LA Mall Lands $925M Loan

Westfield Century City underwent a $1 billion redevelopment that was completed in 2017, when this archived photo was taken. Image courtesy of Unibail-Rodamco-Westfield

Bank of America, JP Morgan and Morgan Stanley are set to originate a $925 million non-recourse, first lien mortgage for Unibail-Rodamco-Westfield on Aug. 17. The debt is collateralized by the retail owner’s 1 million-square-foot interest in Westfield Century City, a 1.4 million-square-foot mall on Los Angeles’ Westside.

The floating-rate loan will have an initial two-year term, with three one-year extension options and will require monthly interest-only payments based on a one-month term Secured Overnight Financing Rate, according to Kroll Bond Rating Agency. KBRA has assigned preliminary ratings to five classes of CENT 2023-CITY, a CMBS single-borrower securitization collateralized on the $925 million mortgage.

Word of the impending loan emerged on Tuesday in statements on rating actions by KBRA and Fitch Ratings.

Proceeds will be used to return some $909.5 million in equity to the borrower and to pay estimated closing costs of approximately $18.5 million, according to a report from Fitch. The rating agency also noted the property’s quality and prime location, as well as its reputation as one of the West Coast’s top malls.

Assigning Westfield Century City a property quality grade of ‘A’, Fitch noted that its three department store anchor tenants brought in nearly $200 million last year, the majority of it from Bloomingdale’s.

Westfield Century City, which opened in 1964 as Century Square Shopping Center, underwent a massive redevelopment program that was completed in 2017. That year, Paris-based Unibail-Rodamco acquired Australia’s Westfield Corp. in a nearly $16 billion transaction.