Brookfield Scores $700M Refinancing Loan For Oak Brook Mall

Brookfield Properties has secured a $700 million loan to refinance one of the largest malls in the Chicago area.

The move allows Toronto-based Brookfield to pay off $475 million in existing debt on the 2.6 million-square-foot Oakbrook Center mall, CoStar reported.

After closing costs, Brookfield is poised to rake in $220 million in equity out of the west suburban property, which it acquired in 2018 as part of a $15 billion buyout of GGP. Brookfield took out the $475 million loan in 2020. Institutional Mall Investors is an investment partner with Brookfield.

The recent $700 million refinance highlights the recovery of the Oakbrook Center, which has lost major tenants such as Lord & Taylor and Sears in recent years.

The refinancing move is the second-largest such deal on a shopping mall in 2023, trailing Unibail-Rodamco-Westfield’s $925 million refinancing of Westfield Century City in Los Angeles, the outlet reported.

The loan, set to replace debt maturing in November, is a five-year, interest-only term with a rate of 7.65 percent, slightly lower than the current CMBS loan’s rate of 7.73 percent

Morgan Stanley is the main provider of the loan, while Wells Fargo, Citi and Goldman Sachs participate.

Oakbrook Center, established in 1962, is the second-largest mall in the Chicago area. Since 2015, it has seen roughly $90 million in upgrades, including a new food hall, parking deck renovation and updates to AMC theaters. Furthermore, $177 million is earmarked for renovations of retail space to attract new tenants.

The mall is 88 percent leased and generated $971 million in sales last year, a significant increase from the pre-pandemic figure of $806 million in 2019, the outlet reported.

—Quinn Donoghue