Chattanooga’s first suburban mall has a new owner.
A Fayetteville, Arkansas-based real estate investment firm has acquired the 64-year-old Highland Plaza shopping center at Hixson Pike and Ashland Terrace as national investment groups continue to invest in the market of Chattanooga.
The Fletcher Bright Co., which has owned and operated the Hixson Mall since 1994, sold the 129,000-square-foot mall last month for nearly $8.9 million, or nearly $69 per square foot.
The mall is anchored by a Walmart Neighborhood Center, which was previously sold by Fletcher Bright, and includes a Big Lots, Dollar Tree, Tuesday Morning and Farmer’s Furniture as well as a CHI Memorial Medical Clinic.
A real estate partnership created by Core Equity in Fayetteville bought the mall with an investment partnership known as Core Highland Plaza LLC to expand into what company officials see as a growing retail market in Chattanooga.
“Chattanooga is a secondary market that we’ve had on our radar for some time,” Drew Angel, managing partner of Core Equity Partners, said in a property purchase announcement. “We are excited to add this to our portfolio.”
The Fletcher Bright Co. helped upgrade and fill most of the shopping complex, which had a number of vacancies after the original tenants left. In 2015, a Walmart Neighborhood Market opened in a former Food Lion location. Then, two years ago, Farmers Home Furniture, one of the fastest growing retailers in the South, opened a 27,000 square foot store in Highland Plaza.
George Bright, president of Fletcher Bright Co., said now is the time to sell with many outside investors interested in buying in Chattanooga and property values are rising.
“The commercial real estate market right now is extraordinarily strong, and if you’re not selling when the market is strong, when are you going to sell?” Bright said in a phone interview Monday. “We were able to attract strong tenants and fill Highland Plaza, which also makes it an attractive property.”
Highland Plaza’s first tenants when it opened in 1958 included Miller Brothers department store, JC Penney (which moved to Northgate Mall in 1972), Woolworth’s, WT Grant Co., Miles Shoes, Gordon’s Jewelers, Miller Jones Shoes and Kroger , according to Sam Hall, a local history buff who runs the ChattanoogaHistory.com website.
“Highland Plaza has been one of those viable malls since the 1960s,” Angel said. “Its endurance speaks to fundamentals and market position.”
Highland Plaza is Chattanooga’s third suburban mall sold this summer to investment groups looking to invest in more secondary retail markets like Chattanooga in the South.
In June, Fletcher Bright Co. also sold a Lookout Valley shopping center for $7 million to an international investment firm, Alea Properties, which manages offices, medical practices, retail and industrial properties in a half a dozen American states and has foreign interests in Australia and Africa. This center comprised nearly 10 acres and 49,000 square feet of retail space near the Walmart superstore on Cummings Highway in Chattanooga.
Also in June, Chattanooga developer Bassam Issa sold the Issa Crossing Mall on Highway 153 to an Ontario, Canada-based investment group for $10.75 million. The 117,000 square foot mall is home to a Gabe’s discount store, Ollie’s Bargain Outlet and Barton’s Home Outlet. Issa had developed the mall after buying a closed K-Mart store, which closed in 2016.