Polaris mall owner moves closer to bankruptcy
Washington Prime Group, the Columbus-based owner of shopping centers including Polaris Fashion Place, appeared to slide closer to bankruptcy this week.
In its fourth-quarter earnings report, Washington Prime said “there exists substantial doubt about the company’s ability to continue as a going concern.”
Washington Prime said it had reached an agreement with creditors extending until March 31, the deadline to pay a $23.2 million interest payment it missed in February.
But the company cast doubt on its ability to make the deadline and avoid Chapter 11.
“The company is continuing to engage in negotiations and discussions to restructure its capital structure,” the company reported, but acknowledged “the uncertainty associated with the company’s ability to meet these obligations.”
Washington Prime disclosed that its discussions with lenders have included bankruptcy in addition to renegotiating the terms of the loans.
“Although the company continues to be open to all discussions with the holders of the notes and its other stakeholders regarding a potential restructuring, there can be no assurance the company will reach an agreement.”
Washington Prime said it expects business to continue as usual at its centers as it struggles to resolve its finances.
“The company expects to continue to provide quality service to its customers without interruption,” it reported.
Washington Prime’s challenges were illustrated in its earnings report, which showed the company lost $111.4 million, or $5.24 per share, in the last three months of the year, compared with a profit of $17.1 million (81 cents per share) in the same period in 2019.
For all of 2020, Washington Prime lost $233.8 million, compared with a loss of $11 million in 2019.
Like other mall operators, Washington Prime saw its revenue hammered last year by tenants who were unable to pay full rent or simply closed during the pandemic. Dozens of retailers filed for Chapter 11 in 2020, many of them mall standards such as Brooks Brothers, J. Crew, Pier 1, Aldo and GNC.
Washington Prime’s rent revenue fell from $633.6 million in 2019 to $506.7 million in 2020.
Washington Prime is among many shopping center owners struggling during the pandemic, as consumers shopped online instead of in person. In November, two companies, CBL Properties and PREIT, which together own 130 shopping centers, filed for Chapter 11. The same month, Simon Property Group indicated that it would allow two
malls, including the Mall at Tuttle Crossing in Dublin, to fall into bankruptcy.
Washington Prime’s challenges were compounded this month by two shootings at Polaris Fashion Place, which forced the temporary evacuation of the mall.
Washington Prime operates 100 shopping centers, concentrated in the Midwest, East Coast and Florida.
In addition to Polaris Fashion Place, the company owns eight Ohio centers:
Indian Mound Mall in Heath; the Mall at Fairfield Commons in Beavercreek; Dayton Mall; New Towne Mall in New Philadelphia; Lima Mall and Lima Center; Great Lakes Mall in Mentor; and Southern Park Mall in Youngstown.
The company’s stock continued its decline Wednesday, falling to $2.74 a share, down from almost $15 a share at the end of January. jweiker@dispatch.com @Jimweiker