Mall Owners CBL & Associates, PREIT File for Chapter 11 Bankruptcy Protection

by Katie Lee

Chattanooga, Tenn. and Philadelphia — Against headwinds brought on by the COVID-19 pandemic, CBL & Associates Properties Inc. and Pennsylvania Real Estate Investment Trust (PREIT) filed for Chapter 11 bankruptcy protection on Nov. 1.


Philadelphia-based PREIT owns and operates 22.5 million square feet of retail space including 19 mall properties in New Jersey, Pennsylvania, Massachusetts, Maryland, Virginia, Michigan, North Carolina and South Carolina.

The company has reached a Restructuring Support Agreement (RSA) with its bank lenders, under which an additional $150 million will be committed to recapitalize the business and extend its debt maturities.

“[The] 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,” says Joseph Coradino, CEO of PREIT. “With the overwhelming support of our lenders, we look forward to quickly emerging from this process as a financially stronger company.”

DLA Piper LLP and Wachtell, Lipton, Rosen & Katz are serving as legal counsel and PJT Partners LP is serving as financial advisor to PREIT in the bankruptcy proceedings.

CBL & Associates

Chattanooga-based CBL & Associates owns and manages a portfolio of 107 properties totaling 66.7 million square feet across 26 states, including 65 enclosed, outlet and open-air retail centers and eight properties managed for third parties.

The company entered into an RSA in August with a group of bondholders in hopes of restructuring its balance sheet. In its bankruptcy filing, CBL listed its estimated assets and liabilities in the range of $1 billion to $10 billion, according to reports by CNBC.

“With an aggregate of approximately $1.5 billion in unsecured debt, preferred obligations eliminated and a significant increase to net cash flow, upon emergence, CBL will be in a better position to execute on our strategies and move forward as a stable and profitable business,” says the company’s CEO, Stephen Lebovitz.

As of Sept. 30, CBL had approximately $258.3 million in unrestricted cash on hand and available-for-sale securities. This cash position, combined with the positive cash flow generated by ongoing operations, is expected to meet the company’s operational and restructuring needs.

Weil, Gotshal & Manges LLP is serving as legal counsel and Moelis & Co. is serving as restructuring advisor to CBL & Associates during the bankruptcy proceedings.


— Katie Sloan


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