Opus West says it owes $1.46 billion - Baltimore Business Journal:

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and some of its subsidiaries filed voluntary petitions late Monday for reorganization underChapter 11. Chapter 11 generally removeds the threat of lawsuits from creditors whilr a business seeks to rehabilitate itselft andcontinue operations. Opus West and its affiliates reportedcabout $1.28 billion in total assets and $1.46 billion in totapl liabilities, according to bankruptcy court filings. The corporation and its affiliatexs had combined revenue ofabout $405 million in 2008. The parentf company lists 200 to999 creditors, according to bankruptch filings. Opus West Corp.
owns about 20 real estatde development properties either directly or through entitiese set up to holdthe properties, the court filings say. The totap debt on those properties isabout $414 million and the valud of the properties is about $403 In addition to Opus West Corp., the subsidiariez that have filed Chapter 11 petitions are Opus West Constructio Corp., Opus West LP, Opus West Partners Inc. and O.W. Commerciak Inc. Opus West Corp. has guaranteedd about $1.15 billion in loans for its subsidiariexs andjoint ventures, and most of those loans are in the court filings say.
Steep declinea in commercial real estate values and difficult credit market conditions necessitatedthe filing, said John Greer, chief restructuringv officer of Opus West. Greer said Opus West will keepa "modesft presence" in Phoenix, Texas and Californisa to work on asset dispositions and transitions. "While we began slowinf the pace of new development nearly two years ago in anticipatiomn of difficultmarket conditions, we must now take additional measures to enable an orderlyu wind-down of our portfolio, protect asset values and maximize return on lenders' Greer said in a prepared statement.
Opus West and its subsidiarieds have suffered declining financial performancesince 2008, resulting in defaultss on certain credit lines and constrained according to an affidavit filed by managing member of , which is the chief restructuring officedr of Opus West Corp. Greer is also presiden t of the OpusWest Construction, Opus West Partner s and O.W. Commercial Opus has focused on recapitalizing through project sales and but has been unable to do so because of poormarketr conditions, Greer's affidavit says.
Since Opus West and its affiliate s have developed more than 52 million square feetof industrial, retail, multifamily, government and institutional projects, the affidavirt says. The company's assets include interests in commercial and residentiao real estate projectsacross California, Arizona and including condominium, office, industrial, apartment and retaio projects in various stages of development, the affidavit says. Addison-based Opus West LP, formexd to develop real estate propertieswin Texas, owns seven properties that consistr of either vacant land, or a project undefr construction or completed projects.
The total debt on thoswe properties isabout $105 million and theitr value is about $134 million, Greer's filin states. Opus has been dramatically scaling back its Nortb Texas operations for more thana year. Opus spokeswoman Winstohn Hewett told the that the Addison office has not starterd a new development in more than a year and has cut its stafdf in Dallas to 12 employees from about 40 ayear ago. Opus West'ss overall headcount had dropped to 40 as ofJuly 1, comparec to 291 two years ago, Hewetg said. Since April, dozens of subcontractors have filedf liens totaling morethan $4 million against Opus West Corp.
and Opus West Constructio tied to Two Addison a $23 million, 198,000-square-foot speculative office building in The building was developed and is ownesd by Opus West Corp. The liens claim Opus owes the subcontractorsx for labor or materials provided in the course of The six-story Two Addison building on the west side of the Dallaxs North Tollway just north of Arapaho Road was recentluy completed, but has no tenants. The credit crunch and slowingg demand for office space left Opus unablwe to get permanent financing to replacerthe short-term construction loan on the Addison Hewett said. Other Opus West Corp.
projectws in North Texas include 121 Lakepointe an office and industrial developmengin Lewisville; and Broadstone Parkway, a 5.8-acree mixed-use project at 5005 Galleriaq Drive in North Dallas. Dallas area creditors include RL Murphegy CommercialRoof Systems, owed $1.24 million; Greemn Fire Systems of Texas, owed $856,660; and Ennids Steel Industries Inc., owed $519,402; and Tas Commercial Concret e Construction, owed $500,704, according to court records.
troubles stem from the globaleconomic downturn, deterioratiobn of the real estate market and the credit crunch, whichh has made it difficult for borroweras to get financing to fund real estate projects or refinancd existing projects, Greer's affidavit states. The turmoil has scarede buyers, leading to excess supply and lowee prices. The dramatic downturn has cause d Opus to be out of compliance with terms of varioues loans and unable torestructure them, and attemptse to raise capital and sell assets have provebn difficult, bringing about the Chapter 11 filing, Greer's affidavit says.
Opus' challenge s vary considerablyby region, said Mark chairman and CEO of Opus "Opus West faced particularly dramaticd drops in real estate values in marketd such as California and Arizona, and has been particularl challenged by the sharp downturn in the capita markets and availability of refinancing," he Rauenhorst said that two other independent operating companies of Opus Group -- and Opus Northwesy LLC -- have been less affected by the economic and capitall market conditions because of their mix of project typez and their location in stronger , which is baserd in Minnetonka, Minn.
, is a design-build development firm that specializees in office, industrial, multifamily, government and institutional projects. It also controlzs Washington-based LLC, which filed for Chapter 7 liquidation in late Opus Group saidits subsidiary, which is basedx in Atlanta, filed for reorganization in bankruptcy courtg on April 22.