By Mark Heschmeyer CoStar News
For the second time in three months, Pennsylvania Real Estate Investment Trust has bought itself more time to sort out its options for $300 million in debt due on its Philadelphia-area Cherry Hill Mall.
Life insurers New York Life Insurance Co. and the Teachers Insurance and Annuity Association of America have extended the repayment of their loans of $150 million each backed by the 1.3 million-square-foot regional mall in the Philadelphia suburb of Cherry Hill, New Jersey, according to a PREIT filing with the Securities and Exchange Commission.
The new due date is February 2023, having been extended from its previous due date of this month. The November date was already an extension of the original due date in September. And the new agreement gives PREIT the option to extend one more time until May 2023.
The extensions point to lenders’ willingness to work with retail borrowers whose malls are rebounding from the initial impact of the coronavirus pandemic. They also buy both the borrower and lenders more time to see where interest rates end up as the Federal Reserve continues to fight off inflation with higher borrowing rates.
The total of the two loans represents the largest near-term individual property debt maturity that PREIT is dealing with, according to its latest quarterly report.
The extensions have cost PREIT more than $3.5 million in fees, according to the SEC filing.
PREIT representatives did not immediately respond to request for additional information on the Cherry Hill debt negotiations.
Late this summer, PREIT announced several new tenants at Cherry Hill Mall, including eyewear retailer Warby Parker, women’s fashion chain Marc Cain, a Levi’s store and menswear brand Psycho Bunny.
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