The four malls are the 335,000-square-foot Bradley Square in Cleveland, TN; the 556,000-square-foot Martinsburg Mall in Martinsburg, WV; Shenango Valley Mall, a 509,000-square-foot property in Hermitage, PA; and the 478,000-square-foot Mount Berry Square in Rome, GA. They comprise four of the five mall properties Lightstone acquired for $120 million from Pennsylvania Real Estate Investment Trust in 2004. The fifth mall property in the PREIT deal--the West Manchester Mall in York, PA--was not included in the mortgage.

According to a release from Fitch Ratings, the $73.6-million loan on the malls was transferred to special servicing last October "due to imminent default." The loans were given through JPMorgan Chase Commercial Mortgage Securities Trust in 2006. By the end of Q1 2008, the debt service coverage ration on the four malls had declined to 0.95, according to Fitch.

The Fitch release from December says that Lightstone "approached the lender indicating that they would like to surrender the properties and is cooperating in the appointment of a receiver." The Wall Street Journal reported that the portfolio of malls was also carrying $18.2 million in mezzanine and secondary debt. A Lightstone spokesman did not respond to requests for comment by deadline.