Opus South Files Chapter 11 BK
April 23, 2009
The South division of Opus Corp. filed Chapter 11 bankruptcy today. According to the press release,
Anne Marie Solberg, chief restructuring officer of Opus South, said the bankruptcy filings were made necessary by the continued deterioration in economic conditions in the commercial and residential real estate markets in the Southeast. “While we began slowing the pace of new development nearly two years ago in anticipation of difficult market conditions, we must now take additional measures to enable an orderly wind down of our portfolio, protect asset values and maximize returns on lenders’ investments,” said Solberg. She said Opus South will currently maintain operations in Atlanta and Tampa to work on asset dispositions and transitions.
Chief restructuring officer huh? That’s a new one. It would certainly help spot distress if companies started listing the CRO alongside the CEO on web sites and marketing collateral. Anyhow, the company had outstanding debt that it couldn’t refinance and was essentially forced into bankruptcy. We’ve seen this with GGP already, and there will be many, many more of these cases so long as debt markets are frozen, rents are falling, and vacancy increasing.
Another division of Opus Corp is Opus West, who is a fairly active developer in the Bay Area. Locally, they are known for developing projects such as:
- Fremont Tech Center in Fremont (industrial condos not selling well at all)
- Opus Sierra Point, Brisbane
- 225 W Santa Clara St, San Jose (sold to EOP)
In addition, Opus West has been active in highly speculative markets such as Phoenix and Sacramento, and has other projects in Texas, Portland, and Seattle.
If I were a betting man, I’d be concerned about the health of Opus West as well.
Similar Posts:
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- Opus West Finishing Up Sierra Point in Brisbane
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Tags: Bankruptcy, Chapter 11, Developers, Opus, Opus South, Opus West
I don’t know what possessed them to build Fremont Tech Center. There was a recent sale at the project for some units. I think that was a total of about 14,000 square feet.
That project is toast. Who in there right mind is going to pay $200 a square feet for space when you can lease a comparable building in Fremont for around 60 or 70 cents?
In Livermore, industrial condos listed for $300+/ft, are now going to an on-line auction. Minimum bids around $150/ft. Clients I showed these to just laughed at the price. Another client I suggested auction to awhile ago to lighten the load would hear nothing of it.