After $1.5B loss, Brookfield Property Partners buys back $426M of stock

Mall operator missed deadline to pay off $282M in CMBS debt secured by Virginia property

National /
Sep.September 03, 2020 03:35 PM
A photo illustration of Brookfield's Brian Kingston (Brookfield, iStock)

A photo illustration of Brookfield’s Brian Kingston (Brookfield, iStock)

Burdened with debt and non-paying tenants, one of the biggest mall operators in the country just poured $426 million into its own stock.

Brookfield Property Partners (BPY) bought back 35.5 million shares at a fixed price of $12 per share, according to documents filed with the SEC today. BPY’s share price has not been north of $12 since early June.

Brookfield funded the buyback by drawing from a $1 billion equity commitment from its parent company, Brookfield Asset Management. Half of the money came from cash on hand and the remainder from institutional investor accounts managed by Brookfield Asset Management.

Tenants at Brookfield’s retail properties only paid 34 percent of rent in the second quarter, and the company reported a net loss of $1.5 billion for the quarter. Earlier this week it was reported that Brookfield would miss the deadline to pay off $282 million in debt on the high-end Virginia’s Tysons Galleria mall in McClean, Virginia, after the commercial mortgage-backed securities loan was sent to a special servicer.

Repurchasing stock is a popular option for companies with extra cash but not inclined to spend it on growth. Buybacks reduce the number of shares outstanding on the market, thus increasing earnings per share and often the stock price as well — which can trigger executive bonuses.

Repurchases also represent a company’s investment in itself, and are a bet executives make when they perceive the firm’s stock is undervalued.


Related Articles

arrow_forward_ios
Winchester Lofts in New Haven, 1111 Stratford in Stratford and Brookfield's Bruce Flatt (Brookfield, Realtor, Getty)
Brookfield sells pair of Connecticut multifamily properties for $117M
Brookfield sells pair of Connecticut multifamily properties for $117M
Brookfield 's Brian Kingston with 3333 Broadway (Brookfield Asset Management, Street Easy)
Brookfield eyes $400M for massive Harlem rental
Brookfield eyes $400M for massive Harlem rental
From left: Cushman & Wakefield’s Doug Harmon and Adam Spies; American Express CEO Stephen Squeri; and 200 Vesey Street (Getty Images, Cushman & Wakefield, Brookfield Properties, Manhattan College)
American Express to explore headquarters sale, move
American Express to explore headquarters sale, move
Vanbarton Group's Richard Coles & 160 Water Street (Vanbarton Group, Collaborative Construction Management LLC, Getty)
Vanbarton lands $272M loan for Fidi office-to-resi conversion
Vanbarton lands $272M loan for Fidi office-to-resi conversion
Carlyle Group’s David Rubenstein and 193 Chauncey Street in Brooklyn and 530 Lafayette Avenue in Brooklyn (Google Maps, Carlyle, Getty)
Lenders favor resi projects in big month for outer-borough loans
Lenders favor resi projects in big month for outer-borough loans
Brookfield Property Partners CEO Brian Kingston and 660 Fifth Avenue (Brookfield Properties, Getty Images)
Major asset manager moves to 660 Fifth Avenue
Major asset manager moves to 660 Fifth Avenue
Skyline Tower in Hunters Point, Queens, and Downtown Brooklyn’s 11 Hoyt are the two largest condo developments in their boroughs. (Skyline Tower, 11 Hoyt, iStock)
TRD Pro: Ranking Brooklyn, Queens condo pipeline hotspots
TRD Pro: Ranking Brooklyn, Queens condo pipeline hotspots
(iStock)
The real estate stocks that won (and lost) the most during Covid
The real estate stocks that won (and lost) the most during Covid
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...