PREIT, owner of several Philadelphia area malls, files for Chapter 11 bankruptcy
PHILADELPHIA (CBS) -- The company that owns several malls in the Philadelphia region has filed for Chapter 11 bankruptcy.
The Pennsylvania Real Estate Investment Trust owns seven malls in Pennsylvania and South Jersey, including the Fashion District, Cherry Hill Mall and Willow Grove Malls.
The malls are staying open, and vendors and suppliers will be paid. The company is working to restructure its finances and reduce its debt by about $880 million.
The company also filed for bankruptcy in November 2020 during the height of the pandemic.
"We are pleased to be moving forward with strengthening the Company's balance sheet and positioning it for long-term success through this Prepackaged Plan. Following the pandemic disruption, PREIT has worked tirelessly to enhance the portfolio, dramatically improve occupancy and diversify its tenancy. However, unusual economic conditions have limited the Company's options with respect to its debt obligations as meaningful achievements on the operating front were met with inflation and rising interest rates," Joseph F. Coradino, the Chairman and CEO of PREIT, said in a release. "Today's announcement will position a restructured PREIT to execute on strategic initiatives to continue transforming its portfolio for the tenants and communities it serves. We look forward to quickly emerging from this process as a financially stronger company with the resources and support to continue creating diverse, multi-use property experiences throughout our portfolio."
The location of the Fashion District in Market East is the site for the proposed Philadelphia 76ers arena.
David Adelman, the chairman of 76 Place, wrote on X the bankruptcy filing doesn't impact the Sixers' plans to potentially build a new arena.
"This does not affect our plans or ability to deliver a $1.5 billion world-class arena and residential building," Adelman wrote.
