Mall of America in Bloomington, Minnesota.
Ariana Lindquist | Bloomberg | Getty Images
The Mall of America has modified the terms of its $1.4 billion mortgage and is current on the loan, after missing months of payments during the Covid crisis as stores shut temporarily and tenants failed to pay rent.
Triple Five Group, the owner of the largest mall in the U.S., started missing mortgage payments in April, CNBC previously reported. But it has struck a deal with lenders, who expressed “strong confidence in the long-term success and viability of Mall of America,” the owners said.
The $1.4 billion loan has been current since December, according to Trepp, a New York-based research firm that tracks the commercial mortgage-backed securities, or CMBS, market. Beginning with the December payment, the loan was converted to interest-only through maturity, Trepp said.
“Facing these unprecedented economic times, we immediately began to work with our lending partners to address the cash flow issues created by this loss of revenue,” Dan Jasper, vice president of communications for Mall of America, said in a statement.
“We are pleased to have been able to resolve the outstanding issues to the satisfaction of all parties involved which included a modification of the loan terms,” he said.
The Star Tribune first reported on the updated status of the loan.
The Mall of America was closed from mid-March through June due to the pandemic. Retail tenant collections at the property fell to a low of 33% in April and May, according to data from Trepp.
As restaurants, retailers and entertainment venues have been able to reopen at the mall, and traffic has started to rebound — especially around the holidays — Triple Five Group, which also operates the American Dream megamall in New Jersey, is hoping 2021 will be a better year for business. Still, Covid cases continue to rise around the U.S. and the threat of lockdowns being reinstated looms. The U.S. Covid vaccination effort, which was believed to have the potential to spark consumer confidence, also far lags original estimates.
“While the coming months will continue to present unique challenges, we remain optimistic for our business and look forward to the day when we can once again welcome back visitors from around the world,” Jasper said.
