Queen K Center faces foreclosure suit
Owners express optimism for mall’s future
KAHULUI — Despite facing a foreclosure lawsuit after defaulting on a massive loan, Queen Ka’ahumanu Center owners through a representative expressed optimism about the future of Maui’s main mall.
Lender U.S. Bank filed for foreclosure on the Kahului shopping center on Nov. 12, alleging owner QKC Maui Owner LLC defaulted in June, according to 2nd Circuit Court documents. The lender said nearly $87.5 million was owed on the loan as of Oct. 14.
“It is in the best interests of all parties concerned to maintain both the operations and the appearance of the center, while protecting the interests of center tenants and customers,” Stephanie Zimmerman, manager and general counsel for the mall owners, said via email Thursday. “Optimistically, we hope to get an opportunity to restructure the debt as well, when COVID-19 has passed.”
Saying that the company cannot comment on details of ongoing legal action, Zimmerman noted that mall owners are disheartened by the situation and the financial impact of COVID-19. She did not say whether the mall would have to close.
“The current ownership of QKC has held and operated the center for nearly 20 years and is very saddened by this situation,” she said. “The impact of COVID-19 on the community has been very far-reaching, with many of our tenants shut down for long periods of time through no fault on their own.”
“During the past year, management has worked hard to help those tenants, whenever possible, to maintain their businesses and protect the center,” Zimmerman added.
Although not a new situation, vacancies at the 571,000-square-foot, two-story Queen Ka’ahumanu Center property have increased since the onset of the pandemic. In March, county and state public emergency orders shut down nonessential businesses, which included most mall tenants.
Some reopened after months when the county lifted restrictions; other tenants decided to cease operations due to the pandemic, according to interviews with The Maui News last year.
At least 30 units — including four of nine food market spaces — were vacant Thursday. Anchored by Macy’s, Sears and Foodland, the
mall has about 120 total units, according to the center’s map.
Kahului resident Jenny Dimercurio, who was at the center Thursday afternoon, said a mall closure would be “devastating” for Maui.
“I don’t want it to close,” said Dimercurio, adding that she has been visiting the center for over a decade. “People come here for their sanity. Recently it’s nice to be able to decompress and just stroll around even if we can’t spend very much money, maybe spend a little bit of money and try to keep some businesses open.”
She said brick-and-mortar store closures are not new, though, and more should be done by the government to help struggling landlords and tenants.
“We don’t want to be a ghost town,” Dimercurio said. “We want the town to be vibrant.”
U.S. Bank on Nov. 16 requested that management of the property be placed under receiver Oscar Parra of Pacific Retail Capital Partners.
The receiver is “empowered to manage, oversee, take control of and operate the property and to take any and all actions necessary to fulfill his duties.”
The 2nd Circuit Court recently granted the request but both sides have yet to finalize the order, documents show.