Failed American Dream falls behind on $8.8 million loan repayment
Canadian Real Estate Giant Triple Five Group Fails to Make $8.8 Million Payment on American Dream Mall Debt
The Canadian real estate conglomerate, Triple Five Group, has missed an $8.8 million payment on debt associated with their American Dream mall in New Jersey, as stated in a notice to bondholders from U.S. Bank Trust Co.
The overdue payment, due on Aug. 1, has left the reserve account, historically used for debt payments, bereft of sufficient funds, the notice revealed, with the balance in the account standing at $862.12.
Triple Five Group and American Dream have not responded to requests for comment as of press time.
The American Dream, a sprawling 3-million-square-foot retail project, has faced steady financial struggles since its long-anticipated opening in 2019. Its debut was met with immediate hurdles due to the pandemic, and last year, Triple Five put up assets like the Mall of America as collateral after defaulting on American Dream's debt, leading to a substantial $60 million loss in 2021.
The mall nearly defaulted on another bond payment in June, submitting a late payment of $13.9 million, but its financial standing remained precarious until it paid $315,000 in overdue interest to bondholders.
In a positive development, its indoor ski slope, "Big Snow," recently reopened after a major fire forced its closure earlier in the year. The mall is still carrying on, though, hosting events like the "Anti-Bummer, End-of-Summer Bash" through Aug. 25, which features retail establishments and major attractions.
However, the mall's financial challenges persist. The mall's assessed value dropped sharply by $800 million in 2025, from $3.3 billion to $2.5 billion, directly impacting its annual Payment In Lieu Of Taxes (PILOT) payment. The reduced valuation and PILOT payment have left the mall unable to cover its full annual debt service of $54.1 million.
Further hindering the mall's financial stability has been its reliance on reserves, currently amounting to about $38 million, to cover its debt obligations, with the next semiannual interest payment of $27 million due on June 1, 2025. In February 2025, the mall missed an interest payment on its municipal bonds, signaling financial distress.
If Triple Five fails to repay principal amounts as scheduled, the maturity of the bonds may be extended to December 1, 2056. After this date, bondholders shall no longer be eligible for additional payments regardless of the remaining debt.
In summation, the American Dream mall is grappling with substantial financial difficulties, demonstrated by missed bond payments, decreased property valuation, and limited reserve funds. Even as the mall moves forward with events like the "Anti-Bummer, End-of-Summer Bash," it continues to navigate pressing financial challenges.
- The Triple Five Group's financial troubles, including missed payments on American Dream's debt, could potentially impact their future investing ventures, particularly in real-estate and business sectors.
- Amidst the ongoing pandemic, the financial instability of the American Dream mall, such as missed payments and dropping property values, might deter potential investors looking to invest in similar real-estate projects.
- The volatile financial situation of the American Dream mall raises questions about the AI-driven financial models' ability to accurately predict and navigate such crises, especially during a pandemic when traditional economic indicators are less reliable.
