Judge names receiver for Westfield San Francisco Centre mall

In response to a lenders’ lawsuit, a judge has named a receiver for the troubled Westfield San Francisco Centre mall.

Superior Court Judge Charles Haines has appointed Gregg Williams of Trident Pacific Real Estate Group to take over the city’s largest mall at 865 Market Street, the San Francisco Business Times reported.

The Newport Beach-based receiver will be paid $30,000 a month. The court is slated to confirm its appointment on Oct. 26. The lawsuit’s defendants, affiliates of Westfield America, have until Oct. 16 to file a response.

The lawsuit was filed late last month by lenders of more than $550 million in commercial mortgage-backed securities tied to the 1.45-million-square-foot property to foreclose on the Downtown mall, put it into receivership and then sell it, according to a story first reported by The Real Deal.

In June, the owners of the half-empty mall, faced with a looming exit by Nordstrom, announced they would surrender the property to its lenders. Westfield, a unit of Paris-based Unibail-Rodamco-Westfield, and co-owner Brookfield Properties, based in New York, ceased making payments on a $558 million loan tied to the nine-story property.

The lawsuit plaintiffs nominated Trident Pacific, with Williams as agent. A declaration filed by Williams describes his experience with more than 152 receiverships in 40 states, about half of them retail properties and more than a dozen over 100,000 square feet.

As part of the receivership, Westfield America’s borrower affiliates must turn over any financial assets and reports for the mall and answer questions from the receiver, which will begin collecting rents from tenants.

Williams declared that “the most significant issue relating to the mortgaged property is security.” He aims to beef up security with off-duty San Francisco cops, plus put guards and dogs at each entrance and around the mall.

The parent company of American Eagle has sued the mall owners for neglect, alleging they allowed it to become a magnet for crime.

JLL will serve as third-party manager and leasing agent for the San Francisco Centre, according to the court filing.

The receiver is authorized to negotiate contracts with the city pertaining to a $3.3 million-a-year ground lease.

No later than 60 days after the end of the receivership, Williams must file a final report and accounting of the mall’s finances. The receivership could end in a trustee sale, a judicial foreclosure or a settlement.

— Dana Bartholomew

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