The company that manages the Kingsport Town Center, General Growth Properties, filed for bankruptcy early Thursday morning in one of the biggest commercial real estate collapses in United States history.
According to a New York Times report the bankruptcy came despite bargaining for months with its creditors. General Growth faced increasing pressure to handle its more than $25 billion in debt, largely in the form of short-term mortgages that will come due by next year. The company has been severely wounded by the recession, which has wreaked havoc upon the retailers who inhabit its more than 200 malls in 44 states. Many stores have shuttered, depriving mall operators like General Growth of revenue.
The filing by the Chicago-based company, made in federal bankruptcy court in Manhattan, included most of the company’s malls, which will continue to operate. General Growth’s reorganization efforts will likely focus on selling off properties. It has already suspended its stock dividend, cut its workforce by 20 percent and stopped virtually all new development. (Read the filing after the jump.)
“Our core business remains sound and is performing well with stable cash flows,” Adam Metz, General Growth’s chief executive, said in a statement. “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.”
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