General Growth Properties Inc, the second largest owner of shopping malls in the United States including the South Street Seaport in Lower Manhattan, filed for bankruptcy protection today.
It was one of the biggest real estate bankruptcies in the country's history.
The Chicago-based company listed total assets of $29.56 billion and total debts of $27.29 billion and it sought Chapter 11 bankruptcy protection from creditors along with 158 of its more than 200 malls in the country while it tries to restructure its debt.
According to an article by Ilaina Jonas and Emily Chasan "the company said in a statement that it planned to continue exploring strategic alternatives during the bankruptcy protection, from which it is seeking to emerge as quickly as possible through a reorganization that preserves its national business."
"Analysts and other real estate experts," the article continued, "have speculated that mall owners Simon Property Group Inc and Westfield Group would be interested in buying some of General Growth's assets from bankruptcy. General Growth has been generating enough cash flow for the company to pay monthly interest costs and expenses, but it has been unable to refinance the principal of loans and mortgages as they come due because banks and other financing sources have been reluctant to issue large mortgages and loans."
The article quoted Adam Metz, the company's Chief Executive Officer as stating that its "core business remains sound and is performing well with stable cash flows," adding that "While we have worked tirelessly in the past several months to address our maturing debts, the collapse of the credit markets has made it impossible for us to refinance maturing debt outside of Chapter 11."
The company's stock price was $1.05 yesterday compared in a 12-month high of about $44 in May.
The company was founded by Martin and Matthew Bucksbaum in Cedar Rapids, Iowa, in 1954 and in 2004 it acquired Rouse Companies. Besides the South Street Seaport, where General Growth recently proposed a major redevelopment including a 40-story tower, shown in the accompanying rendering, Rouse owned Faneuil Hall Marketplace in Boston.
Thomas Nolan, the president of General Growth told Daniel Taub and Brian Louis of Bloomberg today that "we intend to emerge as a leaner company," adding "our business model remains strong."
It was one of the biggest real estate bankruptcies in the country's history.
The Chicago-based company listed total assets of $29.56 billion and total debts of $27.29 billion and it sought Chapter 11 bankruptcy protection from creditors along with 158 of its more than 200 malls in the country while it tries to restructure its debt.
According to an article by Ilaina Jonas and Emily Chasan "the company said in a statement that it planned to continue exploring strategic alternatives during the bankruptcy protection, from which it is seeking to emerge as quickly as possible through a reorganization that preserves its national business."
"Analysts and other real estate experts," the article continued, "have speculated that mall owners Simon Property Group Inc and Westfield Group would be interested in buying some of General Growth's assets from bankruptcy. General Growth has been generating enough cash flow for the company to pay monthly interest costs and expenses, but it has been unable to refinance the principal of loans and mortgages as they come due because banks and other financing sources have been reluctant to issue large mortgages and loans."
The article quoted Adam Metz, the company's Chief Executive Officer as stating that its "core business remains sound and is performing well with stable cash flows," adding that "While we have worked tirelessly in the past several months to address our maturing debts, the collapse of the credit markets has made it impossible for us to refinance maturing debt outside of Chapter 11."
The company's stock price was $1.05 yesterday compared in a 12-month high of about $44 in May.
The company was founded by Martin and Matthew Bucksbaum in Cedar Rapids, Iowa, in 1954 and in 2004 it acquired Rouse Companies. Besides the South Street Seaport, where General Growth recently proposed a major redevelopment including a 40-story tower, shown in the accompanying rendering, Rouse owned Faneuil Hall Marketplace in Boston.
Thomas Nolan, the president of General Growth told Daniel Taub and Brian Louis of Bloomberg today that "we intend to emerge as a leaner company," adding "our business model remains strong."
Architecture Critic
Carter Horsley
Since 1997, Carter B. Horsley has been the editorial director of CityRealty. He began his journalistic career at The New York Times in 1961 where he spent 26 years as a reporter specializing in real estate & architectural news. In 1987, he became the architecture critic and real estate editor of The New York Post.
6sqft delivers the latest on real estate, architecture, and design, straight from New York City.
