The company said it has a restructuring support agreement with creditors that own about 73% of its outstanding secured corporate debt and 67% of its unsecured notes — and importantly, the company also has secured $100 million in a debtor-in-possession loan to fund daily operations during the Chapter 11 process.
“Washington Prime Group’s guests, retailers and business partners can expect business as usual at all of the company’s retail town centers throughout the proceedings,” the company said in a release.
“The company’s financial restructuring will enable WPG to right size its balance sheet and position the company for success going forward,” said Lou Conforti, chief executive and director of Washington Prime Group. “During the financial restructuring, we will continue to work toward maximizing the value of our assets and our operating infrastructure. The company expects operations to continue in the ordinary course for the benefit of our guests, tenants, vendors, stakeholders and colleagues.”
The move is not a surprise. In a fourth quarter earnings report released in March, the business reported “there exists substantial doubt about the company’s ability to continue as a going concern.”
At that time, the company said it had reached an agreement with creditors extending until the end of the month a deadline to pay a $23.2 million interest payment that had been initially due Feb. 16.
A victim not only of the pandemic but of an increasingly weakened position for retail brick-and-mortar nationwide, Washington Prime has seen mall anchors and regular-size tenants sliding into bankruptcy and shuttering their stores. Elder-Beerman and Sears in 2018 closed locations at both Dayton Mall and The Mall at Fairfield Commons.
Mall owners CBL Properties and PREIT also filed for Chapter 11 last November, with those companies having previously warned they were in challenging positions because some of their largest tenants, including JC Penney, had started their own stints in bankruptcy.
Shoppers at the Dayton Mall on Monday said they were not aware the mall owner had filed for bankruptcy.
“It doesn’t surprise me. As the larger stores keep closing, I’m sure they’re going to have more trouble,” said Lisa Short of Miamisburg, who was shopping with her daughter.
Glimcher Realty Trust — which at one time owned and operated the Dayton Mall and the Mall at Fairfield Commons — was bought out by Washington Prime Group in 2014.
Messages seeking comment were sent to representatives of WPG and the local malls Monday.
The company owns more than 100 locations across the United States. In addition to its two local malls, the company owns seven other Ohio properties:
· Great Lakes Mall in Mentor
· Indian Mound Mall in Heath
· Lima Mall in Lima
· New Towne Mall in New Philadelphia
· Polaris Fashion Place in Columbus
· Southern Park Mall in Youngstown
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