Opus Northwest siblings file for bankruptcy
Portland Business Journal
Opus Corp. said Wednesday its Opus East and Opus West subsidiaries will file for bankruptcy, citing deteriorating conditions in the commercial real estate market.
The former will seek to liquidate under Chapter 7 of U.S. Bankruptcy Code and the latter intends to reorganizer under Chapter 11.
These bankruptcies come on the heels of the April 22 bankruptcy of Opus South Corp., an Opus affiliate based in Atlanta. Minneapolis-based Opus has said it plans to wind down its operations in that part of the country as well.
Just two of five Opus subsidiaries remain healthy, Opus Northwest LLC, which is an active developer in Portland, and Opus North LLC, which is based in Chicago.
Opus Northwest’s recent developments in Portland include the successful Bridgeport Village shopping center in Tualatin. At one point, Opus was the Portland Development Commission’s top choice to redevelop the Burnside Bridghead.
In recent years, the company has concentrated on residential projects.
It recently completed construction of two large apartment projects with a total construction budget of $150 million. Ladd Tower is a 332-unit project in downtown Portland and Park 19 is a 101-unit project in Northwest Portland.
"We have have a healthy balance sheet," said Brian Owendoff, vice president and manager for Opus Northwest's Portland operations.
Opus East, based in Rockville, Md., filed a petition to liquidate its portfolio under Chapter 7. In its filing in U.S. Bankruptcy Court for the District of Delaware, Opus East said it has between 200 and 999 creditors. It listed assets between $50 million and $100 million and liabilities between $100 million and $500 million. It did not identify creditors.
Opus West, based in Phoenix, anticipates filing a voluntary petition of Chapter 11 bankruptcy protection in early July.
“Declining real estate values and tight credit markets continue to impede the refinancing of assets and restructuring of lending agreements,” said Opus CEO Mark Rauenhorst in a statement.
“We regret that this action has proven to be necessary despite the efforts of so many. A court-supervised process and transfer of distressed assets will assist Opus in reorganizing and focus on the future.”
Opus East has developed more than 13.3 million square feet of space since 1994. Opus West has developed more than 52.7 million square feet since 1979.
The company said Opus North and Opus Northwest have been less affected by the recession, due to their mix of project types, healthy balance sheets and stronger markets.
Opus said its development activity has fallen to just 4.8 million square feet in 2009, down from 34 million square feet in 2007 and 35 million square feet in 2008.
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