Maul Of America

General Growth Properties is about to be sued by its bondholders for defaulting. (h/t Atrios)

Citing people familiar with the matter, the newspaper said law firm Wilmer Cutler Pickering Hale and Dorr LLP sent a letter to General Growth saying it represents holders of 25 percent of its $395 million in bonds that were due last March 16 and weren't paid. The bondholders are seeking to have their trustee, Bank of New York Mellon Corp (BK.N), sue General Growth for payment, in a step that could push the company closer to bankruptcy, The Wall Street Journal said.

General Growth, which owns more than 200 U.S. malls, has defaulted on several mortgages as well as a series of bonds. The company has been negotiating with its creditors for months, and has said that if it was unable to refinance its maturing debt, it might have to file for bankruptcy protection.

Let that sink in for a sec. The owner of 200 malls across the country, GGP, is basically broke and on the verge of bankruptcy. A whole lot of these malls are losing money so badly right now that they will have no choice but to close a whopping number of them. Internet sales and the economy are killing these places. Commercial real estate is a disaster right now, and it's basically the next bomb to drop on our already floundering economy.

Will Obama bail out the malls too? How much of our retail sector will vanish when retail sales continue to plummet? Those jobs are going to vanish, folks. For the most part, they're not coming back. The world is changing, and fast.