.

City Center Sold as a Foreclosure after Owner Defaults

TNHYIF REIV Hotel LLC purchased City Center in March for $34.7 million at a Prince William County foreclosure auction. TNHYIF is part of the New York-based True North Corporation.

A New York-based company bought City Center in March at a foreclosure auction for more than $34 million—less than half the amount it cost to build the mixed-use development five years ago.

The notes, or loans, on the two-building development on Manassas Drive were in default when Bank of America, PNC Bank and Sovereign Bank—the holders of the notes—sold them to TNHYIT REIV Hotel LLC on Sept. 14, 2011, according to a corrected trustees deed filed on April 5.

Clark Realty Capital, the original owner and builder of the property, defaulted on the loans, pushing City Center into foreclosure and onto the public auction block in Prince William County, where TNHYIT—part of the True North Management Group—purchased it for $34.7 million, according to court documents.

That’s a loss of about $22 million for Clark Realty Capital because it borrowed a total of $56 million in construction loans from three different banks to complete the City Center project in 2007, according to Manassas Park officials.

City Center, also known as Park Center LLC, was proposed as the first major component in developing a vibrant downtown area for Manassas Park. But within the last three years, the entire project— especially the retail component—has come to be viewed as a failure.

As a result, it is the subject of resentment, frustration and anger among Manassas Park residents and officials. No retail businesses have ever occupied a single space in the building. Alliance Bank does occupy one parcel, but that was part of an agreement because its original location had to be demolished to build City Center, according to city officials.

Some residents directed their anger at the City of Manassas Park because they believed its employees and council members were somehow responsible for the lack of retail, Manassas Park City Attorney Dean Crowhurst said this week.

City officials said many businesses courted Clark Realty Capital for retail opportunities but were turned down for one reason or another. Some of those businesses ended up on the newly developed Liberia Avenue in Manassas, Crowhurst said. City officials and employees even hand-picked certain businesses and encouraged their owners to set up shop in City Center, but things never worked out, Crowhurst said.

Councilmembers said they asked Clark Realty Capital officials on several occasions why there weren't any businesses in City Center, but said they never received a clear answer from anyone within the company. 

Tim Alexander, a representive of Clark Realty said in a previous report that the economy bust and the development on Liberia Avenue stymied the growth of City Center.

Anyone who contacted Clark and inquired about the City Center got a call back and information, Alexander said.

Clark officials weren't immediately available for comment this week.

City Council members who were serving during the planning phase of City Center wanted it to have a “sit-down” restaurant and other thriving businesses in the complex. Councilman Brian Leeper declined to comment on Clark Realty’s businesses practices pertaining to City Center.  

“As I was once told, if you can’t say something nice—don’t say anything,” Leeper said.

He believes True North purchased the property with the intention of effectively marketing and managing the retail component, Leeper said.

The Lane Company is employed by True North to manage the residential portion of City Center.

Some residents of the two buildings said they were aware of the managment change but didn't know about the foreclosure.

True North will hire a second company to manage the retail space for rent on the first level of the complex, Manassas Park City Manager Jim Zumwalt said.

Allison Lightner May 19, 2012 at 04:41 PM
There are about nine or ten residential apartments on the first level that were originally going to be retail but the previous owners turned them into "loft" style apartments. I live in one of them.
Allison Lightner May 19, 2012 at 04:46 PM
Jamie, you are absolutely right. I was NEVER notified about the foreclosure and the buy out! I think they definitely should have let us residents know what was going on. I always had a bad feeling about Clark Reality and how they never seemed to do any marketing or anything to bring businesses into the retail spaces and reading this article makes sense now!!
Jason May 21, 2012 at 02:37 PM
@ Concerned Citizen "the spaces that do line Manassas Drive are already filled with cars from the train station.....Go by on any given day --and even though only the bank sits on the border of Man. Drive, there are no parking spots...weird since there are no stores that are open" ....Just put "One Hour Parking" in the each space....this will deter commuter parking....please go to fairfax corner to see how this is implemented. "that does seem pretty rude to assume people are too lazy to walk across the street........perhaps it's a safety issue" ....The Manassas Dr/Market Intersection is designed to be the one of the safest intersections in PWC/Manassas/Manassas Park. "you can't have one space for each store".... Have you ever been to Fairfax Corner or Arlington or Downtown DC?
John K May 25, 2012 at 11:43 AM
I'm a resident as well and did not hear about this foreclosure. The previous management was very poor, so it doesn't surprise me. As far as parking goes - they need to expand the parking to ever have a shot at having retail spaces in the complex. Many of the cars on Manassas Drive are not commuters, but actual residents of the City Center. I live in the building connected to the Alliance Bank and many times there are no spots available already when I come home, so I'm forced to park on Manssas Drive. Limiting the parking on Manssas Drive would inconvenience a lot of us that live there, as I know many people who are forced to park on Manssas Drive due to already limited parking. The only thing I think that would work down there right now, would be a Starbucks or something quick like that.
Jamie M. Rogers July 12, 2012 at 05:37 PM
http://patch.com/A-vXzG Check out this update concerning City Center ... good stuff.

Boards

More »
Got a question? Something on your mind? Talk to your community, directly.
Note Article
Just a short thought to get the word out quickly about anything in your neighborhood.
Share something with your neighbors.What's on your mind?What's on your mind?Make an announcement, speak your mind, or sell somethingPost something
See more »