General Growth still looking to improve liquidity through asset sales

By Jennifer Lanning Drey

Portland, Ore., Nov. 5 - General Growth Properties, Inc. continues to look for ways to generate cash, primarily through the sale of core and non-core assets, and hopes to announce some transactions before the end of the year, Adam Metz, interim chief executive officer of General Growth, said Wednesday during the company's third-quarter earnings conference call.

"I realize we have been saying this for a long time and we have yet to announce any transactions of significance. We do realize that we need to generate billions of dollars to de-leverage the company," Metz said.

General Growth was current on all of its debt obligations as of Wednesday and was in compliance with its debt covenants at the end of the third quarter, interim president Thomas H. Nolan Jr. said.

However, the company has $900 million of property secured debt and about $58 million of corporate debt scheduled to mature by Dec. 1 that remains to be refinanced or extended.

General Growth will also look to negotiate loan extensions where possible and continues to explore possibilities for corporate-level capital infusions and broader strategic business combinations, he said. The company has also deferred development spending.

"We understand the situation that we're in. We're all working very hard to get some transactions done to fix the balance sheet and put us in a better position going forward," Metz said.

During the call, Nolan said the company's prior announcement that it plans to sell its Las Vegas Strip assets was a tough choice but has generated interest and the company is working with its advisers to move the process forward.

"Obviously, we'd prefer to sell non-core over core, but we have a significant amount of loan maturities in the next year, and we're going to have to make some tough choices," Metz said.

"I don't think we'll necessarily have one monster transaction that's going to solve all of the company's leverage issues, but it's a road that we're marching down and hopefully we'll make progress each month as we go along."

General Growth is a Chicago-based real estate investment trust.

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