Short Case for GGP

In one corner, Bill Ackman and Pershing Square's Long Thesis on GGP. In the other corner, Hovde Capital's Short Case for GGP.

A very well laid out presentation. For full disclosure, I am completely flat in the name.

General Growth Properties - Short Case


JB 12/16/2009  



Anonymous,  12/16/2009  

hunter- you didn't actually read the presentation, did you?

Mark 12/16/2009  

Hunter, even Hovde knows it's not a quality presentation. Anybody that attended college and can reason with any shred of significance can see that. I can't believe you posted this garbage and called it "a very well laid out presentation."

Azeem 12/17/2009  

I think Whitney Tilson's rebuttal says it all: http://bit.ly/5IGuhf

Thanks for posting up Hovde's presentation, the situation is certainly an interesting one.

Hunter 12/17/2009  

Until Tilson and Todd Sullivan start segregating the Rouse assets and the GGPLP LLC assets I cannot even begin to listen to their arguments. They could also convince me if they brought up a plausible argument of substantive consolidation, but alas, no one has done that either. Further, making the assumption that cash flow to the equity will be the same as it was pre-org is blatantly wrong - the re-org of the soon to exit mall properties assume higher amortization payments i.e. less cash flow to equity.

JB 12/17/2009  

Another take...

Hovde's valuation conclusion may be right in the end (who knows if it will be for the right or wrong reason). And while I haven't seen anyone do the analysis you suggest I think Tilson and Sullivan highlight some points on data consistency and comparability that should not be overlooked.

Lawrence D. Loeb 12/18/2009  


It's a pretty weak analysis.

When you start taking top line numbers to generate and EBITDA, you end up ignoring the specifics. For example, $534.9 mm of impairment charges are included in 9/30/09 YTD vs. $116,6 FYE 12/31/09. So $418.3 of the $683.6 mm change is due to "impairment charges," which are non-cash and are, generally, one-off adjustments.

There are other items, both favorable and unfavorable, that are evident if you read the statements and notes; but this analysis seems to be conducted from a 100k altitude. In distressed, you not only have to see the trees from the forest - you need to be able to test the bark.


hunter [at] distressed-debt-investing [dot] com

About Me

I have spent the majority of my career as a value investor. For the past 8 years, I have worked on the buy side as a distressed debt and high yield investor.