Industrial Commercial Properties enters winning and only bid at auction for City View Center – Crain’s Cleveland Business

A Solon-based real estate developer will take control of the failed City View Center retail project in Garfield Heights, after entering the winning and the only bid for the property.

During a brief auction Thursday morning, Dec. 10, an affiliate of Industrial Commercial Properties LLC offered $2 million for the 60-acre shopping center, which already is being repositioned as a business park.

No money actually will change hands. As the holder of a $132 million note on City View, through a joint venture with local attorney George Simon, ICP had the ability to credit bid up to the full amount of that debt.

The sale, likely to occur within 30 days, closes the book on a nearly 12-year saga of litigation, receivership and distress.

Standing outside a former bank branch on the site Thursday morning, court-appointed receiver Donald Shapiro wryly observed that his oversight of City View began during an economic crisis and is finally ending in the middle of a pandemic.

While Shapiro conducted the sparsely attended auction, painters touched up the stripped-down facades of former big-box stores in the background.

ICP is marketing space at the project, rebranded as Highland Park, to light industrial occupants, technology companies and office users. The site spans more than 500,000 square feet of buildings, with room for more construction. The sole remaining retailers are a Giant Eagle supermarket and Applebee's.

Owner Chris Semarjian said that ICP might announce its first tenant before the end of the year. He described the auction as "a big step in the process."

A federal court judge still must confirm the sale.

City View, just off Transportation Boulevard near Interstate 480, opened in 2006 on the site of former municipal landfills. By early 2009, the project was the subject of a foreclosure lawsuit, spurred by a flurry of retailer departures, the Great Recession and clashes between the center's original developer and the Ohio Environmental Protection Agency.

U.S. District Court Judge James Gwin signed off on the foreclosure in 2012. But it took eight more years, and investors with an eye for troubled debt and challenging projects, to make a deal happen.

Simon bought the note on City View in 2017, at an undisclosed price. ICP formally stepped into the court process in April.

In late September, ICP reached an important milestone with the Ohio EPA, signing a legal agreement that allows the developer to take over monitoring and gas-extraction systems for the property. That agreement paved the way for Thursday's auction, where ICP Chief Operating Officer Chris Salata entered the minimum, $2 million bid with little fanfare.

After the event concluded, Shapiro acknowledged that his long-running receivership has been a challenge. But, he said, every challenge presents an opportunity. Now it's time for the next steward, with a new vision, to step in.

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Industrial Commercial Properties enters winning and only bid at auction for City View Center - Crain's Cleveland Business