Circle Centre's profit gets in the way of change

Circle Centre Mall hauled in millions of dollars last year, a paradoxical performance that illustrates why the dying shopping center has meandered toward redevelopment for the better part of a decade.

Driving the news: Circle Centre recorded a $4.3 million profit last year, even as the pandemic dealt a knockout blow to a swath of tenants, per a financial report issued to the city.

Why it matters: The 28-year-old indoor mall is a relic of 1990s tastes, but reliable profitability has made ownership reluctant to overhaul the two blocks of increasingly spiritless space in the heart of downtown Indianapolis.

Between the lines: Even when a tenant leaves, it is responsible for fulfilling its lease — in many cases paying rent for years after the lights have gone out.

• Circle Centre had 69 open stores as of Dec. 31, yet counted 102 active leases, per the report.

The big picture: Circle Centre is a complicated property with many interests at play, the result of an intricate public-private partnership woven together by former Mayor Bill Hudnut.

• The mall has 17 owners, down from 20 when it opened in 1995, per the IBJ.
• The city owns the land.

State of play: The ownership group, Circle Centre Development Co., has taken steps toward transforming the property, spurred in part by the 2021 exit of Simon Property Group, which had been the mall's longtime steward.

What we're watching: Hendricks Commercial Properties, which built the Bottleworks District and Ironworks at Keystone developments, is in serious talks to lead the Circle Centre redevelopment, per multiple sources familiar with the discussions who spoke anonymously due to the sensitivity of the deal.

• Neither Hendricks nor Adam Collins, an attorney representing the Circle Centre owners, responded to requests for comment Monday.

• Mark Bode, a spokesman for Mayor Joe Hogsett, said he had no update to share.

Flashback: Redevelopment proposals date to at least 2015 when Simon, a former co-owner and manager, introduced a plan to add apartments or condos.

• That went nowhere.

The intrigue: Circle Centre's sustained profitability, plus the sheer number of owners, makes for arduous negotiations because there are likely to be buyouts before a new deal can move forward.

The bottom line: Almost everyone with a stake in downtown agrees Circle Centre needs to be revamped, but the mall's status quo has a strong gravitational pull.