A Hays service center that has been in operation for more than four decades at the southwest corner of the mall property soon will be vacant.
G&L Tire and Automotive will relocate from the Big Creek Crossing outlot to the former Midland Marketing service center at the corner of Eighth and Oak.
“Midland Marketing will be closing the service center, but we will still provide fuel and service to their customers,” G&L owner Alan Leiker told Hays Post on Wednesday. “We truly believe that things happen for a reason, and we want our current customers to know that we might be in a different location, but can still expect great service from G&L Tire.”
Leiker said G&L will purchase the former Midland building and be open for business on May 1. The business formerly had rented its building via a sublease from JCPenney.
That lease is scheduled to expire in April, and Leiker said renegotiation terms offered by the mall’s owners were unfavorable. Big Creek Crossing is managed by Omaha-based DP Management and owned by New York-based GJ Realty. Leiker said GJ Realty owner Gabriel Jeidel contacted him June 2016 to begin negotiation of a new lease.
“I stated that we had been here for 20 years, wanted to stay in the property and liked the location. After numerous emails and phone conversations we couldn’t strike a deal. Ultimately, it came down to cost,” Leiker said. “In our opinion, we are being squeezed out.”
The new lease offer was “absurd,” he said, noting G&L would be required not only to pay rent, but also property taxes and upkeep on the 44-year-old building — adding there are several “major” maintenance issues at the building that need to be rectified.
Josh Vickery of DP Management said the terms offered were fair. He said talks between JCPenney and GJ Realty recently reverted control of the lease back to the owner.
“G&L had a term with JCPenney that was well below what market rate was,” he said. “I just know (GJ Realty) wanted a market-rate lease there, and they just couldn’t come to a number that works for everyone.”
“In a 10-year period, we could have bought a lot north of town and built a new beautiful building for the same cost as he was expecting us to pay in the same time period for a building 40-plus years old,” Leiker said. “In addition, we would have something of our own.”
Vickery said there are no current prospects for that location, but all options are on the table.
“Quite frankly … we feel that being on that corner, it’s a worth a lot more than what has been paid in the past,” he said. “It’s already showing a bunch of interest from national retailers. It’s in a stellar location.”
G&L has been in operation since 1997, when Ruder tire was purchased from Dave Ruder. Ruder was sub-leasing the property from JCPenney, which had closed its service center in 1983. The original JCPenney service center opened in 1973.
Leiker also questioned the commercial improvement district fund, which assesses an additional 1 percent sales tax on purchases there to help with physical improvements at the aging shopping center.
While several interior and exterior improvements have been made at Big Creek Crossing, Leiker said his site did not benefit.
“I contacted the mall management to find out what improvements they were going to do to my building, since I have been collecting 1 percent sales tax for them, and I was told nothing,” he said. “The only thing we received was repaving the parking lot around my building, but only after I complained.”
Vickery said the outbuilding simply was never part of the redevelopment agreement between the shopping center and the city of Hays when the CID was approved.
The lease between G&L and GJ Realty expires at the end of April, Leiker said.