Fitch cuts General Growth to RD

Fitch Ratings said it said that Rouse Co. LP bondholders are likely to see term reductions due to the nonpayment of principal at maturity on two series of notes maturing in the coming months and the agency has maintained the rating watch negative status on Rouse's C issuer default rating and downgraded the issuer default rating and outstanding debt ratings of General Growth Properties to RD from C.

Fitch said it has also removed General Growth from rating watch negative, noting that an RD rating denotes restricted default status.

According to the agency, the rating downgrade follows General Growth Properties' entry into multiple forbearance agreements upon a payment default with its syndicates of lenders for its revolving credit facility and term loan entered into in 2006 and its secured mortgage loan facility entered into in 2008.

Fitch said it has maintained Rouse's C issuer default rating on rating watch negative based on General Growth's announcement yesterday that Rouse launched a consent solicitation to holders of Rouse's unsecured notes to forbear from exercising remedies with respect to various payment and other defaults under the unsecured notes through Dec. 31, 2009.

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