Maricich: Reports of Default "Old News"

September 21, 2010  by in UnCategorized   

By Home Furnishings Business in Las Vegas on September 22, 2010

A Las Vegas Business Press report that World Market Center has defaulted on mortgages is old news, WMC CEO Bob Maricich said in a telephone interview Tuesday.

The report said World Market Center was in default on loans for buildings A and B, and Maricich said that relates to WMC's efforts to restructure its long-term debt.

"The story started at the end of last year when we said it was inevitable we'd have to alter our underpinning, our debt structure," Maricich said, noting that the only way to renegotiate WMC's loan structure was to "get in front of a special (loan) servicer, which we did at the beginning of the year."

Centerline Capital Group is the special servicer for WMC's loans on buildings A and B.

"In April we had a technical default to get in front of a loan servicer," Maricich said.

Technically, any violation of a loan's provisions--i.e., lease rates other than those specified in the agreement--can result in default.

"We had to modify some leases," Maricich said. "We've helped our tenants in accordance with being a good partner during unprecedented economic conditions."

Negotiations with Centerline continue to restructure the loans.

"Those talks have been ongoing, and they've been productive, with the understanding that we want the best outcome for all stakeholders," Maricich said.

Maricich emphasized that World Market Center is not in foreclosure, and that a forebearance agreement to avoid foreclosure proceedings on lenders' part--originally through August 31--remains in effect.

"It's been renewed twice, and again, because both parties want to work out a favorable solution," he said.

The report included nothing that hadn't been on record for some time, Maricich added: "Here was a report citing information that's been out since April that World Market Center has responded to in the past."