GGP says it will continue with downtown plan for Columbia
Company announces it will put a number of other projects on hold
By Derek Simmonsen
dsimmonsen@patuxent.com
Posted 11/06/08
General Growth Properties’ proposal to redevelop downtown Columbia is not among a list of projects the company plans to put on hold, a company spokesman said today.
In its third-quarter earnings report released yesterday, company officials said they had “deferred the development, construction or opening” of projects that were not near completion or already approved as part of joint-ventures.
The statement was meant to apply only to projects that were already under way or planned for the months immediately ahead, said company spokesman James Graham in an e-mailed statement.
“The important thing is that we work together with the Columbia community and Howard County so that we can have a good plan in place today making us ready when the economy turns favorably around in the future,” Graham said.
Chicago-based General Growth, the second-largest owner of U.S. shopping malls, owns the Columbia mall and six other shopping centers in Maryland. It also owns and develops planned communities and is the majority landowner in downtown Columbia, where it recently announced a 30-year redevelopment plan.
That plan is under review by the county, which is expecting to release a technical review of it in the near future.
Once approved, each phase of the plan would occur “as market conditions allow,” Graham said. Some of the construction work could begin within six months to a year of the county’s approval, but the timing of any work would depend on the market, he said.
Stock in General Growth fell yesterday as the company released its latest earnings, which showed a drop in the third quarter.
General Growth’s funds from operations, a measure typically used to gauge the performance of real estate investment trusts, dropped by $23 million over the same time period last year, according to a company news release. The 11 percent drop was attributed to lower net operating income from its planned communities.
The company, a real estate investment trust that is traded on the New York Stock Exchange, started the day at $4, but was trading in the $2 range by midday. It has traded at $51 within the past year, but fallen sharply after General Growth released a statement Sept. 22 saying it was evaluating “financial and strategic” alternatives in order to raise capital and improve its stock price.
The company has sold $47 million worth of non-core assets this year and is continuing to hunt for a buyer for some of its Las Vegas properties: the Fashion Show Mall, Grand Canal Shoppes at the Venetian and The Shoppes at The Palazzo, a hotel and casino resort.
Interim CEO Adam Metz told investors and analysts he expected to announce more deals by the end of the year, Bloomberg News has reported.
General Growth has been able to refinance, delay or repay all of its debt due through yesterday. However, the company has $900 million of property debt and $58 million of corporate debt due by Dec. 1 and it is working to refinance or extend those loans, the release states.
CEO John Bucksbaum, whose family founded the company, and President Robert Michaels resigned from their jobs Oct. 26, although they remain at the company as chairman of the board and chief operating officer, respectively.
The company announced a stock options package Monday that will allow Metz to gain 1 million shares of company stock and interim president Thomas Nolan to gain 800,000 shares, based on the closing price Monday.
In its third-quarter earnings report released yesterday, company officials said they had “deferred the development, construction or opening” of projects that were not near completion or already approved as part of joint-ventures.
The statement was meant to apply only to projects that were already under way or planned for the months immediately ahead, said company spokesman James Graham in an e-mailed statement.
“The important thing is that we work together with the Columbia community and Howard County so that we can have a good plan in place today making us ready when the economy turns favorably around in the future,” Graham said.
Chicago-based General Growth, the second-largest owner of U.S. shopping malls, owns the Columbia mall and six other shopping centers in Maryland. It also owns and develops planned communities and is the majority landowner in downtown Columbia, where it recently announced a 30-year redevelopment plan.
That plan is under review by the county, which is expecting to release a technical review of it in the near future.
Once approved, each phase of the plan would occur “as market conditions allow,” Graham said. Some of the construction work could begin within six months to a year of the county’s approval, but the timing of any work would depend on the market, he said.
Stock in General Growth fell yesterday as the company released its latest earnings, which showed a drop in the third quarter.
General Growth’s funds from operations, a measure typically used to gauge the performance of real estate investment trusts, dropped by $23 million over the same time period last year, according to a company news release. The 11 percent drop was attributed to lower net operating income from its planned communities.
The company, a real estate investment trust that is traded on the New York Stock Exchange, started the day at $4, but was trading in the $2 range by midday. It has traded at $51 within the past year, but fallen sharply after General Growth released a statement Sept. 22 saying it was evaluating “financial and strategic” alternatives in order to raise capital and improve its stock price.
The company has sold $47 million worth of non-core assets this year and is continuing to hunt for a buyer for some of its Las Vegas properties: the Fashion Show Mall, Grand Canal Shoppes at the Venetian and The Shoppes at The Palazzo, a hotel and casino resort.
Interim CEO Adam Metz told investors and analysts he expected to announce more deals by the end of the year, Bloomberg News has reported.
General Growth has been able to refinance, delay or repay all of its debt due through yesterday. However, the company has $900 million of property debt and $58 million of corporate debt due by Dec. 1 and it is working to refinance or extend those loans, the release states.
CEO John Bucksbaum, whose family founded the company, and President Robert Michaels resigned from their jobs Oct. 26, although they remain at the company as chairman of the board and chief operating officer, respectively.
The company announced a stock options package Monday that will allow Metz to gain 1 million shares of company stock and interim president Thomas Nolan to gain 800,000 shares, based on the closing price Monday.
user comments (1)
user exinsider says...
Prediction: GGP will likely declare bankruptcy by the end of November.
Posted 10:58 AM, 11.11.08
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