Recent Congressional testimony indicates that bankruptcy reforms made in 2005 to strengthen the rights of commercial landlords and implement short deadlines for accepting or rejecting leases, has made it virtually impossible for retail businesses (of any size) to emerge from bankruptcy on a reorganized basis (at least in anything other than a prepackaged plan agreed to in advance by all key parties).
Even in the comparatively good times of 2006-2007 only two of several dozen retailers managed to emerge reorganized from a bankruptcy.
It turns out that some of the most economically important value in a major retail business is the right that it has to pay below market commercial lease rates on old, long term leases. Short deadlines for affirming or rejecting those leases makes it hard to convert that value into value for creditors of the firm. So, the 2005 law provides a windfall to landlords at the expense of operating retail businesses.
Andrew, I see your point now. Thanks for the information. Very nice blog.
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