General Growth drops pursuit of Neonopolis

Officials at General Growth Properties of Chicago said Friday they have no interest in buying the three-story retail edifice that so far has failed to attract shoppers downtown, despite making inquiries about the mall earlier this month.

“Today we told the city of Las Vegas that we have decided not to pursue the opportunity at Neonopolis that was presented to us,” Jim Graham, a General Growth spokesman, said in a written statement. “We have to choose new ventures very carefully, and for a variety of reasons this opportunity was not a good fit at this time.”

The rejection by General Growth, a real estate investment trust worth nearly $16 billion that already owns Fashion Show mall on the Strip and Summerlin Centre near Sahara Avenue and the Las Vegas Beltway, leaves city officials to deal with Neonopolis’ current owners, a company whose ability to revive the mall is in doubt.

Rohit Joshi, who represents current owners Wrirrula Hayward, had said earlier he was excited General Growth was interested in Neonopolis but had little to say after the company backed out.

“They really met with the city, not with me,” Joshi said. “We have absolutely no comments to make about anything.”

Scott Adams, director of business development for the city of Las Vegas, also had little to say Friday about Neonopolis.

“We will not be commenting on this matter,” Adams said via e-mail.

Earlier in the week, Adams had said General Growth would be an ideal company to operate Neonopolis because of its success developing festival marketplace-type malls.

Instead, Wrirrula Hayward, which bought Neonopolis last year for $25 million, will continue to operate the mall. But it will do so under the watchful eye of city officials who have an interest in seeing the mall succeed.

The mall is located at the corner of Las Vegas Boulevard and Fremont Street. When Neonopolis is quiet it creates an area devoid of foot traffic between the Fremont Street Experience pedestrian area and the nascent Fremont East district, an area of hipster bars and live music venues the city hopes will attract more locals downtown.

In addition to a desire to have a bustling link between the Fremont Street Experience and Fremont East, the city has a direct financial stake in Neonopolis.

It owns the underground parking garage beneath Neonopolis as well as an $18 million note on the property payable if the mall hits certain revenue targets.

“We own the land and the parking garage and they own … the building,” Adams said in an earlier interview. “You are kind of joined at the hip there.”

But the private ownership of the mall itself makes marketing the property complicated business for city officials, he said.

“We have to be very careful,” Adams said. “We obviously respect a private party-to-party transaction, we do have an interest, though.”