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Westfield Broward owner turning mall over to lender

Murky future of Plantation shopping center signals how retail must adapt

The Plantation mall's owners haven't been paying off a $95 million loan in over a year, according to a research firm.
The Plantation mall's owners haven't been paying off a $95 million loan in over a year, according to a research firm.

PLANTATION, Fla. – Westfield Broward Mall has not made a payment on its $95 million loan covering 320,000 square feet of space since April of 2020, according to a research firm, and the mall’s owners confirm they are turning over the property to lenders.

“As part of our continued strategy to rebalance our portfolio and divest certain assets, Westfield Broward in Plantation, Florida will be turned over to our lender and managed by a third-party receiver,” a spokesperson for Unibail-Rodamco-Westfield said in a statement to Local 10 News on Thursday. “We are committed to ensuring a smooth transition to new ownership, with the center remaining open and operating throughout the process to serve the community.”

The move comes amid concerns about the future of brick-and-mortar retail. Unibail-Rodamco-Westfield has signaled plans to sell all its U.S. mall properties.

“Westfield has already announced plans to exit the U.S. market over the coming years and will be shedding all of its U.S. assets, so it appears that the loan has already been delinquent for some time and that Westfield is in the middle of negotiating a consensual return of the property to the lender,” a spokesperson for the research firm Trepp told Local 10 News.

Westfield Broward Mall, located at 8000 West Broward Blvd., had a commercial mortgage-backed securities (CMBS) loan, Trepp said, adding that “the collateral was valued at $166.8 million in 2013. It was later lowered to $57.8 million.”

Analysts have said the COVID-19 pandemic accelerated consumer buying trends toward online shopping.

The management consulting firm McKinsey & Company found last year that “e-commerce sales in apparel, department stores, and beauty products have increased by nearly ten percentage points, on average, since the onset of the pandemic.”

Another problem is that there are too many malls, says Beth Azor, a Weston-based commercial real estate and retail shopping consultant and investor.

“Most real estate developers, when we need one thing we build 30,” she said. “So, in South Florida, we have 21 malls. We probably need about 15. We don’t need 21 malls for the demographics and the population we have in South Florida. So, we over-built. That’s the main problem.”

And you know the adage: location, location, location.

“Broward Mall was kind of an interior location,” Azor said, lacking the kind of tourist traffic she says gives lift to properties like Aventura Mall and Sawgrass Mills.

“I don’t think locals can support all of the malls,” she added. “We dilute ourselves.”

The National Retail Federation says that based on their 2021 revised forecast, they expect e-commerce to account for approximately 24.2%- 25.1% of total retail sales this year.

Azor says that percentage is evidence that there is a future for brick and mortar retailers, including malls, as long as they have a good location for foot traffic and showcase unique product offerings.

“The ones who will thrive,” she said, “will be the ones with location attention and tourist attraction. It will only be the ones in phenomenal locations.”

McKinsey & Company’s January 2020 “Future of retail” report sent a similar message.

“Brick-and-mortar retail stores need to up their game,” it said. “Retail stores have a real future Yet rumors of the physical store’s death are exaggerated. Even by 2023, e-commerce is forecast to account for only 21 percent of total retail sales and just 5 percent of grocery sales. And with Amazon and other major internet players developing their own brick-and-mortar networks, it is becoming increasingly clear that the future of retail belongs to companies that can offer a true omnichannel experience.”


About the Author:

Christina returned to Local 10 in 2019 as a reporter after covering Hurricane Dorian for the station. She is an Edward R. Murrow Award-winning journalist and previously earned an Emmy Award while at WPLG for her investigative consumer protection segment "Call Christina."