Mall Shakeout Just Beginning as Complex Debt Drowns Owners (1)

The two U.S. mall owners that filed for bankruptcy on Sunday could be just the beginning.

As retailers ranging from J.C. Penney Co. to Brooks Brothers Group Inc. go bust, their landlords are struggling, too. But rescuing malls will be unusually complicated because the properties have byzantine webs of financing that have only grown more elaborate with time. Interest groups ranging from lenders to shareholders to tenants to holders of complex mortgage bonds are wrangling over how to fix the situations, and for many large property owners, bankruptcy will be the only option, restructuring professionals said.

A shopper at Hudson Yards mall in New York, on Sept. 9.

Photographer: Peter Foley/Bloomberg

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