite mall neglect, question owner motives

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BENTON HARBOR, Mich. Four glowing words pierce the Michigan dusk. “Like us on Facebook.” But here at the Orchards Mall, traffic cones block a main entrance, sending a not-so-social message to people on Napier Avenue.
Keep driving.
When I tell retailers I’m investigating conditions at Kohan Retail Investment Group malls, a few have taken a breath and asked: What’s it like out there?
Marginally, better than here in Benton Harbor, Mich. Few properties struggle quite like the Orchards Mall, a place beset by flocks of nesting seagulls. And by other flights too including its last anchor tenant, J.C. Penney.
A dozen or so merchants hang on, but this once-busy, once-proud mall appears to be on its last legs. It’s a far cry from opening day, when the developer, Westcor, handed out 3,000 free T-shirts in an hour, Miss Blossomtime cut a ribbon and the Berrien County newspaper headline would trumpet: “Orchards Mall Opening Berrien’s Biggest Ever.”
It kicked off with 36 stores, with hopes to ratchet up to 85 when full. The mall cost $20.5 million to build and would create 430 jobs, people were saying at the time.
The county recently notified the mall it wants to remove a traffic light at one entrance. No traffic wanting in, no light.
Here in southwestern Michigan, as in Lanesborough, the clock is ticking down on a long retailing history.
“Right now it’s almost down to zero,” Bruce Hutson tells me from the chair he keeps near the front of Antiques and Such, which he manages for an ill friend, Jeff Hill. “It’s sad. We’re trying to keep going.”
Even parking lot stripes have bleached away, as curbs crumble and a stink rises from gulls marking skylights, walls and pavement below, avian Jackson Pollocks.
Some tenants believe the mall's owners want them all out so they can level the place — it sits on 72 acres — and develop a hotel. Or a strip mall. Or housing. All have been mentioned, tenants say.
“The property is worth a whole lot more than this mall is,” one tells me.
Not all tenants are ready to go quietly into that retail night. Norbert Zimpfer, the “Z” of Dr. ZZZZ’Z Mattress Center, does battle regularly with the mall’s owners. “I’m not playing games any more.”
Zimpfer, the mall’s longest non-chain tenant, is blunt about what he thinks of Mike Kohan’s roughly four-year legacy here: “I call him a slumlord. For the last four years he was taking rent and not investing a single dollar back into it. When something breaks we're just out of luck."

• • •

I sent an email to Kohan’s company asking if it invests enough in delayed maintenance. I also asked: “Do you feel you have an obligation to be a good corporate citizen in the places you do business? If so, what is an example of that?” As of Tuesday I had not heard back.
Entities controlled by Kohan owned Orchards until last fall, but may retain an interest. “Kohan is still somehow involved here,” Zimpfer says. “I heard the new owner say, ‘I have to check with Mike.’”
The mall was still identified online this week by the Kohan group as one of its 26 mall properties. That same webpage in early April listed 30 malls. Since then, four properties were removed from the roster. Not the Benton Harbor mall. I asked the Kohan group whether it remains affiliated with the Benton Harbor mall and am waiting for a response.
Zimpfer holds a 10-year lease on his space; he’s been here for 15 years. The lease is good news for him and he plans to use it as leverage, should the owners be indeed moving toward a mall knockdown.
In the last four years, life for tenants with Kohan as owner has been a kind of do-it-yourself game, but not the trendy sort of DIY. Kimpfer paid to remove trash from a section of the mall, then subtracted the cost from his rent. He paid to recharge a chiller unit on the rooftop AC. When he asked again about a recharge, he says the local company that does the work declined.
A representative told Zimpfer it was not authorized to come to the mall. He suspects it is part of a plan to make life here so uncomfortable for tenants they want out. “He needs everybody out on the cheap. I think that’s what his scheme is,” he says of the mall owners, whoever they are.
I tell Zimpfer I’d managed to find a bathroom down a dark corridor. “Was there toilet paper?” he asks. Word had spread around the mall that housekeeping was told not to replace toilet tissue.
Other local vendors will no longer work for the mall without an upfront cash payment or cashier’s check, Zimpfer tells me.  “Kohan bounced checks all day long, every single week,” he says. “They know they’re not going to get it.”
The new mall owner, Durga LLC, tried to jack up payments, according to Kimpfer, perhaps to cover taxes that Kohan still owed to Berrien County. Durga is Sanskrit for “invincible.” Its principal has been identified as Vijaya Kumar Vemulapalli.
The mall manager under Kohan, Edward Moore, told the local paper, the Herald-Palladium, that the transfer meant good things. He remains on board.
“All of us are elated. We can only go up from here,” Moore told the paper late last year. Moore said he’d been on the phone with Vemulapalli. “He’s been very proactive since the sale. He’s already delivered a front-end loader and a Bobcat for snow plowing. He bought the salt before closing as well.”

That's a good thing, because Zimpfer recalls storms that closed the place.  "Last year he didn't plow for a week so we had this much snow," he says, holding his hands a foot apart. "The customers couldn't get through."
Zimpfer says he was told by the new owner that he needed to pay for common area maintenance, a new charge. He refused.
Just look at the place, he says. “The outside looks like Berlin in 1945.” And by the way, he’s German.

• • •

Hutson, who staffs Antiques and Such, rates the mall owners harshly, though perhaps not as intensely as Zimpfer. They both use the word slumlord.
It was a sunny afternoon in Benton Harbor. Light flooded a skylight in the corridor outside the shop, showing off streaks of seagull droppings.
In the year he’s been minding the store, Hutson has grown frustrated with what he sees as the mall not doing enough for the survivors here.
“They never follow-through. How do people like that get away with what they’re doing?” he asks. Ten years ago, maybe 15, people still came to this mall, Hutson tells me. “You couldn’t hardly get in here with all the activities. Now, it’s down to 20-30 people a day. It’s sad to see a thriving business running right down.”

Barb Shaw needed more space for her shop, Nakita’s Consignment, located not far away on Colfax Avenue. She moved a year ago into the Orchards, but even at the start had her doubts. The food court seemed moribund. The seagulls worried her as well. “It was a Hitchcock-looking thing,” she says, thinking of the director’s movie about angry birds. “Should I get out, or what?”
Undaunted, Shaw moved in. The shop is stuffed with apparel, jewelry even housewares in the back. A little of everything. She named it for a granddaughter and got into this business a few years ago after retiring at 62 from a career as a bookkeeper. In retail. That background gave Shaw a head start on running the numbers that come through her register.
They are small numbers. As we talk one afternoon a teenager comes in bearing a tray with a single plastic-wrapped brownie. How much? Shaw asks. He tells her $2.50. She walks around the counter, punches a button on the register and pulls out two bills and coins.
“About what I took in today,” she says to herself.
Today, Shaw seems tired of the whole enterprise. “I like doing this but I don’t want to get bogged down,” she says.
It might be different if the place was on the upswing. Shaw wishes mall managers were putting up more of a fight to renew retailing, perhaps by promoting the tenants they have.
“I don’t think the chain stores are coming back. That’s my problem,” she tells me. “If they’re not coming back, let’s promote what we have now.”
“I saw it going down,” she tells me. “It’s going to be dead. Dead.”
Another recent arrival, Vanessa Bustamante, saw the warning signs, just as Shaw did. But she also took the leap.
Bustamante is from South Bend, Ind., an hour down the road, where her mother runs a business. Her husband grew up in Benton Harbor and remembers hanging out at the mall as a child.
Last fall, Bustamante came up to the Orchards to sell things at a flea market and did OK. She noticed that the old food court was not in session, so to speak. Two months ago, encouraged by her mom, Bustamante opened T.T.T. Little Kitchen, specializing in Puerto Rican food; she is now one of two food sellers.
Bustamante pays $600 a month in rent, plus $90 for utilities. She likes being near a door, but there wasn’t much foot traffic in the time I spent there. If people try her food, Bustamante is confident they’ll come back. “We’re very hopeful. Every time people come in I get happy. We’re making ends meet, but we’re not making money. As long as I can make the rent right now, I’m good.”

• • •

At the other end of the mall, I find Tony Martin waiting for customers at Kustom Tattooz. The clearance sale continued next door at Penney’s.
Martin opened his shop in 2015, going it alone after working for a salon downtown. He says he’ll be out of the mall before 2020.
After moving into Kohan’s mall, Martin found his toilet wasn’t working. It still isn’t.
Heat is a problem too. A sign at the front of the shop, beside what’s soon to be the abyss of a former Penney’s, reads, “Due to the mall not providing heat, we have had to make it possible to keep as much heat in our store as possible. Come on in.”
Power is a problem too. Martin pauses, doing a silent tabulation. He then says the shop and mall lost electricity 15 to 18 times since he's been here, reportedly for non-payment by owners. Water service was shut off once. Martin has learned a lot about plumbing.
“It’s kind of sketchy because you never know whether you could come to work,” Martin says.
Customers didn’t know either.
In the winters they’ve spent here, Martin and his wife and business partner, Stephanie, have deployed space heaters — and that’s why they taped up that sign at the door, near what’s soon to be the abyss of a former Penney’s. One really cold spell this past winter, cold enough to shut schools on both sides of Lake Michigan, cost them $550 worth of ink that froze and couldn’t be reused.
In summers, with no air-conditioning, they’ve sweated things out. High temperatures may be a reality in shopping bazaars around the world, but they pose a unique problem for this kind of business, Tony Martin explains to me. “You can’t have people getting tattooed in that kind of heat.”
“We can’t let our clients use the bathroom … and we have to send them to J.C. Penney,” Stephanie Martin says.
“There’s so much wrong with this mall,” her husband adds.
Another tenant fed up with the mall’s unkempt appearance fired up a lawnmower and attacked a patch of grass.
“How can you have people coming into this place when it looks like this?” Martin asks. Those that do make it to mall doors have maneuvered around potholes deep enough that at least one is blocked off by barriers. I saw two grackles bathing there in water so deep I couldn’t see the bottom.
And speaking of birds, the seagulls can’t be seen from Kustom Tattooz, but they’re nesting by the hundreds on the roof overhead. Stephanie goes to look for a nest with eggs she was told could be seen right by the Penney’s entrance. Rumor not confirmed.
But the seagulls are real and they’re ripe. The Martins tell me that Penney’s staff were unable to open ventilation on the roof because the smell would drift down. Along with pounds of droppings, they believe the nests are littered with dead and decaying birds.
Only when the transfer to Druga LLC neared, did things start happening under Kohan, Martin says. “He did nothing with this mall until he was ready to sell.”
It doesn’t help that Martin recalls better days. His mother used to work here at Sears, when there was a Sears. He worked for Sears too and remembers the day it closed.
“Honestly, it’s quite depressing to see what the last few owners have done to the place,” he says. “It was such a great place to grow up. I was here all the time I could be. Once J.C. Penney is gone, this mall is not going to live.”

NEXT:  After letting mall developer take over part of its downtown, an Iowa city works to win it back.

Larry Parnass, investigations editor for The Eagle, can be reached at lparnass@berkshireagle.com.


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