Mall owner PREIT, owns and operates over 22 million square feet of retail space in the eastern half of the United States, has filed a voluntary Chapter 11 petition in the United States Bankruptcy Court for the District of Delaware to execute its prepackaged financial restructuring plan (Prepackaged Plan) under which the Company will be recapitalized and its debt maturities extended.
Last month, PREIT said it entered into the Restructuring Support Agreement with its bank lenders. The banks have committed to provide an additional $150 million to recapitalize the business and extend the Company’s debt maturity schedule, supporting PREIT’s operations and the continued execution of its strategic priorities.
PREIT said subsequent to executing the Restructuring Support Agreement, PREIT solicited acceptances of its Prepackaged Plan, which received overwhelming support from 95% of its creditors. ”The filing will ensure that PREIT can continue all business operations without interruption while it obtains necessary approvals of its financial restructuring plan.”
“We are pleased to be moving forward with strengthening the Company’s balance sheet and positioning it for long-term success through our prepackaged plan. We are grateful for the significant support we have received from a substantial majority of our lenders, which we expect will enable us to complete our financial restructuring on an expedited basis,” said Joseph F. Coradino, CEO of PREIT. “Today’s announcement has no impact on our operations – our employees, tenants, vendors and the communities we serve –and we remain committed to continuing to deliver top-tier experiences and improving our portfolio. With the overwhelming support of our lenders, we look forward to quickly emerging from this process as a financially stronger company with the resources and support to continue creating diverse, multi-use ecosystems throughout our portfolio.”
PREIT, a publicly traded real estate investment trust, headquartered in Philadelphia, Pennsylvania, said the financial restructuring is not expected to have any impact on the Company’s shareholders, and PREIT common and preferred shares are expected to continue to trade in the normal course.