Green Street



American Dream Mall Developers Put Up Other Mega Malls as Collateral

According to The Wall Street Journal,

The developer of American Dream, a mall and entertainment complex outside New York City, is so confident this much-delayed project will succeed it is putting ownership of its two most high-profile holdings at risk.

Triple Five Group, which owns the Mall of America in Bloomington, Minn., and West Edmonton Mall in Canada, has pledged 49% interest in these two properties as collateral to secure a $1.67 billion construction loan for the East Rutherford, N.J., project, loan documents show.


Real-estate financiers said that if lenders require additional assets as collateral, it typically indicates that the lenders deem the project risky and that leasing might be challenging.

“Lending standards for malls have tightened in the last five years,” said Vince Tibone, an analyst at real-estate research firm Green Street Advisors.

While American Dream is a very unique project with more entertainment tenants, “there’s still risk involved, and it doesn’t surprise me that lenders want collateral in its high-quality malls,” said Mr. Tibone.

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