Published on February 18, 2026 2:55 pm
Last Updated on February 18, 2026 3:24 pm
Square Southtown confirmed today that it prevailed at a foreclosure auction on November 4, 2024, to purchase the Village Square Mall, with the intent of revitalizing the long-deteriorating property and reinvesting in Effingham’s south side.
Although the judicial confirmation of sale is not under appeal, the transaction has been unable to close due to a tangential stay currently pending before the appellate court. That appeal has now been ongoing for more than 15 months, with no clear indication of when a ruling may occur. As a result, Square Southtown must now confront the reality that, without intervention, the project may never move forward.
“This situation leaves us with two clear choices,” said Square Southtown representatives. “We could walk away and allow the property to remain in the hands of the current owner, where deterioration would likely continue. Or we could remain committed, even in uncertainty, and create a responsible path forward for the community.”
Square Southtown has chosen the latter.
Rather than abandoning the transaction, Square Southtown has proposed a put option agreement with the City of Effingham designed to protect the community’s interests while the legal process plays out.
Under this approach:
– Square Southtown will not walk away from the transaction.
– The company will leave its $130,000 deposit in escrow and maintain its contractual interest until the
appellate court issues a ruling.
– If the court rules in favor of the City, Square Southtown would close immediately on the transaction.
– Following closing, Square Southtown would evaluate whether the originally planned redevelopment
remains financially feasible.
– If the project is no longer feasible, Square Southtown would sell the property for an amount sufficient
to cover the purchase price and certain administrative expenses—ensuring the property is no longer
owned by the current owner and that the City’s $1.19 million lien is satisfied.
“This proposal is about doing what is right for Effingham,” Square Southtown stated. “If we are unable to see our full redevelopment vision come to fruition, that will be deeply disappointing. But we will know our efforts were not in vain if this allows the City to finally take meaningful steps to renovate and revitalize this long-neglected area.”
Square Southtown emphasized that its goal has always been to support the community, stabilize the Village Square Mall property, and contribute to the long-term health of Effingham’s south side.
Also Tuesday, City Administrator Steve Miller said the subject of recovery homes such as Oxford House was a topic for closed session, but no action was scheduled. Miller said he hoped for a vote on the issue as soon as possible.
There was a question from local resident Mark Mayhood concerning a review of tourism funds and how they could best be allocated. City Tourism Director Jodi Thoele said she is obtaining more information as to how tourism projects could be funded and other changes that could be made.
Council members were made aware that City Economic Development Director Todd Hull is retiring after 38 years’ service to the City. Hull’s last meeting will be March 3. An Open House for Hull will begin at 4pm that day, just ahead of the meeting.
