A Delaware Superior Court judge has issued a ruling in a complex dispute over a $26.2 million loan for the Brandywine Town Center.
The Town Center is off Route 202 on the northern edge of Delaware.
Judge Eric M. Davis ruled that the defendant Arcadia, in part, violated provisions of the loan agreement related to conveying to the mortgage holder, information on easements, covenants running with the land and insurance proceeds. Two Arcadia entities are named in the case.
Arcadia is based in New York state.
Davis also ruled that Arcadia did not violate provisions regarding insolvency provisions. Also exempt from any action is a Red Robin restaurant, which is on the Brandywine Town Center property.
“The Court further believes that the Brandywine Complaint and the Acadia Complaint each only assert one cause of action. The parties are to contact the court for an additional hearing regarding the status, if any, of outstanding issues,” Davis wrote.
Suits were filed by 5190 Brandywine Parkway, LLC. Parkway was assigned collection work on the mortgage for Bear Stearns Commercial Mortgage, which made the loan to Arcadia.
According to the decision, the loan in question matured on July 1, 2016, with an Arcadia entity failing to pay the principal, accrued interest, default interest, and late fees.
Arcadia has other mortgages for the Brandywine Center. This includes tracts where it has a partial interest. The area also has a popular strip center that includes a Trader Joe’s.
Parkway has filed multiple suits in Superior and Chancery courts . (See copy of Superior Court decision.
The case was assigned to the Complex Litigation Division of New Castle County Superior Court. As the name indicates, the division handles complex cases in intellectual property, real estate and other areas that’s don’t go to Chancery Court.
Arcadia acquired Brandywine Town Center from the Rollins family, which won a battle in the 1990s with neighborhood civic organizations over developing the former harness racing property.
The New Castle County Council approved the plan for the property, which despite a name suggesting mixed uses, ended up as an effort to build a regional shopping center.
The regional mall never materialized as fashion department stores stayed put in existing malls such as Concord. Sought-after stores like Nordstrom did not come. Years later Nordstrom opened a store in Christiana Mall.
Much of the interior space at Brandywine Town Center ended up being used for offices. The town center did attract big box stores with exterior entrances, such as Lowe’s, Target and Regal Cinemas.
More recently large tracts like the Town Center have become mixed-use centers that can include offices, retail, service businesses, restaurants, condominiums, and apartments.
As the Brandywine Town Centers heads towards its fourth decade, civic groups and transportation planners are pondering possible redevelopment.
Civic groups are also concerned about the future of nearby Concord Mall, which last week learned it will lose its Sears store, leaving it with Macy’s and Boscov’s as anchors. The mortgage to Concord Mall was snapped up by a real estate company that specializes in older malls with rising vacancy rates and buying mortgages to those properties at a discount.