The Downtown Downturn

Given the state of the economy and the real estate markets in particular, we're beginning to wonder if all this discussion about plans for downtown seem, well, what's the word, remote.

A lot of dust has to settle before we'll ever see a shovel in the ground. Just ask the folks who were planning to build a highrise in town center. They filed for bankruptcy protection.

Now check out this release from the prime corporate mover behind a new downtown -- General Growth:

CHICAGO – September 22, 2008 – General Growth Properties, Inc. (NYSE: GGP) today announced that the Company’s Board of Directors and management team is pursuing a comprehensive evaluation of its alternatives, both financial and strategic, in an effort to align the market value of the Company’s common stock more closely with the intrinsic value of the Company’s stable, high quality portfolio of real estate assets in good locations with significant barriers to entry. Occupancy reached a record high of 93.2% in the second quarter of 2008 and comparable net operating income continued to increase, even in a challenging consumer sales environment.

The Company currently anticipates that it will be in a position to offer a long-term fixed-rate portfolio mortgage financing to lenders in mid to late November, and in the interim will actively pursue several sources of financing for the Company’s near term maturing obligations. The Company and its advisors are also developing a comprehensive, strategic plan to generate capital from a variety of potential sources including, but not limited to, both core and non-core asset sales, the sale of joint venture or preferred equity in selected pools of its assets, a corporate level capital infusion, and/or strategic business combinations.

General Growth is one of the largest U.S.-based publicly traded Real Estate Investment Trusts (REIT) based upon market capitalization. The Company currently has ownership interest in, or management responsibility for, a portfolio of more than 200 regional shopping malls in 44 states, as well as ownership in master planned community developments and commercial office buildings. The Company's portfolio totals approximately 200 million square feet and includes over 24,000 retail stores nationwide. The Company is listed on the New York Stock Exchange under the symbol GGP.

The Sun/Flier's ExploreHoward blog tried to assess what this means for General Growth's operations in Columbia:

Greg Hamm, regional vice president and general manager of Columbia for General Growth, said he could not definitively rule out the company selling its property in downtown Columbia in the future, but said there are no immediate plans to do so.

“I think it doesn’t change any of our plans or what we intend to submit to the county,” he said...

...Columbia is unique among General Growth’s properties in that it has a main retail space, the Columbia mall, surrounded by other property owned by the company that can be developed. Those factors make it less likely it would be sold, Hamm said.

“Columbia is not only a great existing retail property for us, but it’s a unique and significant future development opportunity because of the land we own around it,” he said.

The blog goes on to report that the Securities and Exchange Commission added General Growth to its list of companies protected against short sales, a type of stock purchase in which the buyer profits from a drop in stock price.

Here's a prediction: It won't be long before someone says downtown Columbia must be redeveloped to save General Growth, to save HoCoLand and our tax base.