Bankruptcy of second largest mall chain "signals wave of distress"

[mgcardin]

There's already a thread about the bankruptcy itself, but not about this recent (published today) Washington Post story, which has a great headline and some quality analysis, so I thought I'd start a separate thread so that it doesn't get buried.

But given the new quoting rules due to copyright freakouts, I'm not sure how to handle this one. So here's my ad hoc attempt:

AREA MALL OWNER'S CRISIS SIGNALS WAVE OF DISTRESS
The Washington Post, April 17, 2009

Main points:

• General Growth Properties, which owns more than 200 malls in 44 states, sought bankruptcy protection yesterday for debts of $27 billion.
  
• The bankruptcy "heralds a wave of trouble in commercial real estate that threatens to put another damper on the economy."
• The company president said they're going to make the bankruptcy "invisible" to customers by continuing with business as usual in the stores.
• Their stock shares closed at $1.05 yesterday. Compare this to their 52-week high of $44.23.
• $1.2 trillion in commercial real estate debt will come due by the end of 2011, and many borrowers won't be able to pay up or refinance.
• The CEO of J.P. Morgan Chase told analysts yesterday that the banking system will begin to experience mounting losses from commercial real estate.

[Pegasus]

There's already a thread about the bankruptcy itself, but not about this recent (published today) Washington Post story, which has a great headline and some quality analysis, so I thought I'd start a separate thread so that it doesn't get buried.

But given the new quoting rules due to copyright freakouts, I'm not sure how to handle this one. So here's my ad hoc attempt:

AREA MALL OWNER'S CRISIS SIGNALS WAVE OF DISTRESS
The Washington Post, April 17, 2009

Main points:

• General Growth Properties, which owns more than 200 malls in 44 states, sought bankruptcy protection yesterday for debts of $27 billion.
  
• The bankruptcy "heralds a wave of trouble in commercial real estate that threatens to put another damper on the economy."
• The company president said they're going to make the bankruptcy "invisible" to customers by continuing with business as usual in the stores.
• Their stock shares closed at $1.05 yesterday. Compare this to their 52-week high of $44.23.
• $1.2 trillion in commercial real estate debt will come due by the end of 2011, and many borrowers won't be able to pay up or refinance.
• The CEO of J.P. Morgan Chase told analysts yesterday that the banking system will begin to experience mounting losses from commercial real estate.

If Gerald Celente is right the next big collapse is happening right along these lines.  The commercial real estate collapse, sort of like a newly unemployed person, creates a snowball effect.  Nobody is going to rent out these vacant buildings and up the chain it goes.

[mobil1]

The company president said they're going to make the bankruptcy "invisible" to customers by continuing with business as usual in the stores.

What a crock ! I've heard this one too many times before.

AT&T bought the troubled company I worked for (for the lucrative gov't contracts) and told the media nobody would lose their job. AT&T held interviews and only kept a fraction of people. I contacted the reporter and they were not interested in this fact.

Conquest vacations goes bankrupt and a rep tells the media vacationers will not be inconvenienced. Meanwhile the people in the hotels on the bankruptcy day are being forced to cough up more cash.

INVISIBLE ! Not likely ! Doesn't it just make sense that the security and cleanup crews are going to be cut to the bone ? Will Santa be there this year ? At least he added a qualifier by saying "...in the stores" and not "...in the malls."

I just hate these blatant lies/deceptions that the media all too often just report verbatim without question. All part of the script when a company goes under.

[Ty Fjoyd]

• $1.2 trillion in commercial real estate debt will come due by the end of 2011, and many borrowers won't be able to pay up or refinance.

[/list]

How does $1.2T compare to the residential (subprime, etc.) real estate total?