The Real Deal Miami

Related’s CityPlace in West Palm facing default over $150M loan

Despite loan trouble, Related wants to expand shopping center

February 10, 2016 10:30AM

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CityPlace in West Palm Beach (Credit: Stephen K. Hill)

CityPlace in West Palm Beach (Credit: Stephen K. Hill)

CityPlace, a shopping center owned by the Related Cos. in downtown West Palm Beach, is reportedly in trouble over its loan — again.

The retail complex’s loan was recently placed in special servicing, which means a third party, in this case C-III Asset Management, will assess if the loan can be rescued or if it should head to foreclosure, the South Florida Business Journal reported.

This isn’t the first time CityPlace has faced troubles over its loan: the 698,472-square-foot development’s mortgage topped a 2011 list for South Florida’s biggest delinquent mortgages several months in a row.

Some of the factors affecting CityPlace: declining occupancy rates, down to 89 percent from 92 percent in 2014, and a roughly 3.4 percent spike in the loan’s interest rate last year, according to the Business Journal.

That interest spike means CityPlace’s net income barely covers its loan payments.

Despite this, New York-based Related, headed by real estate tycoon Stephen Ross, had approached West Palm Beach late last year to talk about expanding the shopping center. [SFBJ] — Sean Stewart-Muniz

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