(KNSI) — The future of Crossroads Center shopping mall is up in the air as its parent company, Brookfield Property Partners, has fallen behind on its loan.
According to documents obtained by KNSI News, occupancy has declined since 2016, and the pandemic pushed the mall into delinquency. While the mall found new tenants for former anchor Sears and other stores like JCPenney and Macy’s saw sales rebound last year, it is still not generating as much cash as it was in 2019. The mall was 87% leased as of September and is generating just enough cash to potentially make its current payments but not enough to catch up on what is outstanding, along with penalties and interest. Brookfield fell behind on payments and was transferred into special servicing in October 2020.
The loan is secured by over 766,000 square feet of space, including anchor stores like JCPenney and Scheels, which are considered collateral in the dealings. Target is not part of the collateral pool, and Macy’s has a ground lease that allows it to own the improvements it made to its store.
In December, credit rating agency Fitch said its base case is a 69% loss on the loan and is one of the biggest busts of the company’s 2018 purchase of mall owner General Growth Properties.
The mall could go into foreclosure as early as April.
Emails to Brookfield requesting a statement on the matter were not returned.
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