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SEC Filings

10-K
WASHINGTON PRIME GROUP INC. filed this Form 10-K on 02/24/2017
Entire Document
 
Washington Prime Group Inc. and Washington Prime Group, L.P.
Notes to Consolidated and Combined Financial Statements (Continued)
(dollars in thousands, except share, unit, per share and per unit amounts and
where indicated as in millions or billions)


On August 8, 2016, we received a notice of default letter, dated August 4, 2016, from the special servicer to the borrower concerning the $44.9 million mortgage loan secured by River Valley Mall. The letter was sent because the borrower, a consolidated subsidiary of the Company, did not repay the loan in full by its January 11, 2016 maturity date. On December 29, 2016, we transferred title of the property to the mortgage lender pursuant to the terms of a deed-in-lieu of foreclosure agreement entered into by the Company's affiliate and the mortgage lender.
On October 8, 2015, we received a notice of default letter, dated October 5, 2015, from the special servicer to the borrower of the $52.9 million mortgage loan secured by Merritt Square Mall.  The letter was sent because the borrower, a consolidated subsidiary of the Company, did not repay the loan in full by its September 1, 2015 maturity date. On May 25, 2016, the trustee on behalf of the mortgage lender conducted a non-judicial foreclosure sale of Merritt Square Mall, in which the Company's affiliate previously held a 100% ownership interest. The mortgage lender was the successful bidder at the sale and ownership transferred on June 9, 2016. The Company managed the property through and including July 31, 2016.
On October 30, 2015, we received a notice of default letter, dated that same date, from the special servicer to the borrower concerning the $62.4 million mortgage loan that matures on February 1, 2017 and was secured by Chesapeake Square.  The default resulted from an operating cash flow shortfall at the property in October 2015 that the borrower, a consolidated subsidiary of the Company, did not cure. On April 21, 2016, the trustee on behalf of the mortgage lender conducted a non-judicial foreclosure of Chesapeake Square, in which the Company's affiliate previously held majority ownership interest. The mortgage lender was the successful bidder at the sale and ownership transferred on April 28, 2016.
Upon the ownership transfers of River Valley Mall, Merritt Square Mall, and Chesapeake Square, the Company recognized a net gain of $34.6 million based on the cancellation of outstanding mortgage debt of $160.1 million, which is included in gain on extinguishment of debt, net in the consolidated and combined statements of operations and comprehensive income (loss) for the year ended December 31, 2016.
At December 31, 2016, management believes the applicable borrowers under our other non-recourse mortgage loans were in compliance with all covenants where non-compliance could individually, or giving effect to applicable cross-default provisions in the aggregate, have a material adverse effect on our financial condition, results of operations or cash flows. In addition to the properties mentioned above, we have identified Valle Vista Mall as over-levered. We expect to commence discussions with the special servicer on the loan encumbering this property prior to loan maturity. The Company has assessed each of these properties for impairment indicators and has concluded no impairment charges are warranted as of December 31, 2016.
Debt Maturity and Cash Paid for Interest
Scheduled principal repayments on indebtedness (including extension options) as of December 31, 2016 are as follows:
2017
 
$
346,050

2018
 
39,032

2019
 
968,309

2020
 
846,710

2021
 
273,354

Thereafter
 
1,034,974

Total principal maturities
 
3,508,429

Bond Discount
 
(47
)
Fair value adjustments, net
 
12,661

Debt issuance costs, net
 
(14,639
)
Total mortgages and unsecured indebtedness
 
$
3,506,404

Cash paid for interest for the years ended December 31, 2016, 2015 and 2014 was $125,999, $124,646 and $81,607, respectively.

F-38

©2013- WASHINGTON PRIME GROUP