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15 April 20242 minute read

DLA Piper advises PREIT in financial and corporate restructuring

DLA Piper advised Pennsylvania Real Estate Investment Trust (now PREIT Realty) and its direct and indirect subsidiaries (PREIT), a leading owner and operator of retail real estate, in the completion of the company’s financial and corporate restructuring.

Through the restructuring effort, PREIT reduced its total debt by approximately US$835 million through the second lien debt for equity swap, extended its senior facility maturity runway, and received commitments of new money exit revolver financing (in addition to debtor-in-possession financing) from a group of investors. Importantly, all general unsecured creditors and property-level debt lenders remained unimpaired as the company was able to maintain business as usual during its in-court restructuring.

In addition, under the company’s prepackaged plan of reorganization, PREIT's then existing equity interests, including US$384 million of preferred equity interests, were extinguished in exchange for a US$10 million cash distribution. Further, as a result of the corporate reorganization, PREIT emerged as a private company.

“It was a pleasure to work with the exceptional PREIT team on this crucial restructuring effort, which required the coordination and collaboration of many teams across practice areas and jurisdictions as well as numerous advisors on each side,” said Oksana Rosaluk (Chicago), the DLA Piper partner who led the restructuring efforts together with Rick Chesley (Chicago), Co-US Managing Partner and Global Managing Partner.

In addition, the financing team was led by Shmuel Klahr (New York) and Kira Mineroff (Short Hills), the real estate team was led by Stacy Osmond (Chicago) and included REIT tax partner Shiukay Hung (New York). Corporate guidance was provided by Christopher Paci (New York) and Christina Houston (Wilmington), and Witek Jurewicz (New York) provided tax advice.