Opus West says it owes $1.46 billion - Minneapolis / St. Paul Business Journal:

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and some of its subsidiariexs filed voluntary petitions late Mondauy for reorganization underChapter 11. Chapter 11 generally removes the threaf of lawsuits from creditors while a business seeks to rehabilitate itself andcontinue operations. Opus West and its affiliatesw reportedabout $1.28 billion in total assets and $1.47 billion in total liabilities, according to bankruptcy courtg filings. The corporation and its affiliates had combined revenu ofabout $405 million in 2008. The parent companyy lists 200 to999 creditors, according to bankruptcy filings. Opus West owns about 20 real estate development properties eithedr directly or through entities set up to hold the the courtfilings say.
The total debt on those propertiesx isabout $414 million and the value of the propertiee is about $403 million. In addition to Opus West the subsidiaries that have filed Chapte r 11 petitions are Opus WestConstruction Corp., Opus West LP, Opus West Partnersx Inc. and O.W. Commercial Inc. Opus West Corp. has guaranteede about $1.15 billion in loans for its subsidiarie andjoint ventures, and most of those loansz are in default, the court filings say.
Stee p declines in commercial real estatse values and difficult credit market conditions necessitatedfthe filing, said John Greer, chie restructuring officer of Opus Greer said Opus West will keep a "modest in Phoenix, Texas and California to work on assetf dispositions and transitions. "While we begaj slowing the pace of new development nearlyu two years ago in anticipation of difficulgmarket conditions, we must now take additionapl measures to enable an orderlt wind-down of our portfolio, protect asset valueas and maximize return on lenders' investment," Greetr said in a prepared statement.
Opus West and its subsidiaried have suffered declining financial performancesincs 2008, resulting in defaults on certain creditf lines and constrained liquidity, according to an affidavit filed by managing member of New York-based Phoenix Capital Partners, which is the chieft restructuring officer of Opus West Greer is also presidenr of the Opus West Construction, Opus West Partners and O.W. Commerciaol subsidiaries. Opus has focused on recapitalizing throug h project salesand refinancing, but has been unables to do so because of poor market Greer's affidavit says.
Since 1979, Opus West and its affiliatexs have developed more than 52 million square feetof office, industrial, multifamily, government and institutional projects, the affidavit The company's assets include interests in commercial and residential real estat e projects across California, Arizona and including condominium, office, industrial, apartment and retail projectes in various stages of development, the affidavit Addison-based Opus West LP, formed to develoo real estate properties in Texas, owns seven properties that consisr of either vacant land, or a project undetr construction or completed projects.
The total debt on those propertiea isabout $105 million and their value is aboutg $134 million, Greer's filing states. Opus has been dramatically scaling back its Norty Texas operations for more thana year. Opus spokeswoma Winston Hewett told the that the Addisob office has not started a new developmeny in more than a year and has cut its stafv in Dallas to 12 employees from aboug 40 ayear ago. Opus West's overall headcount had droppedf to 40 as ofJuly 1, comparerd to 291 two years ago, Hewett said. Sincew April, dozens of subcontractors have filec liens totaling morethan $4 million against Opus West Corp.
and Opus West Constructiojn tied to TwoAddison Circle, a $23 million, 198,000-square-footy speculative office building in Addison. The building was developec and is owned by Opus West The liens claim Opus owes the subcontractords for labor or materials provided in the coursedof construction. The six-story Two Addisoh building on the west side of the Dallas North Tollway just northy of Arapaho Road was recently but hasno tenants. The credit crunch and slowinh demand for office space left Opus unable to get permanent financing to replacethe short-term constructionh loan on the Addison Hewett said. Other Opus West Corp.
projects in North Texas include 121Lakepointe Crossing, an office and industrial developmentr in Lewisville; and Broadstone Parkway, a 5.8-acre mixed-use projectg at 5005 Galleria Drive in North Dallas. Dallae area creditors include RL Murphey CommercialRoof Systems, owed $1.24 million; Greenj Fire Systems of Texas, owed $856,660; and Enniz Steel Industries Inc., owed $519,402; and Tas Commercial Concretw Construction, owed $500,704, according to cour records.
Opus' troubles stem from the globaleconomic downturn, deterioration of the real estate market and the credift crunch, which has made it difficult for borrowers to get financintg to fund real estate projectds or refinance existing projects, Greer'se affidavit states. The turmoil has scaredf buyers, leading to excess supply and lower prices. The dramatic downturn has causedf Opus to be out of compliancer with terms of various loans and unablwe torestructure them, and attempts to raise capital and sell assets have proven difficult, bringing about the Chaptet 11 filing, Greer's affidavif says.
Opus' challenges vary considerably by region, said Mark chairman and CEO ofOpus Corp. "Opux West faced particularly dramatic drop s in real estate valuesa in markets such as Californiaand Arizona, and has been particularly challengex by the sharp downturn in the capital marketxs and availability of he said. Rauenhorst said that two other independent operating companiese of OpusGroup -- and Opus Northwestg LLC -- have been less affected by the economic and capital market conditions becausw of their mix of projecg types and their location in stronger markets. , which is based in Minnetonka, Minn.
, is a design-build development firm that specializessin office, industrial, retail, multifamily, government and institutionap projects. It also controls Washington-based LLC, whicy filed for Chapter 7 liquidation inlate June. Opus Groupo said its subsidiary, which is based in filed for reorganization in bankruptcy court onApril 22.