General Growth Properties may seek bankruptcy protection
San Antonio Business Journal
General Growth Properties Inc., the owner of two major shopping centers in San Antonio, says it might be forced to seek bankruptcy protection from its creditors as it struggles to refinance debt. The company’s stock tumbled as much as 70 percent in Tuesday trading.
The Chicago-based company has a significant presence in San Antonio. The company owns North Star Mall and is the co-owner of The Shops at La Cantera. North Star counts more than 200 stores as tenants. The Shops at La Cantera recently completed an expansion in October that brought in an additional 300,000 square feet of space.
General Growth has $958 million in debt that comes due Dec. 1 and another $3 billion in debt that matures in 2009. Citing weakness in the credit and retail markets, the company says it can’t be sure it will be able to refinance or extend terms on the debt.
“Our potential inability to address our 2008 and 2009 debt maturities in a satisfactory fashion raises substantial doubts as to our ability to continue as an ongoing concern,” General Growth Properties said in a Securities and Exchange Commission filing. “We may be required to take further steps to acquire the funds necessary to satisfy our short-term cash needs, including seeking legal protection from our creditors.”
General Growth Properties acquired Columbia. Md.-based Rouse Co. in 2004 for $7.2 billion and assumed $5.4 billion in Rouse debt as part of the deal.
Last week, General Growth Properties reported a quarterly loss of $15.4 million, suspended its shareholder dividend and said it would halt plans for any new construction or development.
General Growth shares (NYSE: GGP) opened Wednesday at 43 cents per share, but was trading in the 35-cent range in mid-afternoon trading. The company’s stock once traded at a 52-week high of $51.24 per share.
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