Los Angeles mall owners are attempting to reinvent their properties before they become irrelevant — but not all of them have moved quickly enough to escape default.
A $142 million CMBS loan attached to Macerich’s Westside Pavilion mall, at 10800 W. Pico Boulevard near the Fox lot, has been transferred to special servicing, according to Trepp.
It was sent to Rialto Capital Advisors pending imminent default, the Commercial Observer reported. The 10-year loan was originated by Wells Fargo in September 2012 and had a balance of $150 million.
Macerich refinanced the mall in 2012 for $275 million, Real Capital Analytics data show. It had planned an open-air renovation of the 31-year-old West L.A. fortress, which would expand it into a 755,000-square-foot space, but it has not yet released very specific plans on the changes.
The mall has struggled with lease terminations, the Observer reported. Its occupancy fell roughly 20 percent from the time of the loan’s origination, according to information from Trepp.
Macerich did not immediately return requests from the Observer for comment.
In February, Macy’s sold its building within the Pavilion, which it separately owned, to GPI for $50 million.
L.A. mall owners have rushed, in recent years, to redevelop their dated properties into more Rick Caruso-esque experiential shopping centers with outdoor space.
Westfield’s Century City Mall, which is undergoing an $800 million transformation, nabbed Eataly, which is slated to open at the end of the month. Hyped to be Downtown L.A.’s retail hub of the future, Ratkovich Company has also faced financial trouble at the Bloc, its 1.1 million-square-foot office and retail redevelopment project. [CO] — Hannah Miet