Nearly one year after a historic flood ravaged Nashville and submerged the popular Opry Mill shopping mall, the mall said it will reopen in 2012.
This will happen despite the fact the property owner, Simon Property, is still in court fighting with insurers over some $150 million to $200 million in insurance money it said it needed to rebuild.
Opry Mills said it has been able to reach an agreement with its lenders, Helaba Bank and Nord/LB, to finance the rebuilding of the mall.
Meanwhile, Opry Mills said it will continue its litigation against its insurers to get them to cover the flood losses.
Opry Mills was damaged by high flood waters in May 2010. Losses to the property are currently estimated to exceed $200 million.
Simon Property has received $50 million form insurers but it claims it is owed up to $200 million more for flood losses under excess insurance policies it purchased with the help of its broker, Aon Risk Services.
A group of some 16 insurers assumed varying percentages of the risk in excess layers of $50 million to $100 million and $100 million to $200 million. The list of insurers includes Sompo Japan, Zurich America, Lloyd’s of London, Ironshore, Lexington, Liberty Mutual and other well-known names.
Last September, Simon Property and Opry Mills, along with their lender Helaba, filed a lawsuit in the Chancery Court of Davidson County against the insurers and against insurance broker Aon.
The insurers have said Opry Mills is subject to only $50 million because that is the limit in the insurance package for properties located in 100-year high hazard flood zones.
But Simon insists that Opry Mills is not in a high hazard zone so the limitation does not apply. It claims that Aon issued numerous certificates of insurance confirming that the Opry Mills property was covered up to the $200 million limit. It also claims Aon affirmed this view in an email after the May flooding.
Opry Mills claims that insurers’ refusal to pay to the $200 million limits is contrary to the policy language and contrary to representations made by its broker, Aon. The mall owner is seeking the $200 million insurance payout plus triple damages under the Tennessee Consumer Protection Act.