8-K

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of Earliest Event Reported): October 19, 2009

Forest City Enterprises, Inc.
__________________________________________
(Exact name of registrant as specified in its charter)

Ohio	1-4372	34-0863886
_____________________ (State or other jurisdiction	_____________ (Commission	______________ (I.R.S. Employer
of incorporation)	File Number)	Identification No.)
Terminal Tower, 50 Public Square, Suite 1100, Cleveland, Ohio		44113
_________________________________ (Address of principal executive offices)		___________ (Zip Code)

Registrant’s telephone number, including area code: 216-621-6060

Not Applicable
______________________________________________
Former name or former address, if changed since last report

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

[  ]  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[  ]  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[  ]  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[  ]  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 8.01 Other Events.

On October 19, 2009, Forest City Enterprises, Inc. (the "Company") issued a press release providing updates on the modification and renewal of its revolving credit facility and other financing activity.

On October 19, 2009, the Company also issued a press release announcing that, subject to market and other conditions, it intends to offer $175 million aggregate principal amount of its Convertible Senior Notes due 2016 (the "Notes") to qualified institutional buyers pursuant to Rule 144A under the Securities Act. The company also announced that it expects to grant the initial purchasers a 13 day option to purchase up to an additional $25 million aggregate principal amount of the notes to cover overallotments, if any.

A copy of these press releases are filed as Exhibits 99.1 and 99.2, respectively, to this report and are incorporated into this Item 8.01 by reference.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

Exhibit No. Description

99.1 Press Release of Forest City Enterprises, Inc. Dated October 19, 2009.
99.2 Press Release of Forest City Enterprises, Inc. Dated October 19, 2009.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	Forest City Enterprises, Inc.
October 19, 2009	By:	/s/ Robert G. O'Brien
		Name: Robert G. O'Brien
		Title: Executive Vice President and Chief Financial Officer

Exhibit Index

Exhibit No.	Description
99.1	Press Release of Forest City Enterprises, Inc. Dated October 19, 2009.
99.2	Press Release of Forest City Enterprises, Inc. Dated October 19, 2009.

EX-99.1

Exhibit 99.1

AT THE COMPANY	ON THE WEB
Robert O’Brien	www.forestcity.net

Executive Vice President – Chief Financial Officer
216-621-6060

Jeff Linton
Vice President – Corporate Communication
216-621-6060

For immediate release

Forest City provides update on credit line renewal, other financing activity

CLEVELAND, Ohio – October 19, 2009 – Forest City Enterprises, Inc. (NYSE:FCEA and FCEB) today provided a progress update on the modification and renewal of its $750 million revolving credit facility, and also announced extensions and refinancings among its property-level, non-recourse debt maturities.

The Company has received preliminary, non-binding commitments from a majority of its current 14-member bank group to participate in a renewed revolving credit facility. The preliminary commitments are based on a revised term sheet that is the subject of active discussions between the Company and its lenders, and are conditional on approval of the term sheet by all participating lenders, and any or all of the lenders who have preliminarily approved the term sheet may retract their approvals. Preliminary commitments to date account for approximately 60 percent of the total commitment being sought. While the Company cannot predict the outcome of this approval process and any further negotiations with the lenders, the term sheet for the extension of the facility contemplates a reduced total commitment from the lenders, increased borrowing costs, modification to the financial covenants and the addition of operational covenants. If approved, additional terms and conditions of the facility will be announced at the time of closing. The current facility is scheduled to mature in March 2010.

Separately, Forest City announced $150.3 million, at 100 percent ($97.2 million related to consolidated properties and $53.1 million related to unconsolidated properties), in refinancings and loan extensions not previously reported.

The Company closed the following transactions related to consolidated properties:

• On September 30, 2009, the Company closed a three-year extension of a $90.8 million loan for 2 Hanson Place, a 10-story, 399,000-square-foot office building adjacent to the Company’s Atlantic Terminal retail center in Brooklyn, NY; and

• Also on September 30, the Company closed a $6.4 million, 10-year refinancing for Lofts 23, a 51-unit, loft-style apartment property at the Company’s University Park at MIT in Cambridge, MA.

In addition, the Company closed the following transactions related to unconsolidated properties:

• A $17.7 million, two-year extension of financing, at 100 percent, related to Sterling Lakes, a master-planned community in Pepper Pike, OH, which closed on September 30;

• A $4.9 million refinancing, at 100 percent, related to Perrytown Place Apartments, a 231-unit, senior housing apartment community in Pittsburgh, PA, also closed on September 30; and,

• A $30.5 million, five-year refinancing, at 100 percent, for Golden Gate Plaza, a 361,000-square-foot specialty retail center in suburban Cleveland, which closed on October 1.

About Forest City Enterprises, Inc.

Forest City Enterprises, Inc., is an $11.7-billion NYSE-listed national real estate company. The Company is principally engaged in the ownership, development, management and acquisition of commercial and residential real estate and land throughout the United States. For more information, go to www.forestcity.net.

Safe Harbor Language

Statements made in this news release that state the Company’s or management’s intentions, hopes, beliefs, expectations or predictions of the future are forward-looking statements. The Company’s actual results could differ materially from those expressed or implied in such forward-looking statements due to various risks, uncertainties and other factors. Risks and factors that could cause actual results to differ materially from those in the forward-looking statements include, but are not limited to, the impact of current market conditions on our liquidity, ability to finance or refinance projects and repay our debt, general real estate investment and development risks, vacancies in our properties, further downturns in the housing market, competition, illiquidity of real estate investments, bankruptcy or defaults of tenants, anchor store consolidations or closings, international activities, the impact of terrorist acts, risks associated with an investment in a professional sports team, our substantial debt leverage and the ability to obtain and service debt, the impact of restrictions imposed by our credit facility and senior debt, exposure to hedging agreements, the level and volatility of interest rates, the continued availability of tax-exempt government financing, the impact of credit rating downgrades, effects of uninsured or underinsured losses, environmental liabilities, conflicts of interest, risks associated with developing and managing properties in partnership with others, the ability to maintain effective internal controls, compliance with governmental regulations, volatility in the market price of our publicly traded securities, litigation risks, as well as other risks listed from time to time in the Company’s SEC filings, including but not limited to, the Company’s annual and quarterly reports.

# # #

Exhibit 99.2

AT THE COMPANY
Robert O’Brien
Executive Vice President – Chief Financial Officer
216-621-6060

Jeff Linton
Vice President – Corporate Communication
216-621-6060

For immediate release

Forest City to Offer $175 Million Convertible Senior Notes

CLEVELAND, Ohio – October 19, 2009 – Forest City Enterprises, Inc. (NYSE:FCEA and FCEB) today announced its intention to offer, subject to market and other conditions, $175 million aggregate principal amount of convertible senior notes due 2016 (“the Notes”). The Notes will be offered to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”).

The Notes are expected to be convertible, at the holder’s option, into Forest City’s Class A common stock at any time prior to the close of business on the second scheduled trading day immediately preceding the maturity date. The interest rate, conversion rate, conversion price and other terms of the Notes will be determined by negotiations between Forest City and the initial purchasers of the Notes. Forest City expects to grant to the initial purchasers a 13-day option to purchase up to an additional $25 million aggregate principal amount of Notes to cover overallotments.

The Notes will be general senior unsecured obligations of Forest City Enterprises, Inc.

In connection with the offering, Forest City intends to enter into convertible note hedge transactions with affiliates of one or more of the initial purchasers of the Notes (“the counterparties”). The convertible note hedge transactions are intended to reduce, subject to a limit, the potential dilution with respect to Forest City’s Class A common stock upon conversion of the Notes. If the initial purchasers of the Notes exercise their overallotment option to purchase additional Notes, Forest City expects to use a portion of the net proceeds from the sale of such additional Notes to enter into additional convertible note hedge transactions.

In connection with establishing their initial hedge of these transactions, the counterparties have informed Forest City that they expect to enter into various derivative transactions with respect to Forest City’s Class A common stock concurrently with or shortly after the pricing of the Notes. In addition, the counterparties have informed Forest City that they are likely to modify their hedge positions by entering into or unwinding various derivative transactions with respect to Forest City’s Class A common stock and/or by purchasing or selling shares of Forest City’s Class A common stock or other of Forest City’s securities (including the Notes) in secondary market transactions during the term of the Notes.

Forest City expects to use the net proceeds from the offering to pay the cost of the convertible note hedge transactions, to reduce outstanding borrowings on the Company’s $750 million revolving credit facility, and for general corporate purposes, which, depending on prevailing market conditions, could include repayment of debt with earlier maturities.

The Notes and the shares of Forest City’s Class A common stock issuable upon conversion of the Notes have not been registered under the Securities Act, or any state securities laws, and unless so registered, may not be offered or sold in the United States except pursuant to an exemption from the registration requirements of the Securities Act and applicable state laws.

No Solicitation

This press release shall not constitute an offer to sell or a solicitation of an offer to buy nor shall there be any sale of these securities in any state or other jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or other jurisdiction.