Since most JCP real estate is pledged against loans from Goldman...
Does putting cash into real estate development enhance Goldman's position in a bankruptcy?
If so, how does Goldman benefit more than just leaving the cash in JCP?
Is it a matter of timing? Getting the cash into real estate while there is still cash to move?
Messner....the biggest questions from my perspective are: "Why?" and "What is to be gained by such a maneuver?" Obviously, JCP feels that they can squeeze money out of this asset...but developing it will take time...something JCP sorely lacks. Why not just sell the entire property with a lease back arrangement? It seems to me that JCP is diverting their attention to a business that is not their core area of expertise...real estate development. But, then again, what's one more dumb move?
Seems to me leasing property at $4.00 a square foot, while others are paying much, much more indicates that JCP ain't doing too badly for negotiating a non core area of expertise...
This wouldn't be the first time JCPenney has sold "Non-core" assets - - - and we can see how much good that half billion did - - - there'll be more info leaked out piece by piece over the next few days and knowing JCPenney the way they've been doing, they'll find a way to screw it up - - -
If you don't have copies of all the debt agreements, you can't know what they say. It's quite possible that the home office real estate is not encumbered. Even encumbered real estate can be sold, the revenue used to pay retire the mortgage, and the property leased back for a net gain in liquidity.
you can't know what they say. It's quite possible that the home office real estate is not encumbered.
Do some DD - check your May 14, 2013 8-k - - - it lists the Home office and the distribution centers, owned by JCPenney Properties(that's different than the rest as they are owned by JCPenney Holding) as "Pledged" for the GS loan - - - - sometimes you're so childlike