If you assume the proceeds of any sale are used exclusively to...

If you assume the proceeds of any sale are used exclusively to pay down debt, then under your description, the company would be going backwards if it sold assets including costs for less than (carrying value x average gearing).

There are also some bigger issues, which the lenders understood quickly. These are simply that, with so few transactions in the market, a distressed, highly discounted sale of assets by Centro means ALL shopping centre REITs will need to revalue their portfolios thus causing further distress and a continuation of the cycle downwards. In some ways, the fact that there have been few sales (and thus a lack of transactional evidence) in the market is a blessing.

The other issue of course is that when an asset is taken off the books, the revenue associated with it also disappears. Centro may have been able to retain some management fees, but they would have lost most of the revenue by selling a centre. So long as the asset is generating a higher revenue than the costs associated with it, Centro were going to be ahead. There are also some scale advantages in having a large portfolio which would have been eroded.

Had Centro been forced to sell assets, in the current environment, the higher quality ones would have had to go first. These are of course the ones generating the best income and probably the highest margins. Selling them would have compounded the situation considerably.

I think everyone is in agreement that the lenders have made a very wise choice.