Posted on 04/16/2009 7:04:39 AM PDT by EBH
NEW YORK (Reuters) – General Growth Properties Inc, the second largest U.S. mall owner, filed for bankruptcy protection on Thursday in one of the biggest real estate failures in U.S. history.
Ending months of speculation, the Chicago-based mall owner, which listed total assets of $29.56 billion and total debts of $27.29 billion, sought Chapter 11 bankruptcy protection from creditors along with 158 of its more than 200 U.S. malls, while it seeks to restructure some of its debt.
(Excerpt) Read more at news.yahoo.com ...
I hate to see our military men in personal difficulties, not matter what their rank.
LOL
GGP owns mid-sized enclosed shopping malls...which are going the way of the old drive-in movie theatres.
People prefer mega-malls, boutique malls, strip malls, and even internet shopping, instead.
Yup. Commercial real estate is about to experience the worst devaluation in history. Making the housing crisis seem like a small problem.
Very interesting (never heard of them). Thanks for posting. Good article.
Rouse brought the company 37 of the highest-quality and most valuable malls in the country, including Fashion Show in Las Vegas and Faneuil Hall Marketplace in Boston.
Since making loans to mall developers require extensive documentation, many banks and insurance companies do not sell the mortgage notes and hold onto them as company assets. Many of these notes are highly leveraged and the losses are equal to home mortgage losses. Failure of commercial real estate (malls, office buildings, hotels) will undo the solvency of these banks and insurance companies after the feds barely made them solvent over the losses in residential real estate collapse. Will the feds be able to sell more treasuries to cover these additional losses???? If not, the feds will be forced to print more dollars and trigger inflation. 2009 is going to be a hot year that determines the financial course of our country. My advice is go into survival mode. Organize your family, street and if possible your town for the chaos to come. Wash DC is too far away to help and all problems will be resolved locally. Tsunami is coming.
Yes, but those are just 37 malls out of over 200 that GGP owns. Or owned. The bankruptcy judge might shift ownership just a bit.
Well, let’s just say that US Bank ain’t happy about GGP going toes up.
and Major Malfunction and Captain Confusion (0 and Congress) are trying hard as ever to rescue Lieutenant Lumphead (ACORN and other Libtards) with our tax dollars. Trouble is, they have to sell our babies to borrow money for the bullets, beans, and blankets and then handout BS memos.
I totally agree. We are on a deadheading for devaluation of the US$. China is not going to buy any more debt unless they get at least a 4% yield. We need to let them fail and rebuild, it will be tough. But the alternative is catastrophic.
True, but shifting ownership so the new owners have an additional meny drain from their assets? Who wants a wet firecracker?
Oregon's fund managers (politican overseers) have apologized so I guess it's OK.
You mean like this:
What's Dead? (Short Answer: All Of It)
"Civil unrest will break out before the end of the year. The Military and Guard will be called up to try to stop it. They won't be able to. Big cities are at risk of becoming a free-fire death zone. If you live in one, figure out how you can get out and live somewhere else if you detect signs that yours is starting to go "feral" - witness New Orleans after Katrina for how fast, and how bad, it can get."
"The bad news is that you won't have a job, pension, annuity, Social Security, Medicare, Medicaid and, quite possibly, your life.
[snip]
A 'Copper Standard' For The World's Currency System?
Hard money enthusiasts have long watched for signs that China is switching its foreign reserves from US Treasury bonds into gold bullion. They may have been eyeing the wrong metal."
[snip]
Major Corporation isn’t doing so well either.
My wife and I have noticed that what was called an abomination by elitist Californians, the strip malls seem to be doing okay with local shops, spas and whatever.
The bigger closed in Malls and those spread over acres of land seen to have been in trouble for years. Stores that closed 2-3 years ago, haven’t been replace by new stores, and the spaces they rented are still vacant. Yet Strip malls a mile or so down the road seem to be doing good.
The more scary part is many well known insurance companies have financed mall development. They never anticipated a collapse in retail sales to threaten malls. To get a commercial loan, it is very documented, with pre leases of major stores, an in depth study on foot traffic, financial health of the anchor retailers and mall developers, business model and etc before the lender will approve a loan to the developer. Since commercial loans are considered less riskier than residential loans, many banks and more important insurance companies keep the mortgage note to enjoy the interest it gets. For insurance companies it is one of the mainstays in their portfoilios to generate lucrative profits to backup life insurance and annuities. Maasive failure in commercial real estate mortgages WILL IMPACT life insurance and annuities. If these policies go bankrupt, many states are suppose to insure the policy holders. It varies state to state the amounts that is covered, but ALL the states do not have suffient funds to cover a massive failure. Majority of commercial real estate loans (5 year balloons) are due this summer 2009. Majority of them are already behind payments and are having a hard time refinancing due to high vacancy rates in their properties.
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