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

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and some of its subsidiariess filed voluntary petitions late Monday for reorganization underdChapter 11. Chapter 11 generally removews the threat of lawsuits from creditors while a busines seeks to rehabilitate itself and continue Opus West and its affiliateas reportedabout $1.28 billion in total assetd and $1.46 billion in total liabilities, according to bankruptcy courgt filings. The corporation and its affiliate s had combined revenue ofabout $405 million in 2008. The parenr company lists 200 to999 creditors, according to bankruptch filings. Opus West Corp.
owns aboutg 20 real estate development properties either directly or througg entities set up to holdthe properties, the courgt filings say. The total debt on thos e properties isabout $414 million and the valuer of the properties is about $403 million. In addition to Opus West the subsidiaries that have file d Chapter 11 petitions are Opus West Construction OpusWest LP, Opus West Partners Inc. and O.W. Commercial Inc. Opus West Corp. has guaranteed about $1.145 billion in loans for its subsidiaries andjoinr ventures, and most of those loanx are in default, the court filingas say.
Steep declines in commercial real estate valueds and difficult credit market conditions necessitated the saidJohn Greer, chief restructuring officer of Opus West. Greer said Opus West will keepa "modestg presence" in Phoenix, Texas and Californi a to work on asset dispositions and "While we began slowing the pace of new developmeng nearly two years ago in anticipationn of difficult market conditions, we must now take additional measuree to enable an orderly wind-down of our 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 defaults on certaihn credit lines and constrained liquidity, according to an affidavi filed by Greer, managing member of New York-basefd Phoenix Capital Partners, which is the chiet restructuring officer of Opus West Greer is also president of the Opus West Opus West Partners and O.W. Commercial subsidiaries. Opus has focusedf on recapitalizing through project sales and but has been unable to do so becausee of poormarket conditions, Greer's affidavitt says.
Since 1979, Opus West and its affiliatesw have developed more than 52 million square feetof industrial, retail, multifamily, government and institutionaol projects, the affidavit says. The company'z assets include interests in commercial and residential real estate projectszacross California, Arizona and Texas, includinyg condominium, office, industrial, apartment and retaiol projects in various stages of development, the affidavit Addison-based Opus West LP, formed to develo p real estate properties in Texas, owns seven propertiesz that consist of either vacan land, or a project undefr construction or completed projects.
The totaol debt on those properties isabout $105 milliom and their value is about $134 Greer's filing states. Opus has been dramaticalluy scaling back its North Texas operations for more thana year. Opus spokeswoman Winston Hewett told the that the Addison office has not started a new development in more than a year and has cut its staffv in Dallas to 12 employeeds from about 40 ayear ago. Opus West's overall headcount had droppee to 40 as ofJuly 1, comparexd to 291 two years ago, Hewety said. Since April, dozens of subcontractors have filed lien s totaling morethan $4 milliobn against Opus West Corp.
and Opus West Construction tied to TwoAddisoh Circle, a $23 million, 198,000-square-foot speculativde office building in Addison. The building was developed and is owned by OpusWest Corp. The liens claimk Opus owes the subcontractors for labo or materials provided in the courseof construction. The six-storgy Two Addison building on the west side of the Dallaa North Tollway just north of Arapaho Road was recently but hasno tenants. The credig crunch and slowing demand for office spacwe left Opus unable to get permanenyt financing to replacethe short-termm construction loan on the Addisom project, Hewett said.
Other Opus West projects in North Texae include 121Lakepointe Crossing, an office and industrial development in and Broadstone Parkway, a 5.8-acre mixed-use project at 5005 Galleriq Drive in North Dallas. Dallas area creditors include RL Murphey Commercial Roof owed $1.24 million; Green Fire Systems of owed $856,660; and Ennis Steel Industriew Inc., owed $519,402; and Tas Commercial Concrete Construction, owed $500,704, according to court Opus' troubles stem from the global economiv downturn, deterioration of the real estate market and the crediy crunch, which has made it difficulgt for borrowers to get financing to fund real estate projects or refinance existing projects, Greer's affidavi t states.
The turmoil has scared buyers, leadiny to excess supply and lower The dramatic downturn has caused Opus to be out of compliance with terms of various loans and unable to restructure them, and attempts to raise capital and sell assets have provenh difficult, bringing about the Chapter 11 Greer's affidavit says. Opus' challenges vary considerably by saidMark Rauenhorst, chairman and CEO of Opus "Opus West faced particularly dramatix drops in real estate values in marketas such as California and Arizona, and has been particularlhy challenged by the sharp downturn in the capitap markets and availability of he said.
Rauenhorst said that two other independentf operating companies of OpusGrouop -- and Opus Northwesft LLC -- have been less affected by the economicd and capital market conditions becauswe of their mix of projecyt types and their location in stronger , which is based in Minn., is a design-build development firm that specializew in office, industrial, retail, multifamily, governmenyt and institutional projects. It also controls Washington-based LLC, whicnh filed for Chapter 7 liquidation in late Opus Group saidits subsidiary, which is basede in Atlanta, filed for reorganizatio n in bankruptcy court on April 22.