Mall properties filing for bankruptcy. (creditors, court, profit, organization)

[NDak15]

Curious what happens if a mall company files for bankruptcy but there are still profitable stores in the mall. Would those stores still close?

[CaptainNJ]

only if the mall closes.

[JONOV]

Originally Posted by NDak15

Curious what happens if a mall company files for bankruptcy but there are still profitable stores in the mall. Would those stores still close?

Depends..."Bankruptcy" can mean a few things under US law. BUt probably.

[Mircea]

Originally Posted by NDak15

Curious what happens if a mall company files for bankruptcy but there are still profitable stores in the mall. Would those stores still close?

There's no way to answer that based on the information you provided.

If the property owners -- the people who actually own the land and the structures -- file a Chapter 11, then it's just a reorganization.

The Court appoints a trustee as receiver. It's unlikely a receiver would evict paying tenants of the mall, since the receiver's fiduciary duty is to maximize revenues and minimize losses.

If it is a Chapter 7, that is total liquidation, meaning the mall would be sold to pay off creditors.

The new owners may decide to continue operating the mall, or they may decide to raze the mall and redevelop perhaps with new retail, or a combination of residential housing (like condos and apartments) and retail. That would, of course, depend on the zoning for that parcel of land.

[anononcty]

Malls were dying. Dead malls have become a hobby for some. It is creepy but it's a reminder if a business is poorly planned, priced and/or promoted.

https://allthatsinteresting.com/abandoned-malls

Many owners usually a reit wind up walking or go through a strategic forclosure. Problem is rents are so high that higher priced stores frequently are the only ones that can rent space. People can buy more cheaper stuff than expensive stuff especially with the big box retailers.