Wachovia Upgrades General Growth To 'Outperform' Despite $4 Billion In Debt

New York, NY (AHN) - Investors on Wall Street have shown confidence in General Growth Properties, Inc (NYSE: GGP), the second largest shopping mall company in the country, amid declining consumer spending.

Wachovia Corp. (NYSE: WB) upgraded the company on Friday to "outperform," citing upside potential return limits down risk.

"We believe GGP will inevitably need to reduced leverage ideally through sale of JV interests but potentially through a common equity sale," the brokerage firm's analyst said in a statement to its clients..

The company then announced that it has sacked Bernard Freibaum, as the Company's senior vice president and chief financial officer. Edmund Hoyt was appointment to succeed Hoyt on an interim basis.

One of the reasons Freibaum was asked to step down is that he sold the company's shares after the NYSE added the firm to a list of companies on the coveted "no-short" list. The U.S. SEC has banned "naked" short-selling on Wall Street.

"The Company has been informed by Mr. Freibaum that on October 2, 2008, he sold approximately 2.95 million shares of common stock to satisfy margin calls and applied all of the proceeds to repay outstanding margin debts," the company said in the statement.

General Growth said it "do not intend to sell" any of their shares of Company stock.

The Chicago-based shopping mall operator, a self-administered and self-managed real estate investment trust, also suspended its dividend to save some capital "given the uncertainty and volatility in the capital markets."

"The Company continues to be current on all of its debt obligations and is continuing its full financial and strategic review with its advisors," the firm said on Friday.

The stock of the company closed higher on Friday by $2.08 or 27.40 percent at $9.67 in New York Stock Exchange composite trading.

The shares have lost as much as 70 percent over the last four months as the company struggles to refinance $1 billion in debt coming due by the end of 2008. The company will still have $3 billion in debt coming due at the end of 2009.