General Growth Properties Price Target Taken Down By Credit Suisse (GGP)

Credit Suisse reduced its price target on General Growth Properties, Inc

yesterday to $16.00 from $16.50 on concerns of a lower value for its Spinco, the aptly named Howard Hughes Corp. It still has a Neutral rating. In a note to clients, Credit Suisse writes, "We are reducing our Spinco estimated value to $3.50 per share from $4.00 to reflect further deterioration in the housing market"... "The driving point for our price target reduction is the continued weakening of the housing markets in Las Vegas and Texas. we have reduced our land valuation for Spinco by approximately 19% to reflect the current conditions. We believe the market has gotten ahead of itself and is attributing too much value to the mall business of GGP while overlooking the weakening residential business." Credit Suisse goes on to say, "We estimate New GGP trades at an implied cap rate of 6.5%, a stone's throw from 6.2% for Simon

. In addition, GGP trades at 19.5x our 2011 AFFO estimate, a 9% premium to Simon. We would happily take Simon as the other side of the GGP trade for such a small spread at current valuations given Simon's outlet business, balance sheet and management." Shares of General Growth Properties, Inc

closed up 6 cents today to $16.99, higher than Credit Suisse's price target.