PHILADELPHIA — Pennsylvania Real Estate Investment Trust (PREIT) has filed for Chapter 11 bankruptcy as of Sunday, Nov. 1. PREIT (NYSE: PEI), which is based in Philadelphia, owns and operates 22.5 million square feet of retail space including 19 mall properties in New Jersey, Pennsylvania, Massachusetts, Maryland, Virginia, Michigan, North Carolina and South Carolina.
PREIT has reached a Restructuring Support Agreement (RSA) with its bank lenders, under which an additional $150 million will be committed to recapitalize the business and extend its debt maturities. The announcement coincides with the Chapter 11 filing of Tennessee-based CBL & Associates (NYSE: CBL), which owns and manages a portfolio of 107 properties totaling 66.7 million square feet across 26 states, including 65 enclosed, outlet and open-air retail centers and eight properties managed for third parties.
“Today’s announcement has no impact on our operations — our employees, tenants, vendors and the communities we serve — and we remain committed to continuing to deliver top-tier experiences and improving our portfolio,” says Joseph Coradino, CEO of PREIT. “With the overwhelming support of our lenders, we look forward to quickly emerging from this process as a financially stronger company.”
DLA Piper LLP and Wachtell, Lipton, Rosen & Katz are serving as legal counsel, and PJT Partners LP is serving as financial advisor to PREIT in the bankruptcy proceedings. PREIT’s stock (NYSE: PEI) closed at $0.50 on Friday, Oct. 30, down from $5.66 on the same date last year.