The American Dream mall’s financial woes continue to pile up.
Two lenders filed a lawsuit alleging a breach of contract by Triple Five Group, the owner of the beleaguered retail and entertainment center in New Jersey, NorthJersey.com reported. Bloomberg Law first reported the suit by an administrator representing Western Asset Management and South Korea-based Nonghyup Bank.
The lawsuit, filed last week in New York State Supreme Court, seeks $389 million on behalf of the firms. A spokesperson for the American Dream declined to comment to NorthJersey.com regarding the lawsuit.
At the heart of the lawsuit is an extension Triple Five recently received to pay off its debt on $1.7 billion in construction financing. Senior lenders in November gave the mall owner a four-year extension on the loan, taking the debt to October 2026. That extension effectively cut out the two junior lenders, according to The Bond Buyer trade newspaper.
The lenders’ attorneys did not respond to a request for comment from NorthJersey.com.
It’s the latest wrinkle at the East Rutherford retail complex that’s had its fair share of issues during its brief run.
Don Ghermezian’s firm this month missed an $8.8 million semiannual debt service payment for interest due on $290 million in municipal bonds. Triple Five claimed the state bore the responsibility of releasing the funds to make that payment, at least the second time it has made that argument.
In June, Triple Five missed a semiannual payment on an $800 municipal bond, which was ultimately paid later. The firm received $2.7 billion from banks and bondholders to complete the complex. In 2021, the mall reported $60 million in losses.
With the backdrop of the mall’s troubles, Asian supermarket chain H Mart is set to hold its grand opening at the complex this week. The debut comes four years after the store’s occupancy at the mall was announced.
— Holden Walter-Warner