A budget approved for Central Mall’s new management company reflects the responsibilities of those put in charge of managing the retail and food side of the former commercial complex.

The City of Lawton is the new owner of the mall, signing a sales contract Jan. 5 that conveyed the almost 600,000-square-foot structure from Kohan Retail Investment Group to the city. City officials created the FISTA Development Trust Authority to manage and operate what is being called the FISTA, and the trust authority, in turn, designated Intouch Management Services LLC to handle the retail, food and common areas of Central Mall. Empty storefronts that will be converted to use for defense contractors working with Fort Sill and its two U.S. Army Cross-Functional Teams will be managed by the FISTA Development Trust Authority and its executive director, James Taylor.

Ward 4 Councilman Jay Burk, the mayor pro tem who was designated by the City Council as its representative on the trust authority, said the budget outlined by Intouch reflects the responsibilities the entity is taking on, from paying utility bills, to collecting rent, to hiring staff.

He said the management firm is estimating total annual expenses of $1.33 million on the retail side, to include utilities, services, office expenses, repairs and maintenance, taxes and insurance. The tax issue is important; the City Council agreed in December it would provide an annual in-lieu-of payment for the mall, equal to the ad valorem taxes that no longer will be paid for the complex because what had been private property now is owned by a governmental entity. The county assessor estimated the in lieu of payment/ad valorem taxes at $201,600 a year, and as with the previous owner, tenants will pay a pro rata portion of that tax bill on their monthly rents (base rental proceeds are estimated at $2.016 million).

Some of the other expenditures projected for the year include the $150,000 management fee to Intouch, along with utilities ($398,400), security ($156,000), janitorial ($96,000), maintenance ($84,000) and administrative/marketing ($72,000).

The new manager also will be going after past due rents that have not been paid by some mall tenants for various reasons. For example, Burk said J.C. Penny, the mall’s last “big box” tenant, will pay an estimated $200,000, possible after the retailer’s parent company completed the sale of the company last week. Another major retailer in the mall owes about $80,000, Burk said, explaining many tenants are “trying to catch up” after losing large amounts of customers and sales during the COVID-19 pandemic.

The City of Lawton/trust authority, not the former owner, will receive those past due payments, said Deputy City Manager Richard Rogalski, adding the city also will receive January’s tenant rents, although the City of Lawton didn’t take ownership of the mall until Jan. 5.

Burk said the discussions are part of the process to clear up finances and strengthen the mall to ensure its retail entities remain strong and economically viable.

“They all want to stay,” he said.

Expenditures for the mall also will include $255,383.90 for what is estimated for insurance, which includes general liability for the entire complex and flood insurance for the parking lots on the east side.

Rogalski said those lots will be analyzed to determine exactly what causes flooding during heavy rains. He said it could be multiple issues — undersized drainage lines, broken lines, or debris that has found its way into collapsed lines — and officials don’t want to replace what they assume are undersized drainage lines before determining if that really is the problem.

The decisions are part of the process the nine-member trust authority will continue as they keep existing tenants viable while preparing offices for defense contractors. Mark Brace, a member of the trust authority who helped analyze the lease agreement with the City of Lawton, said the trust authority can do whatever it wants with the mall property (within the confines fo the lease agreement), “as long as it is for the betterment of the City of Lawton.”

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