Going Coastal

General Growth Properties Inc., the mall owner at risk of bankruptcy, received offers of almost $400 million for properties including Boston’s Faneuil Hall and New York’s South Street Seaport, according to a person familiar with the matter.

General Growth, the No. 2 U.S. shopping-mall owner, put the two properties and Harborplace & the Gallery in Baltimore up for sale in December. More than 10 bids were received and General Growth may sell the properties individually or as a package with offers of almost $400 million for all three, said the person, who asked not to be identified because the sales aren’t public.

General Growth is negotiating with lenders and selling real estate to remain solvent. The company last week said it has $1.18 billion in past-due debt, and warned again it may be forced into bankruptcy. The company has cut its workforce by 20 percent, suspended payment of its cash dividend, and halted or slowed development and redevelopment projects.

The Chicago-based company is likely to choose a buyer for Faneuil Hall, South Street Seaport and Harborplace & the Gallery in the next several weeks, the person familiar with the sale said. The person wouldn’t identify the bidders, which included private groups, buyers from overseas and real-estate developers. The highest bids total almost $400 million for all three properties, the person said.

General Growth spokesman Tim Goebel declined to comment.

‘Unique Assets’

“We haven’t given interim updates on the asset-sales progress,” he said. “When we have something to announce, we’ll announce it.”

The three properties, acquired when General Growth purchased Rouse Co. for $11.3 billion in 2004, are “unique assets” that likely will be sold to a buyer experienced in running “operator- heavy properties,” said Dan Fasulo, managing director of Real Capital Analytics Inc., a New York-based property-research firm.

“You’re not going to get a novice coming in here and trying to get these to work,” Fasulo said. “You need someone who has some experience running a lifestyle-type asset. There will be a finite number of people looking at these.”

General Growth is the owner or manager of more than 200 malls in 44 states, making it the largest mall owner after Simon Property Group Inc. General Growth said in a December sales brochure that the sale of the New York, Boston and Baltimore properties “represents the extraordinary opportunity to acquire three world-class destination mixed-use assets” that offer “in- place income in excess of $30 million and significant upside potential through redevelopment and expansion.”

Biggest Property

Harborplace & the Gallery, located on Baltimore’s Inner Harbor, is the biggest of the three properties, with 284,683 square feet of retail space and 259,770 feet of office space. The retail portion is 85.6 percent occupied and has sales per square foot of $522, and the office space is 77.3 percent occupied, according to the sales brochure.

Faneuil Hall Marketplace, which dates to 1742 and also is known as Quincy Market, has 195,647 square feet of retail space with sales per square foot of $719 and an 89.9 percent occupancy rate. The office portion is 88.8 percent occupied.

South Street Seaport, a center near the Brooklyn Bridge that General Growth has been trying to redevelop, has 285,847 square feet of retail space that is 94.3 percent occupied. It has sales per square foot of $598, according to the brochure.

General Growth fell 8 cents to 38 cents as of 4 p.m. in New York Stock Exchange composite trading. The shares traded as high as 60 cents, up 30 percent from yesterday’s close, after the mall offers were reported. They’ve dropped 99 percent in the past year.

By Daniel Taub

Bloomberg