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General Growth Properties, Inc

General Growth Properties (GGP), the second-largest real estate investment trust and mall operator in the US, filed for bankruptcy in 2009 spearheading one of the biggest commercial real estate bankruptcies in U.S. history.

Founded in 1954 and expanded through a series of acquisitions the company has a huge retail presence throughout the US.  Recession dampened consumer spending and put many mall occupants out of business.   In September 30, 2008 GGP reported in excess of $25 billion in debt. A large portion of that debt came from GGP’s 2004 strategic acquisition of Rouse Co., a Columbia based real estate development and management company.  In late November 2008, GGP missed a deadline to repay $900 million in loans backed by two Las Vegas retail properties.  Its share price fell by 97%.  On April 16, 2009, GGP filed for Chapter 11 bankruptcy in federal bankruptcy court in Manhattan after it failed to strike a deal with its creditors.  Among the companies listed as General Growth’s 100 largest unsecured creditors were Eurohypo, a unit of Germany’s Commerzbank that represents holders of $2.6 billion worth of loans; Wilmington Trust and the Bank of New York Mellon, representing several classes of bonds; casinos including Mandalay Bay and the Venetian; and an assortment of retailers like Sephora, Guess, Borders and Macys.

The Chicago-based operator of more than 150 shopping malls in 43 states has now emerged from bankruptcy under protection from creditors after obtaining $6.8 billion in new equity capital and restructuring about $15 billion of debt. General Growth has started a smaller company called Howard Hughes Corp. that holds many of General Growth’s riskier assets, such as its residential-development division and a handful of malls, including New York’s South Street Seaport. The larger company owns 185 U.S. malls and continues to keep the General Growth name.

Inside General Growth Properties, Inc