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Mills Gets Default on Credit Line

ARLINGTON, VA-Executives say the default, the potential to borrow and a new mortgage on Sawgrass Mills could strengthen the company.

By Ian Ritter | Updated on April 12, 2006

ARLINGTON, VA-Troubled retail-REIT the Mills Corp. received waivers of default from its lenders through Dec. 31, which also permit new borrowings, under certain conditions, of up to $341 million. Mills is also in the process of obtaining waivers on the construction loans of four of its completed projects.

The company is currently exploring a sale and is under investigation by the SEC for accounting flaws. Mills is restating its financials from 2000 through last year after its third-quarter NOI and FFO dropped due to the failure to collect rents, charges on projects under construction and other factors. For previous coverage, click here.

Meanwhile, JP Morgan provided the company with a $625-million mortgage on Sawgrass Mills, a center in Sunrise, FL, to replace a $268-million mortgage and $74 million in mezzanine financing. Executives expect to generate about $246 million in proceeds from the deal.

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