American Dream Mall’s Bond Woes Deepen as February Payment is Missed

American Dream Mall’s Bond Woes Deepen as February Payment is Missed 

Edited by: TJVNews.com

The municipal bonds that helped finance the American Dream Mall, the massive retail and entertainment complex owned by the Ghermezian family’s Triple Five Group, have once again failed to make an interest payment, according to a recently published report by The Real Deal. This latest financial setback raises further concerns about the long-term viability of the debt-laden project, which has struggled to generate sufficient tax revenue to meet its obligations.

The unpaid bonds are specifically linked to sales tax collections from the mall and represent $287 million of the total municipal debt used to finance the ambitious development in East Rutherford, New Jersey, as was detailed in The Real Deal report. The bonds were issued through the New Jersey Economic Development Agency, which bears the responsibility of making payments to bondholders. However, in a recent filing disclosing the missed February interest payment, trustee US Bank offered little reassurance regarding future payments, stating that it could not provide any assurances about when or in what amounts future grant revenue distributions would be made.

The financial instability surrounding the American Dream Mall is nothing new, as The Real Deal has previously reported. Last August, bondholders received a partial grant revenue payment from the state totaling $26 million, which covered only a portion of the $46 million in overdue interest payments. Under the terms of the bond agreement, payments from the state’s grant program occur just once per year, leaving investors in prolonged uncertainty as they await funds tied to the mall’s tax revenue performance.

The American Dream Mall’s construction was financed in part through these unrated municipal bonds, which remain backed by New Jersey’s economic development grants. However, The Real Deal reported that since the bonds rely on tax revenue generated by the mall’s sales, their ability to sustain timely payments has been repeatedly called into question. Over the past two years, bondholders have waited in frustration as payment deadlines were missed repeatedly—though technically, Triple Five has not been declared in default.

Beyond its financial challenges, Triple Five has also found itself embroiled in a legal battle with the local government. The company has been in a heated dispute with the town of East Rutherford, claiming it has overpaid $183 million in property taxes. The report in The Real Deal indicated that Triple Five is currently appealing the mall’s property tax valuation, while East Rutherford is countering with legal action over missed payments. The core issue in this legal fight revolves around the valuation of the land beneath the mall. While the land has been officially assessed at over $3 billion, Triple Five has reportedly argued that it is worth only half that amount—a significant discrepancy that could have major financial implications for both the company and the municipality.

Despite the American Dream Mall’s initial promise as a groundbreaking retail and entertainment hub, its financial struggles continue to mount, as The Real Deal has closely documented. With municipal bonds failing to generate reliable payments, and Triple Five locked in a legal battle over taxes, the future of the Ghermezian family’s high-profile development remains uncertain. Whether the mall can stabilize its revenue streams and satisfy bondholders remains to be seen, but for now, investors are left grappling with yet another