The South Street Seaport could be under new management if General Growth Properties’ bankruptcy exit plan with Brookfield Asset Management comes to fruition. General Growth, which has announced an agreement to reorganize with the help of $6.55 billion from Brookfield, Pershing Square Capital Management and Fairholme Capital Management, plus an additional $1.5 billion debt issuance, would split in two under the plan. The deal amounts to $15 a share, and is subject to bankruptcy court approval. Shareholders would also get 34 percent ownership in the reorganized General Growth Properties, which would focus on shopping malls, and 86 percent equity in its new spin off, General Growth Opportunities, which would own real estate properties like the South Street Seaport, the company said. The company is still exploring other deal options as it has until July 15 to finalize the terms of its reorganization, said Adam Metz, General Growth’s CEO. Those include a $10 million proposal from competitor Simon Property Group, which has been soundly rejected, though Simon is reportedly prepping another, higher offer. [Bloomberg]

As Simon Property Group prepares to step up its game in its bid to takeover bankrupt mall owner General Growth Properties, Brookfield Asset Management is in talks to bring two new hedge funds into its competing plan. Elliott Associates and Paulson & Co. are reportedly in talks to join Brookfield in its bankruptcy exit plan for General Growth, either as replacements for or additions to Fairholme Capital Management and Pershing Square Capital Management, which have already committed to their involvement. Luxor Capital Group and other funds may also be involved, sources told Bloomberg. “Even with Brookfield-Fairholme-Pershing’s commitment, [General Growth] management has been seeking to raise additional capital at more attractive terms,” said analyst Benjamin Yang of Keefe Bruyette & Woods, who was not surprised by reports of the latest negotiations. General Growth, which owns the South Street Seaport, rejected a $10 million buyout offer by competitor Simon Property Group last month that amounted to $9 per share, and Simon is said to be prepping another offer. As it stands, the Brookfield deal, which is pending bankruptcy court approval, would result in $15 per share for equity holders. [Bloomberg]

Simon Property Group is reportedly ready to up the ante in its bid to buy out rival shopping mall owner General Growth Properties over its competitors. General Growth, which owns the South Street Seaport, filed for the biggest real estate bankruptcy in U.S. history last year with $27 billion in debt. Simon had offered
$10 billion, or $9 per share, to buy out its bankrupt rival last month, but General Growth reportedly balked at what it said was a low-ball offer. Meanwhile, General Growth has praised another $2.5 billion offer from Brookfield Asset Management
that amounts to $15 per share. The deal, which is pending bankruptcy court approval, would also split the company in two and give Brookfield a 30 percent stake. Simon’s new offer for more than $15 per share could come as early as this week, the Associated Press reported. [AP via Crain’s]

Bankrupt mall owner General Growth Properties is weighing its options amid what’s turning out to be a heated battle over the company’s future. After rejecting outright an buyout offer from Simon Property Group, General Growth is now pushing for a deal in principle with Brookfield Asset Management that would split the company in two. There may still be more offers yet to come: General Growth President and COO Thomas Nolan testified in bankruptcy court this week that “four or five” non-disclosure agreements have been signed by potential bidders who want to look at the company’s numbers. In the video above, the Wall Street Journal chats with Nolan about the offers and what’s next for General Growth.

General Growth Properties, one of the largest mall property managers in the country and owner of the South Street Seaport retail area, is planning to launch an initial public offering on the New York Stock Exchange Friday, according to the Associated Press. GGP had filed for bankruptcy protection last April — the largest real estate bankruptcy case ever recorded in the U.S. — and has recently been the target of investment and buyout offers from other companies. Simon Property Group offered to buy the company outright in February for $10 billion, but was turned down. Canadian group Brookfield Asset Management, however, saw its $2.5 billion investment offer last week accepted, a move that allowed GGP to exit Chapter 11 protection.

Seth Pinsky and Coney Island

As New York City development has struggled through the downturn, the city and the New York City Economic Development Corporation have had to contend with negative public sentiment, Seth Pinsky, president of the city-controlled non-profit promoting economic growth, said. “Because you don’t see physical activity on the ground, people assume [that some projects] are stalled, [that] they’re not happening,” Pinsky told a packed crowd at a Bisnow panel discussion on public and private development partnerships today. “There are two misconceptions,” about the city’s development initiatives, Pinsky added: “one is that we haven’t had success with big projects and two, that we’ve only been focused on big projects.” Although the project has been stymied along the way, Pinsky said that Coney Island’s rebirth ranks as one of the Bloomberg administration’s greatest accomplishments. [more]

General Growth Properties is receiving a $2.5 billion shot in the arm from Canadian property manager Brookfield Asset Management that will allow the shopping mall giant to exit Chapter 11 bankruptcy protection, the company announced today. Brookfield will invest the funds in exchange for a 30 percent stake in General Growth, the second largest mall owner in the country, whose portfolio includes the South Street Seaport. General Growth, which filed for the biggest real estate bankruptcy in U.S. history last year with $27 billion in debt, said shareholders would receive $15 per share in the deal, which is pending bankruptcy court approval. The company also plans to raise up to $5.8 billion in cash to repay its creditors and to create a new company for some of its existing assets. Last week, Indianapolis-based competitor Simon Property Group  offered to buy out General Growth for $10 billion, or $9 per share, including $9 billion in cash. General Growth dismissed the offer as low-ball. [AP via Crain's]

Shopping mall giant Simon Property Group has offered to buy out bankrupt General Growth Properties for more than $10 billion, or $9 per share, the Indianapolis-based company announced this morning. Its offer, which includes roughly $9 billion in cash, would provide for a full cash recovery plus interest and dividends for Chicago-based General Growth’s unsecured creditors, amounting to $7 billion. Shareholders would emerge with more than $9 per share, $6 of which would be in cash, Simon Property said. General Growth, the second-largest shopping mall owner in the country next to Simon Property, filed for the biggest real estate bankruptcy in U.S. history last year with $27 billion in debt, $11.8 million of which had already matured or was coming due by the end of 2012. The South Street Seaport operator filed a $9.7 billion reorganization plan in December and some had speculated that it could exit bankruptcy this year. “Simon’s offer provides the best possible outcome for all General Growth stakeholders,” David Simon, company chairman and CEO, said in a statement. “Our offer provides much-needed certainty to conclude General Growth’s protracted reorganization process.” TRD

From the December issue: Until last year, The Real Deal‘s annual accounting of real
estate records was a Mad Libs of giddy peaks: The highest price ever
paid for [insert type of real estate] in [insert name of borough] was
catalogued, time and again.
Even in 2008 — before Lehman Brothers fell and the recession
tightened its stranglehold on the city — records were toppled. On the
residential side, Manhattan logged the highest median sale price ever,
$945,276, while on the commercial side, Boston Properties paid $2.9
billion for the GM Building, the highest price ever shelled out in the
United States for an office tower. But many of 2009′s records are record lows, rather than record
highs. For example, the second quarter of the year saw the largest
year-over-year drop — 25.6 percent — ever recorded by appraisal firm
Miller Samuel in Manhattan’s median sale price for apartments. The firm
has been releasing market reports for the last decade. [more]

Retail real estate could be on its way back, with recovery expected to begin in 2010, according to the latest data from Real Capital Analytics. Additionally, the overall shopping environment could be favoring smaller retail real estate firms, a trend that some industry experts predict may continue. While larger retail landlords, like U.S. shopping mall owner General Growth Properties, have suffered in the recession, smaller property owners are able to more quickly adjust to changing economic conditions, according to Adam Ginsburg, co-chairman of GDC Properties, a shopping center owner operating out of Hawthorne, N.Y. “Because of our size, decisions work themselves to the top of the company fairly quickly,” Ginsburg said. “We have a very flat organization and can pull the trigger faster than those that have to go through management layers such as investment committees.” September saw the first monthly gain in same store sales across the country — albeit a .1 percent gain — the first jump in more than a year. With shopping activity possibly stabilizing, the 2009 holiday season could be crucial for retail real estate, according to Retail Traffic magazine. Al Williams, principal with Excess Space Retail Services, a real estate lease restructuring firm, said that if the holiday shopping season doesn’t go smoothly, the U.S. could see between 6,000 and 8,000 store closings in the first two quarters of 2010. [Retail Traffic Mag] and