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Shopping Mall Giant Goes Bankrupt

Second-largest U.S. mall owner can't refinance billions in debt

By Clay Dillow, Newser Staff

Posted Apr 16, 2009 7:08 AM CDT

(Newser) – Chicago-based General Growth Properties, the second-largest US shopping mall owner, filed for Chapter 11 bankruptcy today after attempts to refinance more than $27 billion in debt failed, Bloomberg reports. The owner of more than 200 shopping malls owes a unit of Germany’s Commerzbank $2.6 billion, while bondholders are on the hook for $4 billion. Much of the debt stems from the purchase of developer Rouse Co. in 2004.

General Growth lost 81% of its market value in just 6 months as credit markets collapsed and refinancing debt became impossible. In November, Standard and Poor’s de-listed the company from the S&P 500 index after shares, which had been as high as $67 in March 2007, plunged and market value sunk to $128 million, lowest on the list. Shares closed at $1.05 yesterday.

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Shoppers stroll around the Westfield Century City Shopping Center Thursday, Nov. 8, 2007, in Los Angeles. (AP Photo/Ric Francis)

A woman shops in a mall March 27, 2009 in Stamford, Connecticut. (Getty Images)

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The collapse of the credit markets has made it impossible for us to refinance maturing debt outside of Chapter 11.
- Adam Metz, CEO, General Growth Properties

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Shopping Mall Giant Goes Bankrupt