Shares in General Growth Properties Inc., owner of Ala Moana Center and Ward Centers, plummeted yesterday after the company said it may file for bankruptcy if it can't refinance or extend nearly $1 billion in debt due next month.

The nation's second-largest mall owner also disclosed in a regulatory filing late Monday that it may default on certain debt obligations.

Making matters worse is another $3.07 billion in property and corporate debt set to come due next year.

The company's problems stem from its $11.3 billion purchase of mall operator Rouse Co. in 2004. Financed almost entirely with debt, it left the company highly leveraged ever since.

George Whalin, president of Retail Management Consultants in Southern California, said he believed General Growth probably will file for bankruptcy. "I think there's a better-than-average chance that is going to happen," he said while vacationing yesterday in Wailea, Maui.

Will General Growth be forced to sell some of its Hawai'i properties? Whalin said the answer to that depends in part on what chapter of bankruptcy law the company employs.

If it chooses to reorganize finances under Chapter 11, General Growth will need to line up something called debtor-in-possession financing that gives it the financial liquidity to remain operating, Whalin said.

He said bankrupt companies will try to work out some sort of payment arrangement with creditors. But it is possible that creditors will ask that assets be sold. Whalin said a number of factors go into whether properties are chosen for sale, including how attractive they may be for prospective owners.

"Typically what has happened in the past when shopping center developers have gone bankrupt or gone out of business is that other operators come in and bought properties," Whalin said.

"But the problem is none of these guys is in great shape now. Consumers aren't spending money and we've got lots of retailers going bankrupt. We've got lots of empty spaces in these shopping centers so everybody is suffering here."

That probably doesn't apply to Ala Moana Center, which Whalin said is one of the world's premier shopping centers.

"They'll sell off what they can sell off to get the most bang for their buck," he said.

LOANS DUE DEC. 1

General Growth may not be able to refinance or reschedule the loans, due Dec. 1, because of the crisis in the credit markets, according to a filing the company made after the close of regular trading Monday.

"Given the continued weakness of the retail and credit markets, there can be no assurance that we can obtain such extensions or refinance our existing debt or obtain the additional capital necessary to satisfy our short-term cash needs on satisfactory terms," the Chicago-based real estate investment trust said in filing with the Securities and Exchange Commission. "... Our potential inability to address our 2008 and 2009 debt maturities in a satisfactory fashion raises substantial doubts as to our ability to continue as a going concern."

General Growth, beset by falling revenue from operations and plagued by a tightening global credit market that's making it difficult for companies to obtain financing, is trying to sell properties and cut costs to weather the rocky economy. It's also suspended its dividend and ousted a cadre of top executives. But that hasn't calmed investors, who've sent the company's shares into a virtual free-fall since September.

Rich Moore, managing director at RBC Capital Markets in Cleveland, said he doesn't believe the SEC filing means the company is on the verge of filing for bankruptcy protection. Rather, it used the SEC filing to pressure creditors and alert investors to the risks confronting General Growth, Moore said.

General Growth closed down 88 cents, or 64 percent, to 49 cents per share yesterday on the New York Stock Exchange.