By Tim Leeds
The Havre Holiday Village Shopping Center has new ownership as of 1:30 p.m. Thursday, Jan. 11.
Security National Properties (SNP), with corporate headquarters in Eureka, Calif., purchased the property from the Ocwen company for an undisclosed price.
"We bought the Havre mall, That's terrific!" Fred Griffith, senior vice president of acquisitions and development for SNP, said yesterday.
Griffith said SNP specializes in buying distressed properties and turning them around. He said it usually takes about 18 months to start seeing major improvements, but thinks things will move faster in Havre because the shopping center is more dysfunctional than most.
"I anticipate it will be 80 percent full by Christmas and completely full in 18 months," he said.
He said there will probably be cynics who think SNP is just "Crying wolf," but that their work will speak for itself.
"We are really here," Griffith said, "we don't expect you to believe us (at first)."
He said their record also speaks for itself. Griffith said SNP owns more than 2 million square feet of property, including 15 or 16 major retail centers, and they have pretty well filled all of them and made them profitable. He said they own a mall in Pierre, S.D., where the situation is very close to Havre's and the Holiday Village here, and have filled it. He said he is confident that they can make the Havre shopping center profitable as well.
He said their analysis of the Havre area gives them confidence that they can fill the Holiday Village. He said with the university, railroad, agriculture and government in the area, it has a good base. He said they realize the economy is not doing that well right now, but that they feel it has bottomed out and has no way to go but up.
"We think Havre has a very, very bright future," Griffith said. " I like these areas because there's real people, real people to manage them."
He said another reason they like to buy property in remote areas is because it's more difficult for people to come into the area to compete with them.
He said the first thing SNP does when they buy a retail property is fire the management company and form a new local management company. Tiffany Korb, who managed the shopping center for Westfield Properties, Inc., the management company hired by Ocwen, is now the head of T. K. Management Company, effective this morning.
"She's a queen and this is her castle," Griffith said. "She's in charge. This is her last day as an employee; tomorrow she's an employer."
He said they have found that giving local control for day-to-day operations has been the best way to run these shopping centers.
Griffith said they are already in contact with prospective tenants for the shopping center. He said they will hit Montana hard looking for people to open new businesses, as well as national chains. He said almost any business is possible as a new tenant.
"I think they're starved for retail here," he said. "I think they need everything."
Part of the problem with the distressed malls they buy, he said, is they are usually too large for the area they serve, and the rent is too high. He said since they were able to buy the property at a fraction of its actual value, they will be able to offer much better deals on rent at the shopping center.
Griffith said the shopping center is probably too large for the area, and they will probably have to rent some of the space to businesses other than retail, such as office space or storage space. He also said they are willing to make any changes they need to make money.
"If the area can't support a 3,600 square foot anchor," he said, "we have no problem with putting up a dividing wall an making two 1,500 square foot stores."
Griffith said they need to make the property profitable before they look at making general improvements, such as landscaping the parking lot.
"We have to stop the bleeding first," he said.
He said they are in the business to make money, and will do whatever it takes to make money. He said they are not in the business of buying property for a quick resale.
"We don't buy property to flip," he said. "We buy it for the long term hold where else can we make 15 to 20 percent return?"