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When the Tenant Files for Bankruptcy
The timing of the filing of a shopping center tenant's bankruptcy filing may be affected by many factors, including, among others, the tenant's liquidity, down turns in sales and secured creditor issues. In order to preserve cash on hand and to limit the payments the landlord will receive in distributions in bankruptcy, the tenant debtor often times its filing to occur after the first of the month, when rent and other lease payment obligations are commonly due, thus making the rent for the month prior to the filing date a pre-petition claim.
What Happens to the Landlord?
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