New owners of Annapolis Fashion Festival are trying to put the financially troubled strip shopping center back on track, although poor sales have continued to drive merchants out.
Festival VM Limited Partnership, an affiliate of Maryland National Bank, is trying to fill vacancies in the 4-year-old center, now that a lengthy court battle has ended.
"There are spaces that remain to be leased," said Cyd Beth Wolf, attorney with bank counsel Piper & Marbury. "The bank is making everyeffort to lease the center."
Anne Arundel Circuit Judge Robert H.Heller Jr. ruled Jan. 13 that an earlier foreclosure sale could go through despite Crow-Annapolis Limited Partnership's efforts to stop it.
Maryland National Bank, which financed the center in 1987, foreclosed on the property in December 1990 after Crow-Annapolis defaulted on an $11.7 million loan, court records show.
Two days later, the partnership of Dallas-based developer Trammell Crow filed for protection from creditors under Chapter 11 of the U.S. Bankruptcy Code. Five of the Festival's tenants also had filed for Chapter 11 protection.
The 80,494-square-foot Jennifer Road center, like many strip shopping centers built during the mid- to late-1980s development boom, suffered low sales as the recession took hold.
The bankruptcy courtin Dallas eventually allowed the bank to proceed with foreclosure. Bank-appointed trustees sold the property back to the bank last June.
The Fashion Festival, comprising three single-story buildings across from Annapolis Mall, was 67 percent leased at the time of the sale.
Since then, several merchants have left, including Bird of Paradise beauty salon and Linen Design.
Since the center opened, five tenants have declared bankruptcy and moved out, including T.J. Cinnamons, Paraphernalia, Narragansett, Flair Graphic and T. Deane.
Managers of remaining stores still complain of low sales and limited walk-by traffic.
Besides anchor Britches Great Outdoors, tenants include Talbot's, Country Curtains, Franklin Printing and Office Supply, Gingiss Formal Wear, Tuerkes, I'm Expecting Maternity, Best Jewelry, Spanning the Globe Travel, Shonin, Annapolis Formal Wear, Chase Bank ofMaryland, Visionworks, the Bombay Co. and Parvizian.
Separate Trammell Crown partnerships continue to run Giant Festival at Riva and Valu Food Festival in Severna Park, as well as Festival at Ritchie Highway in Pasadena, which is more than half vacant.
Last September, Annapolis Retail Limited Partnership, which operates Valu Food Festival, filed for bankruptcy protection after falling behind on loan payments to New York-based Metropolitan Life Insurance Co. Metropolitan Life claimed it was owed $12.8 million.