$3.99 -0.16 (-3.86%)
11/6/2009 3:59 PM

General Growth Properties (GGWPQ.PK)

CAPS Rating: 2 out of 5

A self-administered and self-managed real estate investment trust whose business is focused in two main areas: Master Planned Communities and Retail and Other.

Current Price $3.99 Mkt Cap $1.3B
Open $4.03 P/E Ratio 2.12
Prev. Close $4.15 Div. (Yield) 2.00 (9.30%)
Daily Range $3.86 - $4.12 Volume 1,803,262
52-Wk Range $0.24 - $5.48 Avg. Daily Vol. 2,020,000
OTC Market Tier:

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Caps

How do you think GGWPQ.PK will perform vs the S&P 500?

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All Members

253 Outperform
151 Underperform
 

All-Star Members

85 Outperform
67 Underperform
 

Wall Street

4 Outperform
2 Underperform
 

Top GGWPQ.PK Bull/Bear Pitches

The best Bull and Bear pitches based on recency and number of recommendations.

BravoBevo (100.00)
Submitted October 21, 2009

General Growth Properties Inc. (GGWPQ.PK) resides under bankruptcy protection. To grasp its potential, it’s beneficial to look into its history as to how it ended up in its current bankruptcy status. Brothers Martin and Matthew Bucksbaum started with… More

DarthMaul09 (97.81)
Submitted October 06, 2009

They have made a significant gain from the March lows and appear on the surface to be improving their business. Their margin of error still remains small, with either a W recovery and/or a sudden sustained interest rate increase triggering a return… More

GGWPQ.PK VS S&P 500 (SPY)

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Recent Community Commentary

Read the most recent pitches from members about GGWPQ.PK.

Recs

0
Member Avatar spundun (68.07) Submitted: 11/4/2009 4:57:36 PM : Outperform Start Price: $4.20 GGWPQ.PK Score: -6.39

HT BB, AllStarPortfolio

Recs

0
Member Avatar jdcarcollector (20.74) Submitted: 10/30/2009 11:46:14 AM : Underperform Start Price: $4.28 GGWPQ.PK Score: +8.79

equity will likely need to be diluted, wiped out.

Recs

7
Member Avatar BravoBevo (100.00) Submitted: 10/21/2009 7:03:49 PM : Outperform Start Price: $1.50 GGWPQ.PK Score: +143.95

General Growth Properties Inc. (GGWPQ.PK) resides under bankruptcy protection. To grasp its potential, it’s beneficial to look into its history as to how it ended up in its current bankruptcy status. Brothers Martin and Matthew Bucksbaum started with a Marshalltown Iowa family grocery store, and borrowed $1,200,000 in 1954 (when a dollar was worth something) to build a shopping center in Cedar Rapids, Iowa. From that model, the brothers built shopping centers throughout the Midwest, went public in 1993, moved its headquarters from Des Moines to Chicago, and began an acquisition spree of upscale shopping malls, including the purchase of Rouse Co, the owner of 30 malls that included Chicago’s Water Tower Place. In the last decade, the company had grown to become the nation's second-largest shopping mall company, with more than 200 centers, but with those properties the company was saddled with $27 billion of debt. Each property is held in a special purpose subsidiary and is financed in large part by debt financing that is collateralized by a mortgage on the property. Lenders often will take a pool of mortgaged backed loans, bundle them together into commercial mortgage backed securities (CMBS), and sell those securities into the markets.

As credit markets began drying up in 2007 and real estate properties have been losing their value, the company filed for bankruptcy in April 2009 to obtain protection from its creditors. U.S. Department of Treasury rules governing the CMBS market historically have prohibited the restructuring of CMBS loans unless the borrower is in payment default of its loan. So a “performing” loan that has an out-of-date interest rate or repayment schedule could not be modified until the loan would become “nonperforming.” In a first round of relief to the CMBS market, the Treasury has released new tax rules to allow modifications of loans even if the collateral is currently generating cash that meets a loans minimum payment requirements. Details are available in this WSJ article: http://online.wsj.com/article/SB125306317643414339.html

The company lobbied for these new rules and, now that they are implemented, it is in prime position to take advantage of them by restructuring the loans on its many properties. Modifying the CMBS loans will allow the company to take advantage of lower interest rates and to extend the loan maturities over the extended life of the properties. As these changes are negotiated and applied to the portfolio of properties, I expect several positive results: (1) nonperforming loans and loans that are barely performing will become fully performing, thus taking a special purpose subsidiary owning the now-performing property off of creditwatch; (2) with lower rates and extended maturities, less of the properties current cash flow will be needed to service current maturities of long-term debt, thereby freeing up cash to make needed improvements on the properties and to distribute cash to the parent company; (3) the thawing of the old rules will bring the commercial property credit markets to resume lending, which should ease the gridlock over real property transactions currently experienced in almost all major markets; and (4) the culmination, as least from the viewpoint of the company, will be its emergence from bankruptcy protection. Through October 2009, the bankruptcy judge ruling on the parallel bankruptcies of GGWPQ and its many special purpose subsidiaries has consistently rejected various motions and requests put forth by secured creditors who are attempting to unwind the bankruptcies of the subsidiaries.

Now that is quite a bit of work to be tackled before the sun is fully shining on the commercial real estate market again. And it may take several years before all of the effects are realized, but the seeds are there. GGWPQ might not ever reclaim its glory days of trading above $70 per share, but in my opinion, the potential problems, risks of bankruptcy, and assumptions of a full-blown economic downturn all seem to be fully baked into the existing stock price.

My original pitch was shared here: http://caps.fool.com/Pitch/GGWPQ.PK/4263464/on-september-16-2009-at-214-am.aspx Due to limitations on that account the position there was closed out. Now I am substantially repeating the original pitch to keep it up for sharing and discussion.

Leaderboard

Find the members with the highest scoring picks in GGWPQ.PK.

Score Leader

mmmed

mmmed (30.82) Score: +279.76

Famous CAPS quote: "Make sure you don't make underperform picks because you can only get 100 points off of one of those."

Top
Pick
Member Name Member
Rating
Start
Date
Call Time
Frame
Start
Price
Stock
Gain
S&P
Gain
Score Commentary
BravoBevo 100.00 7/13/2009 Outperform 5Y $1.50 +166.00% +22.05% +143.95 4 Comments
txrock < 20 1/6/2009 Outperform 3Y $1.54 +159.09% +15.99% +143.10 1 Comment
steve3333 30.88 1/12/2009 Outperform NS $1.51 +164.24% +24.96% +139.28
Krowe365 39.84 12/22/2008 Outperform 3W $1.56 +155.77% +23.08% +132.69
GainingKnowledge 97.82 1/13/2009 Outperform 1Y $1.55 +157.59% +25.15% +132.43
intheknow2009 < 20 1/7/2009 Outperform 3M $1.59 +150.94% +18.63% +132.32 1 Comment
Zenvesting 98.34 12/9/2008 Outperform 5Y $1.58 +152.53% +21.63% +130.90
dew250 93.85 12/10/2008 Outperform 3Y $1.59 +150.94% +21.66% +129.28 1 Comment
InvestJoey < 20 12/5/2008 Outperform 3Y $1.54 +159.09% +31.50% +127.59
max03 91.59 7/13/2009 Outperform 5Y $1.61 +147.83% +20.47% +127.36

Wall Street

See what the Wall Street professionals think, according to their public statements and filings.

Member Name Member
Rating
Start
Date
Call Time
Frame
Start
Price
Stock
Gain
S&P
Gain
Score End Date Commentary
TrackBillAckman < 20 12/8/2008 Outperform 1Y $1.80 +66.67% +16.85% +49.81 8/24/2009 @ $3.00 3 Comments
TrackWachovia 35.10 10/3/2008 Outperform NS $10.46 -90.06% -27.72% -62.34 4/7/2009 @ $1.04
TrackUBS 86.41 8/1/2008 Outperform NS $26.79 -91.64% -24.65% -66.99 11/6/2008 @ $2.24
TrackCitigroup 21.22 7/31/2008 Underperform NS $25.94 -84.62% -13.23% +71.39
TrackChrisDavis < 20 6/3/2008 Outperform 1Y $39.67 -89.94% -20.25% -69.70 1 Comment
TrackSoros 65.62 3/31/2008 Outperform NS $37.01 -89.22% -14.91% -74.31 1 Comment
TrackDeutscheSec 89.50 2/13/2008 Outperform NS $35.63 -88.80% -18.20% -70.60
TrackZacks 69.52 12/5/2007 Outperform 3M $45.35 -47.21% -14.27% -32.94 8/20/2008 @ $23.94 1 Comment
TrackFBRCapitalM 75.98 4/11/2007 Outperform NS $59.39 -93.28% -21.80% -71.49
TrackCitigroup 21.22 3/12/2007 Outperform NS $62.81 -35.44% +4.58% -40.02 1/2/2008 @ $40.55
TrackAGEdwards 89.12 12/1/2006 Outperform NS $55.00 +19.27% +2.95% +16.33 2/8/2007 @ $65.60
TrackRBCCapMkts 81.74 11/7/2006 Underperform NS $44.03 -90.94% -17.73% +73.21

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