Willow Grove Mall’s Owner PREIT Has ‘Substantial Doubt’ Over Ability to Stay in Business Over the Next Year
Pennsylvania Real Estate Investment Trust (PREIT), the owner of Willow Grove Park Mall (and others), has “substantial doubt” about being able to remain in business over the next year. The news of its shaky future was contained in its 2021 annual report filed with the Securities and Exchange Commission. Natalie Kostelni bagged the story for the Philadelphia Business Journal.
PREIT made its dire conclusion after evaluating current financial conditions and the funds it has available, along with future cash flows and debt payments coming due.
The Philadelphia owner of regional malls is weighed down by $1.2 billion in debt with loan maturities on the horizon, most notably a Fashion District Phila.(FDP) Loan with a $194.6 million balance due January 2023.
Company executives are working to extend the loan backed by the FDP. However, PREIT has admitted in its annual report that it did not meet some loan covenants.
This “triggered the lender to sweep cash from the property,” wrote PREIT, but added that “this is not an event of default.”
PREIT is hoping a sale of some of its properties will bring a reversal of fortunes, including the sale of Exton Square Mall, announced this week.
Read more about the mall owner’s dilemma in the Philadelphia Business Journal.
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