CBL Properties, one of the largest shopping mall owners, files bankruptcy

CBL Properties announced Monday they have filed voluntary petitions for reorganization under Chapter 11 of the U.S. Bankruptcy Code in order to implement a plan to recapitalize the company, including restructuring portions of its debt. “Through this process, all day-to-day operations and business of the company’s wholly owned, joint venture and third-party managed shopping centers will continue as normal,” CBL officials said in a company press release. “CBL’s customers, tenants and partners can expect business as usual at all of CBL’s owned and managed properties.”

Headquartered in Chattanooga, Tenn., CBL Properties owns and manages a national portfolio of shopping malls. CBL’s portfolio is comprised of 107 properties across 26 states, including 65 high-quality enclosed, outlet and open-air retail centers and eight properties managed for third parties.

“After months of discussions and consideration of a number of alternatives, CBL’s management and the Board of Directors firmly believe that implementing the comprehensive restructuring through a Chapter 11 voluntary bankruptcy filing will provide CBL with the best plan to emerge as a stronger and more stable company,” said Stephen Lebovitz, chief executive officer of CBL. “With an aggregate of approximately $1.5 billion in unsecured debt and 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.”

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

The company has filed various customary motions with the court seeking several types of relief to allow CBL to meet necessary obligations and fulfill its duties during the restructuring process, including authority to continue payment of employee wages and benefits, honor certain customer and vendor commitments and otherwise manage its day-to-day operations as usual.

CBL stock closed Monday at $0.09 per share, down -40.4% for the day.