Lloyd Center Foreclosure: Lender Says Mall Owes $110 Million

PORTLAND, OR — The Lloyd Center, once the largest mall in the world, is once again on hard times. They owe $110 million and the lending company says that they're ready to foreclose on the property.

In a call last week, KKR Real Estate Trust announced that Lloyd Center has not made payments on their loan since October 2020.

“We intend to foreclose and to take ownership of the asset, enabling us to optimize value over the near and medium term,” president and chief operating officer of KKR Real Estate Finance Trust Inc., Patrick Mattson, said during the call.

The loan on the Lloyd Center, once the largest mall in the world, was originated in 2015 and put on non-accrual status last October, with a $40.3 million credit loss, according to a ...

KKR now plans to foreclose and develop the property though they haven't gone into detail about what that would involve beyond saying it would likely involve offices and apartments. They haven't said if retail would remain.

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The mall opened in 1960 with 100 stores.

While the pandemic did the area no favors, Lloyd Center was in trouble before that.

Major chains such as Marshalls and Nordstrom both left before 2018 as the number of shoppers started declining. The mall developed a somewhat dangerous reputation as violence started to rise in the city.

There have been several redevelopment efforts in recent years and talk of other plans that never materialized.

KKR first loaned money to the 1.1 million square foot mall in October 2015 so that they could refinance their outstanding loans at the time.