by Wolf Richter
Wolf Street
As largest mall landlord in the US sheds its malls, CMBS holders, such as bond funds and pension funds, take the losses.
After Simon Property Group, the largest mall landlord in the US [SPG], stopped making monthly interest payments in June 2020 on a $100-million loan backed by the 1.1 million square-foot Montgomery Mall in North Wales, Pennsylvania, the slow gears toward foreclosure began grinding. On August 31, a formal notice of default was issued, followed by a loan acceleration notice a month later. Now it’s over.
The creditors have foreclosed on the mall and have obtained a judgement of $119 million, including principal, unpaid interest, and expenses, against the Simon entity that owned the mall, Mall at Montgomery LP, according to court documents, reported by Philadelphia Business Journal.