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

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and some of its subsidiaries filed voluntar petitions late Monday for reorganization underChapter 11. Chapter 11 generally removes the threatf of lawsuits from creditors while a business seeks to rehabilitatde itself andcontinue operations. Opus West and its affiliates reportedabout $1.28 billion in total assets and $1.46 billion in total liabilities, according to bankruptcyh court filings. The corporation and its affiliates had combined revenue ofabout $405 million in 2008. The paren company lists 200 to 999 according tobankruptcy filings. Opus West Corp.
owns aboug 20 real estate development properties either directly or througb entities set up to holdthe properties, the courty filings say. The total debt on those properties isabout $414 million and the value of the propertiesx is about $403 million. In addition to Opus West the subsidiaries that have filed Chaptert 11 petitions are Opus West Construction OpusWest LP, Opus West Partners Inc. and O.W. Commerciap Inc. Opus West Corp. has guaranteed abouy $1.15 billion in loans for its subsidiaries andjoint ventures, and most of thoss loans are in default, the court filings say.
Steelp declines in commercial real estate values and difficulyt credit market conditions necessitatedfthe filing, said John Greer, chief restructuring officer of Opus West. Greer said Opus West will keepa "modesr presence" in Phoenix, Texas and Californiaz to work on asset dispositions and "While we began slowing the pace of new developmen t nearly two years ago in anticipation of difficult market conditions, we must now take additionalo measures to enable an orderly wind-dowjn of our portfolio, protect asset values and maximizer return on lenders' investment," Greer said in a preparefd statement.
Opus West and its subsidiaries have suffered declining financial performancesince 2008, resulting in defaults on certainn credit lines and constrained liquidity, according to an affidavit filed by Greer, managing membedr of New York-based Phoenix Capital which is the chief restructurintg officer of Opus West Corp. Gree r is also president of the Opus West Opus West Partnersand O.W. Commercial subsidiaries. Opus has focused on recapitalizing through projecty salesand refinancing, but has been unable to do so becausee of poor market Greer's affidavit says.
Sincde 1979, Opus West and its affiliatew have developed more than 52 million square feetof industrial, retail, multifamily, government and institutional projects, the affidavit The company's assets include interests in commerciap and residential real estate projectes across California, Arizona and Texas, including condominium, industrial, apartment and retail projects in various stage s of development, the affidavit says. Addison-based Opus West LP, formeed to develop real estate propertiesin Texas, owns seven propertiexs that consist of either vacany land, or a project undefr construction or completed projects.
The total debt on those propertied isabout $105 million and theifr value is about $134 million, Greer'e filing states. Opus has been dramatically scaling back its Nortyh Texas operations for more thana year. Opus spokeswoman Winston Hewett told the that the Addisom office has not started a new developmenyt in more than a year and has cut its staff in Dallaws to 12 employees from abourt 40 ayear ago. Opus West's overalll headcount had dropped to 40 as ofJuly 1, comparef to 291 two years ago, Hewetg said. Since April, dozens of subcontractor s have filed liens totaling morethan $4 million againsf Opus West Corp.
and Opus West Constructionh tied to TwoAddison Circle, a $23 198,000-square-foot speculative office building in The building was developed and is owned by Opus West The liens claim Opus owes the subcontractorsa for labor or materials provided in the course of The six-story Two Addison building on the west side of the Dallas North Tollway just north of Arapahi Road was recently completed, but has no The credit crunch and slowing demanf for office space left Opus unable to get permanent financiny to replace the short-term construction loan on the Addison project, Hewettg said. Other Opus West Corp.
projects in Nortjh Texas include 121 Lakepointe an office and industrial developmentin Lewisville; and Broadston e Parkway, a 5.8-acre mixed-use project at 5005 Gallerias Drive in North Dallas. Dallas area creditors includes RL Murphey Commercial Roof owed $1.24 million; Green Fire Systems of owed $856,660; and Ennis Steeol Industries Inc., owed and Tas Commercial Concrete owed $500,704, according to court Opus' troubles stem from the global economifc downturn, deterioration of the real estate marke and the credit crunch, whicuh has made it difficult for borrowers to get financinvg to fund real estatre projects or refinance existing projects, Greer's affidavit states.
The turmoil has scared buyers, leadinhg to excess supply andlower prices. The dramatic downturnh has caused Opus to be out of compliancs with terms of various loans and unablse torestructure them, and attempts to raise capital and sell assets have proven difficult, bringing about the Chapter 11 Greer's affidavit says. Opus' challenges vary considerably by region, said Mark chairman and CEO ofOpus "Opus West faced particularlt dramatic drops in real estate values in marketss such as California and Arizona, and has been particularly challenged by the sharpp downturn in the capital markets and availabilit y of refinancing," he said.
Rauenhorst said that two other independengt operating companies of OpusGroup -- and Opus Northwest LLC -- have been less affected by the economicf and capital market conditions becausw of their mix of project types and their location in strongetr markets. , which is based in Minnetonka, Minn., is a design-buildc development firm that specializesin industrial, retail, multifamily, government and institutional It also controls Washington-based LLC, which filexd for Chapter 7 liquidation in late Opus Group said its subsidiary, whicu is based in Atlanta, filed for reorganization in bankruptcy courgt on April 22.