Reuters had a headline grabbing (give it time, it'll make its way up the headlines) story out today about a Simon Mall about to default.
Default, or not? Occupancy is rough at only 65%, but they're still covering at 1.74x. Any quick review of cash flows and the mall is likely worth far more than the 55% OLTV senior mortgage on it. The maturity date is July 2010, so the real problem is what is going to happen then - refinanced and paid off, or extended.
Seems like a tough call. If you use GGP as a guideline - highly performing assets, maturity dates looming - it will get modified.
The scary part is the special's comments where they apparently do not know the anchor tenants (none of which are part of the collateral). I refer them to the Mall's tenant directory and map.
servicer commentary is almost as useful as the agencies. have found material changes in an asset that have not been updated in some time.....and gotta love them using 3 paragraphs which such insight as NCF down due to a drop in Occupancy and increase in expenses......Really?????
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