General Growth still needs $900 mil debt extension

Shopping center real estate investment trust General Growth Properties Inc. said Monday it is still negotiating for an extension on the maturity date on $900 million mortgage loans for two Las Vegas malls.

The news shook investors. The REIT's shares dropped 29 cents, or 16.4 percent, to $1.51 in morning trading Monday. The stock has lost 95 percent of its value over the past six months.

The REIT said it's still negotiating with the lenders for Fashion Show and Palazzo, both in Las Vegas. Earlier this month, Chicago-based General Growth received a two-week extension on the loans. It is also trying to sell its Las Vegas locations.

The country's second-largest mall owner is saddled with a huge debt it acquired during the real estate market's boom years when it aggressively bought up assets. Refinancing that debt has proved difficult amid a global credit crunch.

Last month, the company posted disappointing third-quarter results and cut its year-end forecast, weeks after it board ousted its chief executive, president and chief financial officer. The same month, the company also hired law firm Sidley Austin as an adviser.

General Growth has a stake in more than 200 shopping malls in 44 states.