PREIT’s Cherry Hill mall subsidiaries amend promissory notes, loans

Chicago, Dec. 21 – PR Cherry Hill STW LLC and Cherry Hill Center, LLC, subsidiaries of bankrupt parent Pennsylvania Real Estate Investment Trust, entered into a loan extension, modification and commitment to restate $300 million loans that are evidenced by promissory notes on Dec. 14, according to an 8-K filing with the Securities and Exchange Commission.

The entities have $150 million promissory notes with each of New York Life Insurance Co and with Teachers Insurance and Annuity Association of America from Aug. 15, 2012.

Both loans evidenced by the notes will be extended to a maturity date of the earlier of Feb. 15, 2025 or an initial failed milestone date, if any.

Interest will be the two-year Treasury rate plus 275 basis points or 7.25%, whichever is greater.

Each loan will require monthly interest payments and amortization payments using an assumed principal balance of $114,453,252 and a continuation of the 30-year amortization schedule.

There will be successive extension options.

The borrowers need to pay an additional $7.5 million of the outstanding principal balance on each notes and the bankruptcy court needs to enter a final order approving a DIP facility by Feb. 12, 2024.

The effective date of the agreements would be Feb. 15, 2024.

PREIT is a Philadelphia-based real estate investment trust. The company filed Chapter 11 for a second time on Dec. 10 under case number 23-11974. The borrowers are both subsidiaries that own Cherry Hill Mall.

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