The city of Gaithersburg is hoping to revitalize the ailing Lakeforest Mall and its surroundings under Maryland’s Enterprise Zone program, an economic development tool that would allow developers to potentially qualify for millions of dollars in real property and state income tax credits.
Gaithersburg is targeting the enclosed mall for reinvestment after it was bought by a representative of U.S. Bank at a foreclosure auction last year for $19 million. Five Mile Capital Partners previously owned the mall and had pitched a redevelopment to the city of Gaithersburg in partnership with Hines Interests LP but the project never materialized.
Tom Lonergan, Gaithersburg’s economic development director, said his office is working to submit a formal application to the state by April 15 for a 250-acre enterprise zone that encompasses the mall as well as stores including Toys R Us and Burlington Coat Factory. The new enterprise zone would replace the city’s current 282-acre zone, which was established in 2008 and is set to expire in June.
“We determined we should request an amendment to the boundaries to go a little bit north to include the Lakeforest Mall,” Lonergan said. “We were shaving off a little bit at the fringes — areas that were less likely to see new significant investment or commercial redevelopment within the next 10 years.”