Wednesday, December 02, 2009

GGP Gets Preliminary Approval of Bankruptcy Plan

According to this story by Erik Larsen, Edvard Pettersson, and Dan Levy in Bloomberg today, General Growth Properties received preliminary approval of its reorganization plan for 70 business units from U.S. Bankruptcy Judge Allan Gropper yesterday.

"The mall owner said units for which mortgage holders had agreed to new terms will exit bankruptcy by the end of the year. The deal didn’t include $6 billion in mortgages for other properties, which will stay in bankruptcy. "

This move may trigger bids from rival mall developers, Simon Property Group and The Westfield Group according to James Sullivan, a senior analyst with Green Street Advisors. “This sets the stage to make a pitch for the whole company,” Sullivan said.”

This relatively quick turnabout of the largest commercial real estate bankruptcy in the country bodes well for the both the company and the commercial real estate industry as a whole.