HAMPTON ROADS, Va. - The parent companies of two local malls announced Monday that they have filed for bankruptcy.
CBL Properties, which is based in Chattanooga, Tennessee, announced that CBL & Associates Properties, Inc., CBL & Associates Limited Partnership and certain other related entities have filed voluntary petitions for reorganization under Chapter 11 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the Southern District of Texas in Houston. This was done in order to implement a plan to recapitalize the company, including restructuring portions of its debt.
Through this process, CBL Properties said 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’s customers, tenants and partners can expect business as usual at all of CBL’s owned and managed properties, which includes Greenbrier Mall in Chesapeake.
Additionally, PREIT, which owns Patrick Henry Mall in Newport News, also announced it has filed a voluntary Chapter 11 petition in the U.S. Bankruptcy Court for the District of Delaware. PREIT is based in Philadelphia.
PREIT announced on October 14 that it entered into the RSA with its bank lenders, which have committed to provide an additional $150 million to recapitalize the business and extend the company's debt maturity schedule.
PREIT said it will pay all vendors, suppliers and employees during the course of the filing and added that the prepetition claims of suppliers and other trade creditors and business partners will not be affected.
According to the United States Courts, a Chapter 11 bankruptcy "generally provides for reorganization, usually involving a corporation or partnership. A Chapter 11 debtor usually proposes a plan of reorganization to keep its business alive and pay creditors over time. People in business or individuals can also seek relief in Chapter 11." It is often referred to as a "reorganization bankruptcy."