Vendors disheartened by owner’s plan to close half of Little Village Discount Mall: ‘It’ll never be the same’

Vendors from the Little Village Discount Mall gathered once again Thursday evening after meeting with the property’s new owner to share their discontent with the future for the emblematic shopping center.

The company announced it had reached a deal to extend the lease with only one of the mall’s two operators closing one side of it indefinitely and leaving nearly half of the vendors out of the mall.

Ald. Byron Sigcho-Lopez, 25th, who has been advocating for the vendors, said Novak Development, the new owner, increased the rent for operators, making it “impossible” for them to continue selling at the mall, 3115 W. 26th St.

“There’s no agreement unless all the businesses that are willing to stay, are accommodated,” he said. “Otherwise, these improvements, or investment, in the so-called best interest of the community is simply not the case when we are displacing half of the small business vendors in the Discount Mall.”

Sigcho-Lopez said his office has demanded that all permits and licenses for Novak to begin renovations and changes be put on hold by the city until the company creates a proposal to ensure that all vendors — and not just half — can stay at the mall.

In a news conference at La Baguette Bakery, vendors expressed their disbelief and concerns.

The news that the Little Village Discount Mall will remain open initially excited vendor Kocoy Malagon. “It sounded too good to be true,” she said in Spanish. “It wasn’t true.”

Malagon was one of the vendors who began galvanizing fellow merchants in 2020 to rally the community in their support when they learned that its new owner, Novak, planned to get rid of the mall.

The mall will only remain partially open, leaving space for roughly half of the 150 vendors. Novak announced it was able to sign a new lease with Pilsen Plaza Corp., one of the two leasing companies that operate the mall.

Malagon, along with around 80 vendors, have until March 26 to leave the premises.

The Discount Mall is operated by two leasing companies, Pilsen Plaza Corp. — the one staying — and P.K. Mall Inc. Jake Paschen, executive vice president of Novak Development, said that despite various conversations over nearly two years, the company could not reach a deal with P.K. Mall, which operates the side of the mall where Malagon sets up shop.

Marta Torres, who manages the side of the Discount Mall that will be closing, sent a letter Thursday to the vendors confirming that their area will be closing, and that the last day of occupancy will be March 26.

“It is with a heavy heart that I write to inform you that the Discount Mall will soon be closing its doors. Despite our best efforts over the last 13 months to negotiate a fair deal with the new landlord, we were unable to secure a viable solution that would have allowed us to continue operating in a way that aligned with our core mission,” the letter said.

In the letter, Torres said the new landlord’s proposed rent increase “would have made it impossible for us to continue providing the same value and support to our vendors for which we have always strived.”

The mall will go from about 70,000 square feet to 40,000, said a spokesperson for the company. And renovations will begin as soon as next month.

The renovations include new facades, roofs, lighting, landscaping, signage and a new surface parking lot with an underground stormwater detention system.

The new lease that will allow for Park to continue to license spaces to vendors runs 10 years, with three five-year options, for a potential total of 25 years.

In a news release, Novak management said that “contrary to the rumor mill, Novak has been negotiating with Mr. Park, and the owner of the other discount mall who has decided not to extend its lease, for more than a year and that team members met with a group of vendors on September 13, 2022.”

But the company said it could not share specifics until it had finalized lease arrangements with Park.

Walgreens, Esperanza Health Center and La Baguette Bakery are expected to remain in the plaza.

News that the mall was going to change surfaced in 2020 when a report by Sun-Times revealed that Novak had acquired the property for $17.5 million and planned to bring in national retailers.

Since then, tension and rumors have sometimes overshadowed the economic power and even beauty of its culture, said Juan Zarate, whose family has three stores on the side of the mall that will be closing.

“This cannot be replicated anywhere else. Once we’re gone, it’ll never be the same,” he said.

While most vendors welcome renovations, others question at what expense they’ll be, he added.

“We’re like a family and they’re tearing us apart, but that’s business for you,” Zarate said.

Guillermina Solis began renting a spot in the 1990s. First she sold CDs, and now she sells hats and handcrafted belts.

Solis is unsure if she will be able to stay even though her shop is on the side included in the new lease with Novak.

The rent was recently raised by 30% and Solis expects another hike once the renovations are done.

“Even if I wanted to stay, I won’t be able to afford it,” she smiled. “But I’ve been here all my life, I’m OK if I leave. It’ll be sad but I don’t take much with me.”

Novak will have no say in how Park chooses which vendors stay or if they will work with the vendors under the operator that did not sign a new lease, said a spokesperson for the company.

Malagon said she has not lost hope. She was one of the vendors who met with Novak.

“It’s inhumane, to force our manager to kick us out,” said Malagon. She urged her fellow vendors to keep strong and support each other as they continue to seek for a way to stay and keep the mall open.

Sigcho-Lopez advised vendors to ignore the notice from their manager to vacate the property until he can help secure another meeting with Novak and the city on Feb 24.

Maurice D. Cox, commissioner of the Department of Planning and Development, and Samir Mayekar, deputy mayor for neighborhood and economic development, also attended the meeting but could not be immediately reached for a statement.

rrequena@chicagotribune.com

larodriguez@chicagotribune.com