“I think that was a sign that we are making progress,” company spokesman Jim Graham said of General Growth’s stock, which rose 2.3%, to $14.01.
The mall giant, which owns or operates 200 regional shopping centers, had amassed $27 billion in debt when it entered bankruptcy proceedings, but has since restructured $10.65 billion.
While the company’s debt reorganization has not affected its local properties, its emergence from bankruptcy proceedings will likely come along with the financial strength of a third-party investor that could lead to facility improvements and better tenant recruitment at the sites, experts said.
“Right now they’re focusing on getting their house in order, and so someone in that situation isn’t looking at upgrading their facilities or bringing in new tenants,” said Stuart Waldman, president and chief executive of the Valley Industry & Commerce Assn. “They’re looking at surviving.”
If the company can secure a deal that could give it the resources to lure new tenants into vacancies and make upgrades that draw more shoppers, the sites could be an important part of the region’s recovery, Waldman said.
“The malls are a key economic indicator,” he said. “The more people you see at the malls shopping, the better the economy is doing, so I’m hopeful that they start doing really well really soon.”
The company reported that net operating income at its retail sites dropped 4.4% in 2009, and that it cut its overhead costs by $48 million during that period, results that it deemed strong considering the current economic conditions and bankruptcy proceedings.
