Washington Prime Group Inc. WPG, a real estate investment trust focused on enclosed malls and strip center retail properties, has filed for Chapter 11 bankruptcy.
What Happened: The Columbus, Ohio-based company announced its filing in the U.S. Bankruptcy Court for the Southern District of Texas on Sunday.
In a press statement, the company said it agreed to enter Chapter 11 “after executing a restructuring support agreement with creditors, led by SVPGlobal, that hold approximately 73% of the principal amount outstanding of the Company’s secured corporate debt and 67% of the principal amount outstanding of the company’s unsecured notes.”
Washington Prime Group stated it “secured $100 million in new money debtor-in-possession financing from the consenting creditors to support day-to-day operations during the Chapter 11 process,” adding that its business operations will not be disrupted.
Why It Happened: In announcing its bankruptcy filing, the company blamed the tumult created by the COVID-19 pandemic for creating “significant challenges.” Enclosed shopping malls were particularly hard hit during the pandemic, with many properties closed for months and retail tenants either going out of business or having difficulty making rent payments.
Washington Prime Group has assets estimated at $4 billion and a debt of almost $3.5 billion. It deferred on a $23.2 million bond interest payment in February and entered into forbearance agreements with several lenders in March. In its Q1 earnings report, the company acknowledged a net loss of $55.4 million, compared to net income of $3.4 million one year earlier.
CEO Lou Conforti said the bankruptcy filing will enable the company to “right size its balance sheet and position the company for success going forward.”
At last check, the company’s stock was trading down 43% at $2.84, far from its 52-week high of $16.55 and closer to its 52-week low of $1.69.
(Illustration by Markus Winkler / Pixabay.)
© 2022 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Ad Disclosure: The rate information is obtained by Bankrate from the listed institutions. Bankrate cannot guaranty the accuracy or availability of any rates shown above. Institutions may have different rates on their own websites than those posted on Bankrate.com. The listings that appear on this page are from companies from which this website receives compensation, which may impact how, where, and in what order products appear. This table does not include all companies or all available products.
All rates are subject to change without notice and may vary depending on location. These quotes are from banks, thrifts, and credit unions, some of whom have paid for a link to their own Web site where you can find additional information. Those with a paid link are our Advertisers. Those without a paid link are listings we obtain to improve the consumer shopping experience and are not Advertisers. To receive the Bankrate.com rate from an Advertiser, please identify yourself as a Bankrate customer. Bank and thrift deposits are insured by the Federal Deposit Insurance Corp. Credit union deposits are insured by the National Credit Union Administration.
Consumer Satisfaction: Bankrate attempts to verify the accuracy and availability of its Advertisers' terms through its quality assurance process and requires Advertisers to agree to our Terms and Conditions and to adhere to our Quality Control Program. If you believe that you have received an inaccurate quote or are otherwise not satisfied with the services provided to you by the institution you choose, please click here.
Rate collection and criteria: Click here for more information on rate collection and criteria.