South Jersey Mall Owner PREIT Reports $29.2M Loss Amid Pandemic

CHERRY HILL, NJ — The owner of several South Jersey malls reported a total loss of $29.2 million over the last three months amid the coronavirus pandemic.

The Pennsylvania Real Estate Investment Trust (PREIT) reported the losses on Tuesday. PREIT owns malls in Cherry Hill, Moorestown and Vineland, and is part-owner of the Gloucester Premium Outlets and Fashion District Philadelphia.

It said a loss of $20.1 million in revenue for the second quarter of the year was related to bankruptcies, store closings, increase in credit losses for its tenants, rental abatements and decreased sales.

Revenues were $56.8 million, compared to $81.4 million over the same period last year, when the mall reported a loss of $12.6 million.

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“We continue to be appreciative of our PREIT associates for executing on all aspects of our plan to get through this challenging period. Our resolve in creating the best overall consumer experience remains,” PREIT Chairman/CEO Joseph F. Coradino said. “Long before this pandemic hit, we were responding to changes in consumer behavior. Our properties have superior market positioning as dominant retail hubs, and we believe they will continue to gain market share as we strengthen them into commerce districts that include apartments, hotels, storage and last-mile fulfillment, medical and other uses. Our go-forward capital allocation priorities are to ensure that only the best opportunities to bolster our underlying earnings stream are pursued.”

The reporting period ends June 30. The malls were among the non-essential businesses that were closed from the middle of March until the beginning of July to help stop the spread of the coronavirus.

Since the malls reopened, mall traffic is about 68 percent of what it was last year during the non-holiday season, according to PREIT. Cash collections from April through July were 53 percent of total billings. PREIT has reached deferral agreements with 60 percent of its key national tenants.

It has laid off 31 employees and cut capital spending by $26 million for the year. It said it is moving forward with plans to sell land for development at several properties, including plans for the Moorestown Mall.

It also suspended shareholder dividends and amended agreements with lenders to temporarily suspend “certain financial covenants” for its debts. Coradino is only taking 25 percent of his salary from July 27 through Sept. 30.

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