$36.9M Loan on Berkshire Mall in Mass. Goes to Special Servicer

A $36.9 million loan on the Berkshire Mall at Old State Road and Route 8 in Lanesborough, MA has been transferred to a special servicer due to a sixty-day payment default, according to Fitch.

Trepp loan data and servicer watchlist notes prior to the transfer show a $14.5 million appraisal reduction on the property in July 2012. Trepp’s report also shows 26 percent of the mall’s leases are up in the next two years, one of which is Regal Cinema, which occupies 5 percent of the property.

The collateral on the 715,146 square foot regional mall loan consists of 192,793 square feet of in-line space and 396,353 square feet of anchor/major tenant space, according to Fitch. The non-collateral anchor space occupied by Target totals approximately 126,000 square feet.

The loan on the mall, which is in the Berkshire Mountains and less than a mile from Pittsfield, Mass, is sponsored by The Pyramid Companies.

In March 2012, a two-year forbearance through March 2014 was executed after the borrower was unable to refinance the loan at its extended maturity, according to Fitch. Per the forbearance agreement, the borrower contributed $250,000 in new equity to a rollover reserve. In addition, the loan is subject to hard cash management requiring excess cash flow be applied to an excess cash flow reserve (up to $300,000), then to a rollover reserve (up to $4 million), and then to amortize the loan.