Friday, 17 April 2009

WRAPUP 3-General Growth files largest US real estate bankruptcy

Fri Apr 17, 2009 12:15am BST

* Company has $27.3 bln debt versus $29.6 bln assets

* Obtains $375 mln in DIP financing from Pershing Square

* Pershing's Ackman joining General Growth board

* Stock falls to about 60 cents, suspended by NYSE (Adds approval for cash, Ackman comments, retailer comment, NYSE suspension)

By Ilaina Jonas and Emily Chasan

NEW YORK, April 16 (Reuters) - General Growth Properties Inc GGP.N, the second-largest U.S. mall owner, declared bankruptcy on Thursday in the biggest real estate failure in U.S. history.

Ending months of speculation, General Growth, along with 158 of its 200-plus U.S. malls, filed Chapter 11 while it tries to refinance its debts.

But the ongoing global financial crisis made it impossible for General Growth to restructure outside of bankruptcy and could signal further troubles for other financial institutions who are General Growth creditors.

The collapse underscores the pressure on U.S. commercial real estate with few sources of available funding.  Continued...