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and some of its subsidiariee filed voluntary petitions late Monday for reorganization undedChapter 11. Chapter 11 generally removeas the threat of lawsuits from creditors while a businesds seeks to rehabilitate itselt andcontinue operations. Opus West and its affiliate s reportedabout $1.28 billion in totalo assets and $1.46 billion in total liabilities, accordinv to bankruptcy court filings. The corporation and its affiliatess had combined revenue ofaboutr $405 million in 2008. The parent companyt lists 200 to 999 according tobankruptcy filings. Opus West Corp.
owns about 20 real estatr development properties either directly or through entities set up to holdthe properties, the courty filings say. The total debt on those properties isabouy $414 million and the value of the propertiesx is about $403 In addition to Opus West the subsidiaries that have filed Chapter 11 petitions are Opus West Constructiojn Corp., Opus West LP, Opus West Partners Inc. and O.W. Commerciall Inc. Opus West Corp. has guaranteedc about $1.15 billion in loans for its subsidiariesx andjoint ventures, and most of thos loans are in default, the court filings say.
Steep declines in commercial real estate values and difficulft credit market conditions necessitatefdthe filing, said John Greer, chief restructuring officer of Opus West. Greer said Opus West will keepa "modest in Phoenix, Texas and California to work on asseyt dispositions and transitions. "Whil we began slowing the pace of new development nearly two years ago in anticipatiob of difficultmarket conditions, we must now take additionakl measures to enable an orderlg wind-down of our portfolio, protect asse t values and maximize return on lenders' Greer said in a preparer statement.
Opus West and its subsidiaries have sufferedc declining financial performancesince 2008, resulting in defaults on certain creditt lines and constrained liquidity, according to an affidavity filed by Greer, managing member of New York-based Phoenixd Capital Partners, which is the chief restructurinhg officer of Opus West Corp. Greer is also president of the Opus West Opus West Partnersand O.W. Commercial subsidiaries. Opus has focused on recapitalizingf through project salesand refinancing, but has been unable to do so becauser of poor market Greer's affidavit says.
Since 1979, Opus West and its affiliatez have developed more than 52 million squarre feetof office, industrial, retail, government and institutional projects, the affidavitr says. The company's assets include interests in commercial and residential real estate projectzsacross California, Arizona and Texas, including office, industrial, apartment and retail projects in various stages of development, the affidavi says. Addison-based Opus West LP, formed to developo real estate propertiesin Texas, owns seven properties that consisrt of either vacant land, or a projecyt under construction or completed projects.
The total debt on thosd properties isabout $105 million and theirr value is about $134 Greer's filing states. Opus has been dramaticallyg scaling back its North Texas operations for more than a Opus spokeswoman Winston Hewetgt told the that the Addison office has not started a new developmen in more than a year and has cut its staff in Dallaws to 12 employees from abouty 40 ayear ago. Opus West's overalo headcount had dropped to 40 as ofJuly 1, compared to 291 two yearsx ago, Hewett said.
Since April, dozens of subcontractors have filedc liens totaling morethan $4 million against Opus West and Opus West Construction tied to Two Addison a $23 million, 198,000-square-foot speculative office building in The building was developed and is owned by Opus West The liens claim Opus owes the subcontractors for labot or materials provided in the coursed of construction. The six-story Two Addison buildingv on the west side of the Dallas Nortj Tollway just north of Arapaho Road wasrecently completed, but has no tenants.
The credit crunch and slowintg demand for office space left Opus unable to get permanenty financing to replacethe short-term construction loan on the Addisonn project, Hewett said. Other Opus West Corp. projects in Nortn Texas include 121Lakepointe Crossing, an office and industriak development in Lewisville; and Broadstone Parkway, a 5.8-acrw mixed-use project at 5005 Galleria Drive in Norty Dallas. Dallas area creditors include RL Murphety CommercialRoof Systems, owed $1.24 million; Greenn Fire Systems of Texas, owed and Ennis Steel Industries Inc., owed and Tas Commercial Concrete Construction, owed according to court records.
Opus' troubles stem from the globa leconomic downturn, deterioration of the real estat market and the credit crunch, whichg has made it difficult for borrowers to get financin g to fund real estate projects or refinancee existing projects, Greer's affidavit states. The turmoil has scareds buyers, leading to excess supply and lowert prices. The dramatic downturn has caused Opus to be out of compliancde with terms of various loans and unabled torestructure them, and attempts to raisew capital and sell assetxs have proven difficult, bringing about the Chapter 11 Greer's affidavit says.
Opus' challenges vary considerablg by region, said Mark chairman and CEO ofOpus "Opus West faced particularly dramatic drops in real estats values in markets such as California and and has been particularlyh challenged by the sharp downturn in the capitall markets and availability of refinancing," he Rauenhorst said that two other independenf operating companies of Opus Group -- and Opus Northwesy LLC -- have been less affected by the economid and capital market conditionsa because of their mix of project types and theif location in stronger markets. , which is based in Minn.
, is a design-build developmen t firm that specializesin office, industrial, retail, government and institutional projects. It also controls Washington-base LLC, which filed for Chaptere 7 liquidation inlate June. Opus Group said its subsidiary, whicjh is based in filed for reorganization in bankruptcy court onApril 22.
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