BLOOMINGTON, Minn. - After falling behind on mortgage payments following the onset of the COVID-19 (coronavirus) pandemic, the Mall of America, home to Nickelodeon Universe at Mall of America - is now current on its mortgage, according to a spokesperson for the mall.
Triple Five, the owners of the Mall of America, missed at least two payments on its $1.4 billion mortgage last year. Due to COVID-19 restrictions, the mall temporarily closed in mid-March and did not reopen until June.
According to a statement from the Mall of America, staff began working with lending partners and were able to resolve outstanding issues by modifying the loan terms, reports Fox 9.
"Early in our conversations, lenders pointed out their strong confidence in the long-term success and viability of Mall of America," read a statement in part. "They understood that we faced a short-term cash flow issue during a time when many tenants were temporarily unable to pay rent due to the financial impacts of the pandemic."
According to the statement, the Mall of America has encouraged its tenants to apply to Paycheck Protection Program (PPP) loans and other programs amid the pandemic.
While the mall is open for retail, attractions like Nickelodeon Universe remain closed for the time being. Indoor dining is also not allowed, due to the governor's current order.
American Dream in New Jersey, including Nickelodeon Universe at American Dream currently remain open to the public. For the latest, visit https://nickelodeonuniverse.com.
From Bloomberg:
Mall of America Gets Modified Terms on $1.4 Billion Mortgage
- Owner Triple Five Group agreed to interest-only payment terms
- Mall must increase reporting and send net cash monthly
The Mall of America is current on mortgage payments it had missed during the pandemic, after lenders agreed to ease terms of its $1.4 billion loan.
The largest U.S. shopping center became delinquent on its debt last year after its owner Triple Five Group began skipping mortgage payments, citing hardships from the Covid-19 pandemic. It received a modification from lenders in December that allows it to pay only interest on the debt.
Under the terms of the modification, the 5.6 million-square-foot (520,000-square-meter) mall will continue to meet increased reporting requirements and send net cash to its lenders on a monthly basis, according to its special servicer. The shopping center has already done so for April to November 2020 as part of a forbearance and cash management agreement. The loan matures in 2025.
CWCapital, the mall’s special servicer, will monitor rent collection efforts and expenses as part of the deal. The Mall of America has been working to collect past due and current rents from its tenants, many of which have struggled financially since the pandemic began.
Details of the modification were earlier reported by the Minneapolis Star Tribune.
Covid Closures
The Mall of America was forced to temporarily close last March because of the Covid-19 pandemic. It reopened in June with limited hours and select attractions. As of November, the mall’s food services were available for takeout and delivery only and its Nickelodeon Universe amusement park was closed.
Retailers and their landlords, hurt by competition from online stores even before Covid-spurred shutdowns, have struggled to make rent and mortgage payments. The Mall of America collected about 33% of rents from retail tenants in April and May and 50% in July, according to its special servicer.
Other mall owners reported rock-bottom April rent collections, including about 12% for Tanger Factory Outlet Centers Inc., roughly 20% for Brookfield Property Partners LP and 26% for Macerich Co.
The Bloomington, Minnesota-based mall is owned by members of the Ghermezian family, whose holdings also include the West Edmonton Mall, a 5.3 million-square-foot complex in their Canadian hometown, and American Dream, a 3 million-square-foot mall in East Rutherford, New Jersey.
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Additional source: The Business Times Real Estate.
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