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Tuesday, February 16, 2010

Potential Consolidation of Mall Ownership in N.E.W.

The Press Gazette reports:
LOS ANGELES — Simon Property Group, the nation's largest shopping mall owner and owner of Bay Park Square mall in Ashwaubenon, has made a $10 billion hostile bid Tuesday to acquire ailing rival General Growth Properties.

The acquisition would allow General Growth, the No. 2 owner of shopping centers, to emerge from Chapter 11 bankruptcy protection. General Growth filed for bankruptcy last year after buckling under the weight of billions in debt it racked up during a massive expansion effort fueled by cheap credit.

General Growth owns the Fox River Mall in the town of Grand Chute.

The public radio program Marketplace had details on the possible merger on tonight's program:

BRETT NEELY: Simon and General Growth are like the Coke and Pepsi of the mall business. They own lots of high-end malls that skew towards Nordstrom rather than Sears. That's why Simon has wanted to buy General Growth since it declared bankruptcy last spring says Ivan Friedman, who runs RCS Real Estate Advisors.

IVAN FRIEDMAN: What this means is Simon is eliminating its largest competitor.

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