interesting take on major holder
taken from a north carolina commercial real estate web site
General Growth Still In Question…
By binx007
On Friday General Growth filed yet another SEC filing stating that they have not achieved financing and their forebearance period on their loans has ended. But, will the banks choose to default the lons an send them into bankruptcy? Or do they want to keep GGP out of bankruptcy.
The longer the banks keep General Growth Properties out of bankruptcy, the better control they have over the loans. If GGP is ofrced to file bankruptcy the banks will loose control over the loans and a judge will have all the control.
Is now a good time to invest in GGP?
I wouldn’t say yes or no, but there are a few big investors who believe GGP’s book value of $6.76 per share will hold through bankruptcy and could possibly be worth more to the shareholders.
What if GGP does liquidate? What if GGP does file bankruptcy?
Book Value per share is estimated around $6.76
But that’s based on asset values when they were purchased. Some might be lower… properties purchased in the last 5 years could definately be lower. But GGP has held properties for much longer than 5 years. the value of their longer holdings would more than offset the current value of recent purchases.
So how high could the book value be? 8… 9… 10… 20 per share?
GGP is trading at $0.50.
If GGO goes BK you could make a lot… A LOT of money.
So who are the big investors?
DSC Advisors made a new purchase of GGP Stock on 2/19/2009 of 32,157,000 shares.
So who is DSC Advisors?
Best known contact would be Neil Bluhm of Walton Street Capital.
Walton Street Capital’s office is at 900 N. Michigan Ave in Chicago.
DSC Advisors office is at 900 N. Michigan Ave in Chicago.
GGP’s office is less than 2 miles from Walton Street Capital and DSC Advisors.
Walton Street Capital:
Walton Street invests and manages with the philosophy that real estate is a commodity subject to cycles, both in terms of its underlying supply and demand fundamentals and its pricing relative to other financial assets. Through the Principals’ relationships, experience and discipline, Walton Street has consistently demonstrated its ability to identify opportunities to create and maximize value, while minimizing risk, through: opportunistic investing, which correctly identifies capital voids, market and operating inefficiencies and anticipated cyclical recoveries; value-added asset management, which aggressively seeks to redevelop or reposition under-managed and under-capitalized assets to appeal to a broader, institutional marketplace; and a disciplined disposition strategy, which identifies an exit strategy before an investment is made and is continuously evaluated to seek an optimal and efficient result.
Walton Street believes it is critical that those making the investment and management decisions invest significant personal capital alongside investors. Underscoring this philosophy, of the $3.5 billion of total equity commitments, the Principals of Walton Street have personally invested $202 million.
The importance of a disciplined disposition strategy dictates Walton Street’s investment focus on well-located institutional quality assets within desirable markets, which are likely to have greater liquidity by appealing to a wider range of potential buyers. On a portfolio basis, Walton Street utilizes only moderate levels of leverage through the use of predominantly first mortgage, non-recourse debt, which is structured to give Walton Street the greatest flexibility so as not to impede an asset’s timely exit. Typically, Walton Street makes investments that seek to meet our return objectives over an expected average holding period of three to five years.
WAS THAT NEW HOLDING ON FEBRUARY 19, 2009 SIGNIFICANT?
That’s your call… I say if it wasn’t I don’t know too many people less than two miles from GGP that would invest $15 Million Dollars into their stock… especially not a real estate holding company… unless they had some very, very, critical information.
Here’s another one… Guggheim Capital invested in a little over 100,000 shares on Febraury 17th.
That’s not a lot, but the significance is there.
Guggenheim is once again located where?
227 West Monroe Street.
Where’s that?
Less than 4 blocks from General Growths corporate office.
Is another 50K invested last week from Chicago significant? Who knows, but the reality is these guys aren’t just fund holders they are real estate investors, blocks away from GGP’s headquaters in Chicago and are dumping money in GGP. They only have to walk 5 minutes down the road to get the inside scoop. And to think one real estate tycoon doesn’t know somthing about another… 5 minutes away… is a bit naive.
Bill Ackman certainly thinks it is worth some money. His fund Pershing Square controls approximately 20-25% of GGP stock. But Bill has bet several tims on bankruptcy… and he has been right several times. Why buy a Bankrupt stock?
Property Values… if the company is liquidated the stock should be worth much more than it is worth now.
