ext j.c. penney citadel mall (copy) (copy)

The former J.C. Penney store at Citadel Mall will become an outpatient medical care facility for the Medical University of South Carolina. File/Warren L. Wise/Staff

Where once people shopped for clothes and household items, they will soon be able to get stitched up.

The Medical University of South Carolina has leased the former J.C. Penney department store at Citadel Mall for $16 per square foot, or just over $2 million a year, as an outpatient clinic.

The 126,000-square-foot space will be used for a musculoskeletal service line, ambulatory surgery center, imaging, patient services and support.

Penney shuttered the two-story store in July after 10 years at the West Ashley shopping center as part of the Texas-based retailer's cost-cutting move to return to profitability.

TMP SRE II LLC, a company that includes Richard C. Davis of James Island-based Trademark Properties, bought the retail store in August for $5.125 million.

"We are excited to welcome MUSC to the redevelopment of a prime West Ashley location, who has seen her better days," Davis said in a statement. "This is a perfect catalyst for what is needed West of the Ashley — jobs — and also a perfect complement to our world-class travel sports facility addition."

Over the summer, Davis installed an indoor basketball court near the former Penney entrance to attract more people to the mall and offer uses beyond retail.

"We have worked hard on our vision for a true mixed-use repurposing of this asset," he said. "Converting over 125,000 square feet of retail to Class A office space is a great step forward."

He also hinted there's more to come.

"We look forward to being able to share the full vision in the near future," Davis said.

Renovating the old J.C.Penney site is projected to cost $32.9 million. MUSC Health will kick in $16.4 million and the developer will provide the rest. MUSC's board signed off on the deal Friday.

Construction is expected to take 12 to 18 months, according to MUSC spokeswoman Heather Woolwine.

"With patient expectations for convenience and parking, and the major growth we continue to see in the Charleston area, this location enables us to be responsive to those expectations," she said.

"Improved technology also now enables us to bring more services out to the people we care for, without having to come to the peninsula," Woolwine said. "As for this specific location, we see that area as a great place to expand our ambulatory services as the city works to implement its revitalization and continued growth plans for West Ashley."

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MUSC agreed to lease the site for 15 years, with the option to extend the rental agreement for two terms plus five years for each period.

The state-owned hospital has an option to buy the property based on its appraised value along with credit for any improvements.

“We consider this a major step forward in the revitalization of Citadel Mall, bringing high-wage jobs and vital citizens services to West Ashley,” City of Charleston planning director Jacob Lindsey said.

John Orr of commercial real estate firm Colliers International lauded the alternative use for the big-box retail space.

"This is a big deal for the dead-retail-box genre," he said. "This site helps solve the problem on MUSC's peninsular campus of parking, and today's technology doesn't require the entire medical staff to be on site (in downtown Charleston)."

A separate Davis-led firm, TMP SRE I LLC, purchased 28 percent of the interior of the 1.1-million-square-foot mall in February for $17 million. Each of the remaining anchor stores — Belk, Dillard's, Sears and Target — own their buildings and footprints.

The shopping center fell on hard times during the last recession, when its vacancy rate climbed to 25 percent and its value plummeted. 

Chattanooga-based CBL Properties Inc. allowed the ailing property to fall into foreclosure about four years ago and turned over the keys to its lender. CBL still owns Northwoods Mall.

Reach Warren L. Wise at 843-937-5524. Follow him on Twitter @warrenlancewise.