General Growth Misses Deadline

AP

General Growth shares fall after missed deadlineTuesday December 16, 9:51 am ET

General Growth shares fall after missing debt repayment deadline, ratings downgrade
WASHINGTON (AP) -- Shares of troubled shopping mall owner General Growth Properties Inc. dropped Tuesday after the company missed a crucial deadline to repay $900 million in debt and saw its debt ratings downgraded further into junk status.
Its stock shed 15 cents, or 8.2 percent, to $1.70 in morning trading.
Credit rating agency Moody's Investors Service on Monday downgraded the debt ratings for Chicago-based General Growth, which said earlier in the day it is still negotiating for an extension on the maturity date mortgage loans for two Las Vegas malls.
After General Growth's announcement, Moody's pushed the debt ratings for General Growth and its subsidiaries further into junk bond status. Both senior secured and senior unsecured debt were downgraded to Ca, two notches above default from Caa2. Moody's said the ratings "remain on review for possible downgrade."
Earlier this month, Chicago-based General Growth received a two-week extension on the loans for two Las Vegas properties, but has yet to receive another extension.
Moody's said the failure to repay the debt "will most likely lead to an imminent acceleration" of debt payments on bonds issued by The Rouse Company, a shopping center owner acquired by General Growth in 2004.
The country's second-largest mall owner is saddled with a huge debt it acquired during the real estate market's boom years when it aggressively bought up assets. Refinancing that debt has proven difficult amid a global credit crunch.
General Growth has a stake in more than 200 shopping malls in 44 states