Pennsylvania Real Estate Investment Trust (NYSE: PEI) announced today that it has completed favorable amendments to the terms of three mortgage loans on Lycoming Mall, Viewmont Mall and Francis Scott Key Mall. PREIT has refinanced these mortgages for an aggregate amount of $146.1 million at an average interest rate of 3.91% over terms of five years. These transactions generated excess proceeds of approximately $9.7 million and reduced average interest rates by 172 basis points, after giving effect to interest rate swaps entered into in connection with these loans.
The loan on Lycoming Mall was increased from $33.4 million to $35.5 million and the interest rate was reduced from 6.84% to 3.72%. The loans on Viewmont Mall and Francis Scott Key Mall, after giving effect to previously in-place swaps, will carry interest rates of 5.50% and 5.26%, respectively, through November 2013 and then drop to fixed rates of 3.72% and 3.71%, respectively, for the remainder of their respective terms. The loan on Francis Scott Key Mall was increased from $55.0 million to $62.6 million, and contains an option to increase the balance further to $70.5 million under prescribed conditions.
“The completion of these transactions is further evidence of success in the Company’s ongoing effort to lower its overall financing costs while extending its maturity profile,” said Joseph Coradino, Chief Executive Officer of PREIT. “We are pleased with our continued ability to achieve attractive financing terms on properties across the portfolio.”
Lycoming Mall is a 0.8 million square foot regional mall with sales per square foot of $270 as of December 31, 2012. Viewmont Mall is a 0.7 million square foot regional mall with sales per square foot of $370 as of December 31, 2012. Francis Scott Key Mall is a 0.7 million square foot regional mall with sales per square foot of $344 as of December 31, 2012. All three malls are anchored by jcpenney, Macy’s and Sears stores. Each property is wholly owned by the Company.