MEDIA RELEASE

General Growth Properties, Inc. has announced it is voluntarily seeking relief to reduce and restructure its debts under Chapter 11 of the U.S. Bankruptcy Code in the court of the Southern District of New York. 

In addition, approximately 158 regional shopping centers owned by GGP and certain other GGP subsidiaries have also filed for protection. This includes including Ala Moana and Ward centers on Oahu and Prince Kuhio Plaza in Hilo.

Along with owning and managing the three Hawaii malls, GGP manages  Kings’ Shops at Waikoloa Beach Resort and Queens’ Marketplace on the Big Island; Windward Mall and Kapolei Commons on Oahu; and Whaler’s Village and Queen Kaahumanu Center on Maui.

The company intends to work with its constituencies to emerge from bankruptcy as quickly as possible while executing on a plan of reorganization that preserves the company’s integrated, national business operations.

Certain subsidiaries, including GGP’s third party management business and GGP’s joint ventures, have not filed for protection. A complete list of subsidiaries that have filed voluntary petitions can be found on the company Web site.

All day-to-day operations and business of all of the company’s shopping centers and other properties will continue as usual.

The decision to pursue reorganization under Chapter 11 came after extensive efforts to refinance or extend maturing debt outside of Chapter 11. 

Over many months, the company has endeavored to negotiate with its unsecured and secured creditors to obtain the time needed to develop a long-term solution to the credit crisis facing the company. Unable to reach an out-of-court consensus, the company reluctantly concluded that restructuring under the protection of the bankruptcy court was necessary. 

During the Chapter 11 cases, the company will continue to explore strategic alternatives and search the markets for available sources of capital. 

The company intends to pursue a plan of reorganization that extends mortgage maturities and reduces its corporate debt and overall leverage. This will establish a sustainable, long-term capital structure for the company.

The company also announced it has received a commitment for a debtor-in-possession financing facility of approximately $375 million from Pershing Square Capital Management, L.P., as agent. 

When approved by the bankruptcy court, the new facility will provide a source of funds to the company during the Chapter 11 process. The company has requested, and expects to receive, additional approvals to give the company the authority to make payments to ensure that the company’s shopping centers and other properties continue to operate uninterrupted in the ordinary course of business, including paying employee compensation, certain critical service providers, insurance and other claims. The company intends to pay all providers of goods and services delivered post-petition.

“Our core business remains sound and is performing well with stable cash flows. We believe that Chapter 11 is the best process for restructuring maturing mortgage loans, reducing the company’s corporate debt, and establishing a sustainable, long-term capital structure for the company,” CEO Adam Metz said. “While we have worked tirelessly in the past several months to address our maturing debts, the collapse of the credit markets has made it impossible for us to refinance maturing debt outside of Chapter 11.”

The company currently has ownership interest in, or management responsibility for, more than 200 regional shopping malls in 44 states, as well as ownership in master planned community developments and commercial office buildings. 

The company’s portfolio totals approximately 200 million square feet of retail space and includes more than 24,000 retail stores nationwide. The company is listed on the New York Stock Exchange under the symbol GGP.

— Find out more:

General Growth Properties: www.ggp.com