General Growth Properties Inc., operator of malls in Manchester and Waterbury, will begin asking bondholders to hold off requesting payment as the shopping center owner attempts to refinance billions in debt and avoid bankruptcy, according to a media report today.
The Chicago-based real estate investment trust will start a consent solicitation asking holders of $2.3 billion of its bonds to not demand payment of principal and interest on the debt for the rest of this year, The Wall Street Journal said today, citing a person familiar with the matter. Interest on the bonds would still accrue.
General Growth owns The Shoppes At Buckland Hills in Manchester and Brass Mill Center in Waterbury.
The company is having trouble refinancing billions in debt it took on during an aggressive expansion effort that included the $7 billion purchase of a competitor in 2004. It has been trying to get its lenders to rework its debt terms and warned last fall it might have to seek bankruptcy protection.
General Growth said it’s considering all strategic alternatives and continuing discussions with its lenders.
The REIT currently has about $1.18 billion of past due debt and about $4.09 billion worth of debt that could be called in. It also has an additional $1.44 billion worth of consolidated mortgage debt and about $595 million of unsecured bonds scheduled to mature during 2009 that remains to be refinanced, repaid or extended.
 At 11:55 a.m., General Growth traded at 39 cents, up 6 cents, or 18.2 percent. (AP)
