If Atlantic City hasn’t taken enough hits, the Pier Shops at Caesars is up for sale, but reportedly at a steep discount.
The 290,210-square-foot retail strip that boasts high-end retailers such as Gucci, Louis Vuitton, Burberry, Michael Kors as tenants and famous restaurants such as Buddakan and Continental as dining spots has seen sales slip as patronage to Atlantic City casinos has been on the decline.
The mini mall at 1 Atlantic Ocean Ave. is attached via skybridge to Caesars Atlantic City Hotel and has direct access off the boardwalk. It was constructed in 2004 but then redeveloped in 2006 by Taubman Centers Inc. on a 900-foot long pier and, at the time, built under the theory that high-end casinos have a captured audience of high-end shoppers who will use the same impulse of gambling to splurge on a Louis Vuitton bag. It was then appraised at $187.5 million but has seen that dwindle to single digits, according to some reports.
By 2010, Taubman relinquished the property and remains in the hands of a special servicer overseeing a $135 million mortgage on the property. In August 2012, the investors who ended up buying the commercial mortgaged back securities loan on the property decided to put the property up for auction. It got a $25.1 million bid that the special servicer declined to accept, according to published reports.
An $80.5 million loan remains outstanding on the property, according to Trepp, a research firm that tracks CMBS loans. The property had been appraised at $11 million but then cut by about half that amount, according to most Trepp data. The center is already roughly 52 percent leased.
Copyright bizjournal
