» » General Growth Properties, Jones Lang LaSalle Ink Deal For 18 US Malls : WSJ

General Growth Properties, Jones Lang LaSalle Ink Deal For 18 US Malls : WSJ

(RTTNews) – Troubled mall owner General Growth Properties Inc. (GGP, GGWPQ.PK) entered into an agreement with Jones Lang Lasalle Inc. (JLL) to take over its third-party management business that operates 18 U.S. malls not owned by General Growth, the Wall street Journal or WSJ reported Monday. The financial aspects of the deal, which closed on Friday, were not disclosed.

The properties in question include Burbank Town Center in Burbank, California; Festival Bay Mall in Orlando; and the Shops at Georgetown Park in Washington, D.C., among others and are owned by institutional investors, the Journal reported.

As part of the deal, Jones Lang LaSalle will take over management of the malls spanning 11 million square feet in 12 states, as well as 230 employees that work in the General Growth division. According to the WSJ, the duo would share profits from the management contracts based on the properties’ performance in the forthcoming months and years.

The Chicago-based real estate services company, Jones Lang LaSalle manages more than 300 malls and shopping centers spanning 84 million square feet.

The WSJ said that General Growth’s President and Chief Operating Officer Tom Nolan expects the strategic alliance with Jones Lang LaSalle to allow its clients to leverage the resources and talents from both GGP and Jones Lang LaSalle and to create a broader range of services for its clients, thereby strengthening their bottom line.

General Growth is the second-largest mall operator in the U.S. with more than 200 regional shopping malls in 44 states.

The company sought Chapter 11 bankruptcy protection in April 2009 after failing to refinance portions of its $27 billion debt as they came due, filing the biggest real-estate bankruptcy in the U.S. history. However, certain subsidiaries, including GGP’s third party management business conducted by General Growth Management, Inc. and GGP’s joint ventures were not filed for protection.

Most recently, General Growth Properties announced that it expects to file Chapter 11 Plan of Reorganization and accompanying disclosure statement on or around July 9, and filed motion with Bankruptcy Court for extension of exclusive period.

Friday, JLL closed at $67.71, and GGP finished at $13.75, on the NYSE.

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