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Macy’s Property Ownership Poses Interesting Questions

by and on January 17, 2020 5:00 AM

Another Nittany Mall anchor store, Macy’s, has announced plans to close its doors, but unlike the other tenants at the mall, Macy’s Department Stores Co. owns the building and property it sits on, including the parking lot.

This is posing some interesting questions for College Township when it comes to the future of the property. The township planning commission discussed the situation during its Jan. 7 meeting.

Macy’s has operated at the Nittany Mall since 2006 after the company took over space occupied by Kaufman’s, which had been at the mall’s western anchor spot since 1998. The next closest Macy’s to State College is at the Logan Valley Mall in Altoona, which reportedly will remain open.

“That is the only piece of the mall that is owned differently,” said commission member Ray Forziat.

“They own the building and its 7.2 acres, which is a big chunk of that parking lot,” said township engineer Don Fransen.

This could be an impetus to change some of the zoning in the area, Forziat said. The township has studied the current zoning for the area around the mall recently to determine if things needed to change in order help bring more development to the area.

“Technically, that could be the start of changing that plan,” said Forziat. “If they sell to the right developer, but again, say they want to put a high rise there, they can’t do it (under the current zoning).”

“I think the initial charge of the township was to look at the present zoning ordinances and to see if they needed to be brought up to date. I think some of the emphasis from council was not only to look at that, but look at the economic component as well as zoning. So we are kind of following in that direction that maybe zoning needs to be scrutinized based on our recommendation and council approval,” said commission vice chair Robert Hofffman. “So it is a natural step, and we are kind of just going through the first step right now.”

“That is a shocking development,” said commission member William McKibbin.

Township manager Adam Brumbaugh said the township has not had any conversations about property with Macy’s.

In a changing retail landscape, the Nittany Mall has lost a few other anchor department stores in recent years. Bon-Ton closed in 2018 and the space remains vacant. Sears also closed in 2018, and while it has remained vacant, the mall confirmed last fall that national farm and home department store chain Rural King has signed a long-term lease for the location.

J.C. Penney closed its Nittany Mall location in 2015, and it was replaced by Dunham Sports.

In Feb. 2018, Nittany Gaming LLC signed a memorandum of lease option for the former Bon-Ton location, but no Category 4 gaming license was secured for the location because a lease agreement could be worked out with the mall’s owner.

Those who are hoping for a casino to purchase the Macy’s property would need the state legislature to act to make it possible. There have been no indications that a casino is in the works.

The Pennsylvania Gaming Control Board reopened bidding for Category 4 mini casinos in September, but during the first auction, there were no bids. The law stated that if there were no bidders there would be no more auctions. So there could not be any additional Category 4 auctions unless legislature changes the law, according to Douglas Harbach from the Pennsylvania Gaming Control Board.

This story was produced by the staff at the Centre County Gazette. It was re-published with permission. The Centre County Gazette is a weekly publication, available at many locations around Centre County every Thursday morning.

Vincent Corso is writer for Town&Gown and the Centre County Gazette.
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