Simon Property Group Misses Maturity on $295M Mall Loan

Simon Property Group looks for extension on 1.2 million-square-foot shopping center

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A $295 million loan backed by a large regional mall in Orange County, Calif., has matured and is now with the special servicer.

Owner Simon Property Group is looking for an extension on the 1.2 million-square-foot shopping center known as The Shops at Mission Viejo, according to a Trepp alert. A short-term forbearance might be in the works. 

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Simon officials did not return requests for comment and more information.

Trepp reported the shopping mall was valued at $543 million at securitization. But there are “serious headwinds in the market to refinance this asset … [and] market is tough as you can imagine,” Trepp said, citing watchlist comments from late last year.

The mall at 555 The Shops Boulevard is anchored by Macy’s and Nordstrom, and there are no looming lease expirations among the top tenants. The mall is near the junction of Crown Valley Parkway and Interstate 5.

Simon Property Group, a real estate investment trust based in Indianapolis, is the largest shopping mall operator in the country, and it manages shopping, dining, entertainment and mixed-use properties around the world. Earlier this month, the company said its portfolio’s occupancy rate was at 95 percent by the end of the fourth quarter last year, up 1.5 percent compared to 2021. Its base minimum rent per square foot was $55.13, which is 2.3 percent higher than the year prior.

Gregory Cornfield can be reached at gcornfield@commercialobserver.com.