The Shops at Riverwoods, a lifestyle center near the upscale Riverbottoms neighborhood that was in receivership for the past six months after defaulting on mortgage payments, was quietly sold for about $15 million to a group of mostly local investors including Blake Roney, founder of Nu Skin Enterprises.

The Provo mall was acquired by Tigriswoods LLC, an investment group in Provo, according to court documents obtained Friday by the Daily Herald.

"I am involved, in a way," Nu Skin Founder Blake Roney told the Daily Herald Thursday night. "There are several other partners involved."

"Based on our analysis, the project was undervalued," said Blaine Knight, manager of Tigriswoods. "We valued the mall at what we thought it was worth and made an offer. There were several other bidders, but we don't know who they are."

The sale of the 187,000-square-foot shopping mall at 4801 N. University Ave. in Provo was approved by 4th District Court Judge James Taylor last week.

The mall was placed in receivership at the end of March after its lenders filed a lawsuit to foreclose on the property. According to the suit, mall owner TerraNet Investments LC defaulted on monthly mortgage payments on a $26.5 million loan in November and December of 2008, and January of 2009, which caused the loan to come due. As of Feb. 1, TerraNet owes $30.6 million in outstanding payments and penalties.

For the past few months, court-appointed receiver Cushman & Wakefield of California Inc. has been collecting rents and managing the mall's daily operations, including hiring of staff and managing all tenant contracts, while the foreclosure sale is being completed by Commerce CRG, the court-appointed property manager.

Duff Thompson, a general managing partner of EsNet Corp., the mall's principal investor, would not comment earlier Thursday except to say that a local buyer such as Roney "would be wonderful for Provo and our community."

"He makes everything he touches better," Thompson said.

Thompson had blamed the mall's financial troubles on the bankruptcies of two of its largest tenants, Spiegel Group's Eddie Bauer and Copeland Sports, as well as on the current recession. A slump in retail sales led to the departure of specialty apparel retailers Abercrombie & Fitch Co. and Ann Taylor.

Thompson said EsNet has been subsidizing a rental shortfall of between $500,000 and $1 million a year for The Shops for several years.

"We may have to do this for a bit. Our hope is we don't," Tigriswoods' Knight said. "Our price point is quite a bit different from TerraNet. They were financing $26 million to $30 million in loans. We don't have the same burden. Ours is about half that, which means we can lower rents to help bring more tenants in."

Knight said he hopes to bring in several local and national retail and restaurant tenants soon, in order to help stabilize the attrition rate and make it attractive for other tenants to open at the mall.

Since Copeland left in 2007, the mall hasn't been able to lease the former tenant's 50,000 square-foot space.

"That meant we had to come up with as much as $500,000 to cover for Copeland," Thompson said in an earlier interview. "The rents weren't enough to make the full mortgage payment." In December, when the recession intensified, the company stopped filling the gap with its own capital because several tenants weren't paying their rents or went out of business, he said.

Knight said the mall ran into its biggest challenge when it lost Copeland and other large tenants.

"How do we fill the Copeland space? That's the million dollar question," he said. "If we can fill the Copeland space, then the rest will just fall into place, we hope. We will approach some national chains who might consider being in the mall. We bought the place cheaper, so we can lower rents if need be. If that doesn't work, we have contacts that we can use."

Dan Ray, owner of Rocky Mountain Chocolate Factory, said he is happy that the mall is no longer in receivership. He said he was notified several weeks ago that the mall was being purchased by an investment group in Provo and that his lease will now be managed by the new owner.

Despite the economic downturn and the departure of several large tenants, Ray said he has no plans to leave after his five-year lease expires at the end of the year.

"Obviously the mall is valuable enough for someone to hop right in and buy it when it's for sale," he said. "I hope the new owner will create more business for the mall, and put more money in marketing to draw more tenants in."

The Shops at Riverwoods is part of a 112-acre mixed-use master-planned community that includes more than 2 million square feet of office space and condominiums. The Riverwoods Business Park and the residential development aren't part of the foreclosure proceedings. Carmike Wynnsong 12 and Hogi Yogi, two other businesses located within the Shops, aren't part of the acquisition.

Built in 1998, the mall has 31 existing tenants including Borders Books and Music, Jos. A. Bank, Bath & Body Works, Romano's Macaroni Grill, Talbots, Victoria's Secret, and Williams-Sonoma.

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