Onyx Partners fails to close purchase of more than 115 properties by deadline
A planned $947 million sale of more than 115 JCPenney stores across the United States has collapsed after the buyer failed to close the transaction by a Dec. 26 deadline, setting off a legal battle between the parties.
Copper Property CTL Pass Through Trust said it terminated its agreement with Boston-based private equity firm Onyx Partners after the firm did not complete the purchase on time. In a federal regulatory filing, the trust said it had fulfilled all required conditions, while Onyx failed to meet its closing obligations.
Onyx has responded by filing a lawsuit seeking either completion of the deal or monetary damages, according to the filing, alleging that Copper Property breached the agreement. Copper Property said it plans to “aggressively contest” the claims and pursue counterclaims. Neither party provided additional comment.
The transaction was among the largest retail real estate deals pending in the U.S. market. The portfolio includes 117 JCPenney stores spread across 35 states and Puerto Rico, totaling roughly 15.5 million square feet of leasable space.
Prior to the termination, Onyx told CoStar via email that it remained prepared to close the transaction once Copper Property delivered outstanding tenant-related documentation, arguing that certain seller requirements had not yet been completed.
Copper Property disputes that claim, stating it satisfied all contractual obligations and is now reviewing “all legal rights” against Onyx and other involved parties.
Deposit and sale restart issues
Copper Property currently holds $2 million of Onyx’s $5 million earnest money deposit and is seeking the remaining $3 million from the escrow agent. Onyx is contesting that demand.
The trust has indicated it may distribute the $2 million it holds to shareholders on Jan. 9 as part of its regular monthly cash payment.
With the deal terminated, Copper Property must restart its asset sale process under tight timelines. The trust is required to liquidate remaining properties to repay creditors tied to JCPenney’s 2020 bankruptcy. The failed sale could also activate default provisions and complicate recovery efforts for creditors.
Copper Property said it expects to end its current marketing process and explore alternative strategies in early 2026. Those options could include selling the full portfolio, breaking it into smaller groups, selling individual properties, pursuing financing transactions or a mix of approaches.
When the portfolio was initially marketed through Newmark and Hilco Real Estate, Copper Property said it received more than 700 inquiries from potential buyers.
All of the properties remain subject to triple-net master leases with JCPenney, under which the retailer is responsible for insurance, property taxes and maintenance costs.
Source: Original reporting by Mark Heschmeyer, CoStar News.
