General Growth Properties Restructuring PlanGeneral Growth Properties Inc., which filed the largest bankruptcy in U.S. history, has finished restructuring its $15 billion secured-debt load, clearing yet another obstacle from its path as it attempts to exit Chapter 11 bankruptcy.

Bankruptcy Judge Allan Gropper in Manhattan today approved a restructuring agreement on a $95 million loan tied to a Louisiana mall. It’s the last of the Chicago company’s secured debt that needed to be restructured in bankruptcy, Anup Sathy, a lawyer for General Growth, said in court.

General Growth reached agreements with lenders on a total of 108 loans worth $15 billion, Sathy said. The debt is tied to 144 properties. The deal approved today, on the Oakwood Center mall in Gretna, Louisiana, extends the maturity of the loan to June 1, 2014, according to court papers.

By extending the maturity of their secured loans in Chapter 11 bankruptcy, General Growth will lower its monthly debt obligations and give the company a longer period of time to repay its outstanding loans while keeping its assets.  One of the benefits of Chapter 11 bankruptcy is that it allows business debtors (and some individuals) to keep their assets while repaying debt under reasonable terms.  However, failure to keep to those repayment terms could end with the debtor eventually losing their assets anyway or needing to file another bankruptcy.

General Growth’s next step is to secure financing that will allow it to fund its exit from Chapter 11 bankruptcy.  Bankruptcy financing is critical to the success of most business who file Chapter 11 bankruptcy because it gives the company enough capital to survive the first tentative steps outside of bankruptcy and keep its debt repayment obligations.

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