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WILLOW GROVE, PA-Pennsylvania Real Estate Investment Trust completed the previously announced refinancing of Willow Grove Park with a $160-million first mortgage. The Philadelphia-based retail REIT will use a portion of the proceeds to repay the previous mortgage on the property, repay a portion of the amount outstanding on its credit facility and for general corporate purposes.

The new loan has an interest rate of 5.65% and matures in December 2015. The previous mortgage had a balance of $107.5 million and an interest rate of 8.39%. Lenders of the new loan are Prudential Insurance Co. and Teachers Insurance and Annuity Association.

Under the terms and certain conditions, PREIT can convert the loan to a senior unsecured loan. “Converting it to a corporate loan, rather than a mortgage on the property, would leave more income tied to properties that are unencumbered,” Andrew Ioannou, PREIT’s VP of capital markets, tells GlobeSt.com. “This is beneficial if we were to try to pursue an investment-grade rating, because rating companies look at income from properties that are unencumbered.”

Willow Grove, at 2500 Mooreland Ave., has current anchors Bloomingdale’s, Macy’s, Strawbridge’s and Sears. Regarding recent retailer mergers, “there is no conflict between the Bloomingdale’s and Macy’s units, and they will stay intact,” Cheryl Dougherty, VP of marketing, tells GlobeSt.com. “Strawbridge’s will convert to something new, and we’re waiting to hear,” she says. “We’re very excited about it; it enables us to bring something new to the space. Coach, J. Crew and Banana Republic–stores people really want to shop in,” are among the newer tenants in the center, Dougherty says. The center was totally renovated in 2001 and is currently 92% occupied.

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