JOHNSTOWN, Pa. – The Johnstown Galleria sold for $3,150,000 Thursday at the conclusion of an online auction through the Ten-X Commercial Real Estate marketplace, the Ten-X website shows.
No information about the top bidder was released by Ten-X on Thursday. More information about the buyer will be reported as the story develops.
The auction was opened Monday at a base bid price of $1.4 million. Bidders were required to bid in minimum increments of $250,000, the website showed. The competition didn’t heat up until the clock wound down to the final hour on Thursday.
The sale price reached Thursday could play into an ongoing tax assessment appeal for The Johnstown Galleria, attorney Tim Leventry said. Leventry is the solicitor for Richland School District, one of the taxing authorities that receives local revenue from residential and commercial property taxes.
For the past year and a half, the mall’s previous owner, Adar Johnstown LLC, and local taxing authorities have been working to reach an agreement on a fair tax assessment for the property.
For tax purposes, appraisers have assessed the mall’s value as of 2018 as $3.7 million, down from $6.5 million in years past, due to appeals by the mall’s previous owner, according to the Cambria County Tax Assessment Office. As a result, over the past five years, Richland School District lost about $140,000 in local tax revenue, school officials have said.
“There’s been a lot of controversy in regard to value of the mall,” Leventry said. “Malls throughout the country have declined in value and use. Taxing authorities have to be wary of that. The question is, ‘What’s fair value?’ This auction may be an indicator of what that is.”
The tax assessment appeal that has yet to be settled was initiated in 2021 by Adar Johnstown LLC, prior to the county sheriff sale that year, which saw the mall’s creditor take back the mall until the sale Thursday.
Although Adar is no longer the owner, the tax assessment appeal is ongoing. If the appraised value is lowered, it means new owners would pay fewer taxes in the years to come, and Richland School District, Richland Township and Cambria County would see less revenue.
However, Leventry said he hopes the new owner would add value to the mall, making it a profitable property and a benefit to the community.
“The hope would be that the new buyer would be willing to renovate or rehabilitate the mall,” he said. “There’s a lot of money to be spent on the exterior infrastructure, roads, sidewalks and facades.”