Berkshire Mall owner says he'll pay $211,000 in taxes by February 'for sure' (2024)

LANESBOROUGH — An owner of the Berkshire Mall property says back taxes owedwill be paid by February “for sure.”

That answer, from Joseph "Jay" Jones III, manager of JMJ RE Holdings, didn’t sit well with Select Board memberson Monday night.With $211,000 of town taxes overdue and the town poised to begin a tax taking for the Berkshire Mall, members of the Select Board grilled Jones about his plans for the building, which one member called an "albatross" for the town.

Both the Select Board and Jones were testy in their interchange over Zoom, but by the end of a more than 45-minute discussion, they came to a kernel of agreement.

The mall owners are being sued by the Lanesborough Village Fire and Water District for $105,000 in unpaid taxes, assessments and fees. And the Baker Hill Road District is also contemplating suing for $725,000 in unpaid taxes, interest and demand fees, as well.

At Monday’s Select Board meeting, member Deborah Maynard said the taxes were supposed to be paid by last Friday and because they weren't, the tax collector is now in the process of putting the mall into a tax title.

“But you also haven’t paid the first two quarters of fiscal '25, so you’re actually six payments behind to the town of Lanesborough,"Maynard told Jones.

Maynard said all the back real estate taxes are affecting the free cash certification, or the process by which a town's unrestricted funds from the previous fiscal year are verified and made available for appropriation.

“So it does really hurt the town when you don’t pay your taxes and you don’t pay them on time," she said.

Jones said he’s “$6 or $7 million into this property, so I think, I believe and I know we’re going to be able to handle a $211,000 tax bill.”

JMJ RE Holdings assumed a $5 million second mortgage when it bought the mall in 2023 for $1. That mortgage, due to Durga Properties, a previous owner of the mall, is now due Aug. 1, 2025.

Select Board member Timothy Sorrell also had questions about the mall’s plans, specifically when something is going to be done with the aging property.

“I hate to say it, the place is an albatross," Sorrell said. "It’s falling down. It’s a safety hazard.”

Jones and his partners initially planned to build anindoor cannabis facilityinside the mall. The owners later changed the plan to asenior housing communitywith associated businesses and health care facilities. The status of those plans remains unclear, though the owners have signaled their intent to demolish the existing structure.

While Jones was appearing remotely at the meeting, he introduced Tim Grogan, a development consultant, who was in the room and took a seat at the Select Board’s table to discuss plans for the mall property.

Grogan is working on feasibility, scoping and financing, he said.

“Obviously, we want to take this as far as we can in terms of units, jobs created and being able to fill a space this big, to replace what the Berkshire Mall was with something that’s useful to the town and also to generate income for the town on a tax basis,” Grogan said.

He said a feasibility analysis expected to be finished within two months will look at demographics, economics and employment as well as affordable housing.

“We dream of 400, 500 units, and that all depends on what the feasibility study can support,” he said. “We’re not just looking at a standard run-of-the-mill senior care facility. We’re looking at independent living, skilled nursing, memory care, palliative care, hospice care, and that’s all being added to this analysis.”

Grogan also spoke of the obstacles.

The mall pays taxes off the town mill rate of $17.01 per $1,000 of assessed valuation, “But based off the Baker Hill Road District we’re paying an additional, I believe like $71, $72 rate for an all-in tax rate of about $84, which is about 5.2 times more than any other business in Lanesborough, aside from Target," Grogan said.

Like Jones, Grogan said he doesn’t see the purpose for the Baker Hill Road District.

“I believe in this project, but at the same time, when your carrying cost on an empty building with no utility usage is still in excess of a million dollars because the tax burden itself is $650,000, where you’re paying five times as much as any other business, it’s inhibitive,” Grogan said. “That’s the main issue.”

Both he and Jones also objected to Bill Prendergast’s appointment as the representative of the mall and its two neighbors to the Baker Hill Road District.

Reached Tuesday, Prendergast said he’s tired of the questions.

“I was properly appointed to the position from the two of the three owners of the property: Target, Berkshire Mall Group,” he said. “The mall people, Jones and his gang, they own an empty building right now. The building that has actual use, which is Target, properly appointed me.”

Initially appointed by the mall’s first owner, Pyramid Cos., Prendergast said he’s tried to represent the interests of the road and the town on the Baker Hill Road District, where he’s served more than a decade.

On Monday, Grogan asked the Select Board to consider an appointee of the mall owner’s choice to that district.

“I think that’s a fair point,” said Michael Murphy, Select Board chair.