By  on December 18, 2008

General Growth Properties Inc. secured a temporary reprieve from its lenders Thursday, pushing back an overdue $900 million mortgage payment to February. But the cash-deprived company is now looking for buyers for New York’s South Street Seaport and other mixed-use properties in Boston and Baltimore.

The financial breathing room pushed up General Growth’s shares to as much as $2 Thursday, but the stock closed with a 1.9 percent, or 3 cent, gain at $1.61. Shares of the firm have traded as high as $44.23 over the last year.

General Growth signed the forbearance and wavier agreement with its syndicate of lenders late Wednesday, extending the deadline for its mortgage payments to Feb. 12 after days of negotiations. The debt came due on Dec. 12 and is tied to the Fashion Show and Palazzo properties in Las Vegas, which the company put on the block in October. General Growth also entered into a deal extending its 2006 senior credit agreement until Jan. 30.

The Chicago-based developer took on huge debt to build its portfolio of more than 200 malls but couldn’t keep up with payments as the economy weakened and credit conditions tightened.

Bankruptcy was a possibility had the lenders not agreed to the extension.

“We need to generate billions to deleverage the company,” Adam Metz, interim chief executive officer, said on a conference call with analysts last month. “Sales transactions are an important part of our plan. Unfortunately, these transactions take time and, until the deals are completed, there is really nothing to announce. We hope to be able to report some transactions prior to yearend.”

Affiliates of the firm retained DTZ Rockwood LLC to sell its owner’s interest in Festival Marketplace Portfolio, according to the property adviser’s Web site Thursday. The company declined to comment.

A spokesman for General Growth said, “South Street Seaport, Faneuil Hall [in Boston] and Harborplace [in Baltimore] are among a group of properties for which General Growth is seeking partners, investors or buyers.”

The three developments encompass a total of 1.2 million square feet, including office space, with retail sales per square foot of $593.

The South Street Seaport is in a historic area of lower Manhattan that had its commercial heyday in the 1850s. The existing mixed-use project was developed in the 1980s. It is owned by the city and General Growth is the leaseholder. The Seaport houses units from Victoria’s Secret, Coach, Abercrombie & Fitch, Gap, J. Crew and Guess, as well as As Seen On TV and Brookstone, among others.

Last week, General Growth managed to get about $896 million in mortgage loans, which it planned to use to retire a $58 million bond that came due, and about $814 million in mortgages maturing next year. The maturities on the new financing range from five to seven years.

In all, the company has more than $3 billion in debt maturing next year, and revenues in its last four quarters totaled $3.39 billion.

DTZ Rockwood declined to comment.�

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