A struggling Chinatown mall at the base of the Manhattan Bridge could get a much-needed makeover from a new operator who will be required to invest up to $5 million into fixing the space over the first year and a half of a new lease.
The East Broadway Mall has languished for years as dozens of businesses closed inside the once-vibrant shopping center, with just a few shops open amid vacant storefronts. The escalator inside used to take visitors to a banquet hall, but now it doesn’t work and is blocked off.
The current lease operator filed for bankruptcy in 2019 and has struggled to pay rent to the city, which owns the property from its previous incarnation as a municipal parking lot.
The Department of Citywide Administrative Services announced Monday it has a tentative agreement with a new operator who will revitalize the space while not evicting current tenants. The deal still needs approval from the Manhattan Borough Board.
If approved at the Manhattan Borough Board meeting on Sept. 27, Broadway East Group LLC would be required to pay back some of the money the city lost as the current operators struggled, particularly during the pandemic.
The developer will have 16 months to invest $5 million into renovations for the three-level building, and must also pay millions back to the city and the Bank of Hope, where the previous leaseholder held a mortgage.
“We’re putting a big investment and hoping to maintain the Chinatown culture, and maintain a restaurant in Chinatown to cater parties and banquets and things like that,” Bill Lam, a developer and principal member of the new lease holder, told THE CITY.
Under the deal, Broadway East Group must keep the current tenants for two years, he said.
The mall “needs new development, a new concept, new everything to make it attractive,” Lam said.
The mall’s current operator, Terry Chan, did not respond to calls and text messages seeking comment.
After the East Broadway Mall filed for bankruptcy in 2019, Chan’s bank exercised its right to bring in a new tenant at the space, according to a city official.
In 2015, Chan stopped paying the city its annual rent and maintenance fee, as well as money for a payment in lieu of property taxes, or PILOT. He owed the city more than $12 million, including more than $4 million in late fees, Curbed reported last year.
Chan told Curbed the 50-year lease his father signed in 1988 had become more and more untenable due to multiple economic factors and shifts in the neighborhood’s population. The mall also suffered during the pandemic, and Chan urged the city to help reduce his rental costs.
“Back before the pandemic, this whole first floor was pretty much occupied. Now it’s decimated from the pandemic,” he told ABC7 in 2021. The mall has space for 80 tenants, but at the time there were just 17 left, he said.
Chan tried to maintain ownership of the space, putting in his own bid once the city opened up bidding — and records show he has spent $258,000 since 2019 to lobby city officials about the mall.
A Chinatown Hub
Soon after opening in 1988, the mall at 88 East Broadway became a hub for the local community, particularly newer immigrants from the Fujian province in China. The ground floor and basement housed local businesses, including tailors and dry cleaners, and the second floor was home to a large banquet hall.
Democratic City Councilmember Christopher Marte, who represents the area, said families in Chinatown held celebrations at the second-floor dim sum hall, 88 Palace, which closed in 2020.
“It was a tradition of people having their first dates there because they trusted their service,” Marte told THE CITY. “A lot of people had missed it.”
Nelson Mar, the president of 318 Restaurant Workers Union, confirmed to THE CITY that the union is working with the the developer on hiring for the proposed restaurant, which could seat up to 800.
The future restaurant operator will prioritize hiring for workers who lost their jobs after the three largest restaurants in the neighborhood — Joy Luck Palace, Jing Fong and 88 Palace — closed.
Once all of the city approvals are cleared, Lam said he hopes to start working on the mall by the end of the year or early into next year.
“I was there from day one, when it was a parking lot, so I know everything about this shopping mall,” the developer said of the space. “Right now it needs a major cash infusion to change everything, to make it attractive again, because it’s been neglected for the last 10, 15 years.”