Settlement may be quick fix to Fashion Square Mall's financial troubles

Orlando's Fashion Square Mall could soon be in new hands.

Recent court filings show the mall owner may be giving up the property, a month after filing for foreclosure.

A settlement could mean a quick fix to the mall's financial troubles.

The construction area at Fashion Square Mall was supposed to be part of the ongoing redevelopment of the struggling shopping complex, but now, the most intense activity comes from the court while the shopping complex works out its bankruptcy and foreclosure fight with lender Bankcorp.

“Here they're seeking the court's approval of a deal that they've already agreed to,” bankruptcy attorney Josh Tejes said.

Tejes isn't on the case but took a look at the settlement agreement filed in U.S. District Court.

Detailing an end to the 2013 business agreement with Bankcorp for a sum of $3 million, plus at least one other property in which Bankcorp has no lien, owners agreed to hand the mall back to the bank.

“So the owners and the guarantors get to walk away, and then the lender gets to take over the mall and operate it,” Tejes said.

What isn't clear in the 60-page settlement is the future of the complex, which has been slowly losing retailers.

It does mention the appointing of a court-appointed receiver or property manager.

The mall's legal counsel called the good faith settlement is in the best interest of the area.

The settlement allows the mall to continue to operate and complete previously planned upgrades, under its new owner, the lender.

An emergency hearing to approve the settlement will be held Tuesday in federal court at 2 p.m.

Cox Media Group