More tax trouble for Berkshire Mall, as owner misses another payment deadline
LANESBOROUGH — The owner of the Berkshire Mall missed another quarterly tax payment Monday and is now more than $700,000 in arrears.
Berkshire Mall Realty Holding LLC has now failed to pay the first three fiscal 2019 quarterly tax payments to both the town of Lanesborough and the Baker Hill Road District, which has legal jurisdiction over the mall's property. Fiscal 2019 began on July 1, 2018.
After missing Monday's third-quarter payment deadline, the firm currently owes the town $301,130 — including $11,000 in interest — and the road district $407,082 in back tax revenue, according to the Lanesborough tax collector's office.
Michael Kohan, principal of Kohan Retail Investment Group, the mall's parent company, told The Eagle in December that he planned to settle his debt with the town and the road district by early January. In a brief telephone conversation this week, Kohan said he still plans to pay what he owes, but is currently obtaining the necessary funds.
"Yes, we're going to pay it," said Kohan, whose legal name is Mehran Kohanseih. "I'm just getting the money together. I'm behind maybe one quarter."
Asked when he expects to make good on resolving the debt, Kohan replied: "If you call me next week, I'll let you know."
Berkshire Mall Realty Holding has owned the Berkshires largest retail shopping complex since 2016.
If Kohan fails to pay what he owes the town by the fourth-quarter payment due date of May 1, the town will send him a notice demanding payment, according to town collector Jodi Hollingsworth. If that debt is not paid in full within 14 days from the sending of that letter, the town can begin the process of taking the property from Kohan by tax title.
"We will follow the process exactly the way the law requires us to follow the process," said town administrator Kelly Robbins.
Attorney Mark W. Siegers, who represents the road district, declined to comment on any plans to recover the overdue payment.
Kohan has previously missed property tax deadlines with both the town and the road district, and in December Baker Hill filed a complaint against Berkshire Mall Realty in Berkshire Superior Court seeking to recover the unpaid taxes. On Dec. 19, the court agreed to attach a debt of $276,000 to the mall's property.
Kohan did not appear at the court hearing in December and was not represented by legal counsel, according to Siegers.
"We got a letter saying he was going to pay, but we never heard back from him," Siegers said.
Kohan has missed several tax deadlines with both the town and the road district since he bought the struggling shopping complex for $3.5 million in September 2016.
In both 2017 and 2018, Kohan paid what he owned by sending large, lump-sum payments to the town shortly before the town and road district could have taken legal possession of the property. Last year, Kohan paid nearly $1 million in back-tax revenue five days before a deadline for losing legal control of the mall was to expire. In 2017, Kohan paid four days before a similar deadline ended. Last year, Kohan told The Eagle that he borrowed the money to make the payment.
The 720,000-square-foot mall, which marked its 30th anniversary in September, has struggled financially for years. The mall's four anchor stores have all left, and many smaller national retail chains have followed the bigger stores out the door.
The loss of tenant income has been compounded by the retail complex's assessed value of $19.5 million, which is more than six times larger than what Kohan paid for the entire property. That assessed value has kept property taxes high.
Business Editor Tony Dobrowolski can be reached at 413-496-6224 or firstname.lastname@example.org.
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