Mall of America No Longer Delinquent On its Mortgage
When the COVID-19 pandemic forced the Mall of America to close in March 2020, the mall, and its tenants, were faced with unfortunate financial difficulties. In April, the mall missed the first of many payments on its $1.4 billion mortgage. Despite the initial grace period following the first missed payment, the Mall of America continued to remain in delinquency for months. However, the Mall of America was able to modify the terms of the mortgage and is now current on the loan as of December 2020.
Throughout the course of the mall’s delinquency over the last ten months, the Mall of America has said it has been working with its lending partners since the initial effects of the pandemic began to take a toll on its ability to pay the mortgage. The Mall of America was forced to remain closed from March to June, along with all of its retail tenants. And as in-store retailers across the country suffered from lower sales due to the risk of exposure to COVID-19 from shopping in-person, tenants at the mall had trouble making rent. According to a data firm that tracks loans such as the Mall of America’s mortgage, retail tenant collections at the Mall of America hit a low of 33% in April and May 2020.
During the Mall of America’s struggles, representatives said its revenue had dropped 85%. The mall was also forced to lay off over 200 employees. In August 2020, the mall owners reached a cash-management forbearance agreement with its loan servicers, which included additional reporting requirements and monthly remittance of cash as a short-term resolution. In December, the loan was converted to interest-only through maturity. As of the December mortgage payment, the Mall of America is no longer delinquent on its mortgage.