Sierra Club: American Dream Mall is a financial nightmare
American Dream Mall is a financial nightmare
The American Dream Mall in East Rutherford faces more challenges. Ameream, LLC., The Triple Five company that owns the American Dream website, has filed a lawsuit against Villa Restaurant Group for breach of its contract. Villa Restaurant Group signed a lease in June 2015 to open a Green Leaf and Tony + Benny’s pizzeria in the mall, but construction is still not complete. A number of construction companies have filed liens against the property saying they owe nearly $ 41 million for the completed work.
“American Dream tries to twist the facts to put the blame on them. The American Dream / Xanadu Mall hasn’t paid its contractors, but they blame two of the restaurants that are supposed to go into the mall. They say that Villa Restaurant Group, the owner of the two restaurants, has broken their contract because construction is not completed. However, the owners of the American Dream owe $ 41 million for the work the construction workers have already done, ” said Jeff Tittel, director of the New Jersey Sierra Club. “It’s a model with them, it’s not just the coronavirus that closed the mall and caused the problems. Retail is going to change drastically because of the coronavirus, so there is no guarantee that this mall will open or refund all funding it has received. “
The American Dream / Xanadu Mall was scheduled to open in March 2020, but has delayed opening due to the coronavirus pandemic. The mall reopened on October 1, 2020 even though indoor entertainment venues were allowed to reopen in New Jersey as early as September.
“The American Dream Mall is truly a financial nightmare. He’s had problem after problem after problem for almost two decades. They only had a partial opening in October, with many shops and attractions still under construction. Several of the tenants on offer like Forever 21 and Bath and Body Words were in financial difficulty even before the pandemic. Tenants like It’Sugar and Barneys have filed for bankruptcy and will now have to be replaced ”, says Jeff Tittel. “It’s a shame that the mall owners are suing tenants for not opening when the mall itself is in so much trouble. Triple Five owes nearly $ 41 million for the completed construction work, and they face a myriad of other financial issues, like 2 missed mortgage payments and billions of dollars in construction loans.
Triple Five, the developer of the American Dream Mall, missed two monthly mortgage payments for Mall of America in Minnesota earlier this year. Last year, Triple Five pledged a 49% stake in Mall of America and another property as security for a $ 1.67 billion construction loan for the American Dream Mall in East Rutherford, NJ. In another setback, the American Dream Mall had to lay off about 100 employees earlier this month.
“Owner after owner, year after year, has achieved the same with contractors. From Empire Mall to Xanadu, from Mills Corporation to Rockland Capital. It’s just another financial problem in a long line of financial problems. American Dream had to lay off more than 100 employees, and the mall owners also missed two mortgage payments that are a guarantee for the American Dream. If they default on that mortgage, it affects the financing of the American Dream, which then affects the financing that New Jersey has put in place, ” says Jeff Tittel. “When the mall reopens, they will still have to follow social distancing protocols and limit the number of people. If people want to go there once it reopens, a daily visit to the mall is extremely expensive. “
The American Dream / Xanadu mega-mall is the largest subsidized public development project in state history. The project received $ 350 million in direct state grants from EDA, plus an additional $ 800 million for funding, including $ 100 million for road improvements, bringing it to $ 1.5 billion. dollars.
“This project should be called the American Nightmare because it just keeps getting worse. Whenever there is a problem with this mega mall, they expand it and spend more public money on it. This mall is cursed and unfortunately it is on state-owned land funded with public money. We supported this project with $ 1.2 billion of public money that could have been used to build schools, remove lead from drinking water or clean our sites ”, said Jeff Tittel, director of the New Jersey Sierra Club. “We should really call them the American regime for all the grants, money and loans that they got from New Jersey taxpayers. Not only are they not creating jobs, but they are failing to pay entrepreneurs during the pandemic at a time of extreme financial uncertainty. “
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