Less than a year ago, the lender that holds the mortgage on North Riverside Park Mall, 7501 Cermak Road, initiated foreclosure proceedings after the shopping center’s owner defaulted on the loan.
But, that foreclosure threat appears to have been kept at bay, for now, according to a recent filing with the U.S. Securities and Exchange Commission.
On May 3, JPMBB Commercial Mortgage Securities Trust 2014-C24, which lists the North Riverside Park Mall mortgage among a bundle in that trust, stated in its filing that “a loan modification to extend the [loan’s] Oct. 2019 maturity date has been conditionally approved by the lender” and that the special servicer assigned to the loan was working with the lender to close the deal.
A loan modification would spell the end of the foreclosure action, filed by the trust in the Chancery Division of Cook County circuit Court last July. The online court case docket indicates it’s been stricken from the judge’s schedule as of January.
North Riverside Park Mall’s owner is an entity called North Riverside Park Associates, which is affiliated with The Feil Organization, a company that operates shopping malls in Illinois, Indiana, Louisiana and New York.
North Riverside Park Associates owes about $67 million on the loan, which matured Oct. 6, 2019, when a balloon payment of about $68 million was due. When they failed to make that payment, the loan went into default and the lender assigned LNR Partners to service the North Riverside Park Mall loan as the lender explored foreclosure.
While, last year’s foreclosure suit appears dead, there are still clouds on the horizon. The appraised value of the 1 million-square-foot North Riverside shopping center, about half of which is owned by North Riverside Park Associates, keeps plummeting.
In 2014, according to an SEC filing at the time, the property was appraised at $129 million. By the end of 2019, that appraised value had fallen to $48.8 million.
In the most recent SEC filing on May 3, the appraised value of North Riverside Park Mall is listed at $33 million – less than half what North Riverside Park Associates owes on the loan.
The mall got some good news last year when it learned J.C Penney, which had filed for Chapter 11 bankruptcy protection, would keep its North Riverside store open as it exited bankruptcy late in 2020.
But the former Carson Pirie Scott anchor location and more than half of the former Sears anchor property remain vacant as shopping malls battle to stay relevant in an era where big-box retail sales continue to struggle against online retailers, coupled with service interruptions brought on by a global pandemic.
Glenn Lindholm, general manager for North Riverside Park Mall, declined to comment on the news of an impending loan modification, but said foot traffic is up at the shopping center and that officials there continue to work on new lease deals with retailers and other businesses.
“We’re seeing a nice turnaround, and we’re hopeful it will continue and put us where we need to be,” Lindholm said.