Crescent Resources files Chapter 11 - Pacific Business News (Honolulu):

ycoguqi.wordpress.com
The Charlotte-based development firm’s chietf executive, Arthur Fields, has retirecd and will work with Crescent in an advisory thecompany says. Andrew Hede, Crescent’es chief restructuring officer, has been named CEO. “We have been in activde discussions with our lenders and othetr stakeholders as we work towards an agreemenf that will bring our capital structure in line with the currentteconomic environment,” Hede says. Crescent has more than 5,00p0 creditors, according to its filing. Its assetsd are estimated at morethan $1 billion. The local projectse listed in the Chapter 11 filing include Piedmont Row and The Sanctuaryh atLake Wylie.
Crescent says it intends to operate its continuingv businesses without any significant interruptioh during therestructuring process. The company says that’s possible becausde of a recentlyobtained debtor-in-possessionn financing facility of $110 millioh from a group of its existing lenders. As part of the Chapter 11 filing, Crescent says it seeks court approvakl “to make certain payments and to maintaimn key agreementswith customers, vendors and partners of continuinyg operations to ensure the company can maintain its commitmentr to delivering a high level of amenitiews and services.
” Crescent says the filing is necessarh to reorganize its finances, reduce its debt level and improve its capital structure. “We intend to reach an agreement on our new capitaol structure and emerge frombankruptcy quickly,” Hede says. The Chaptee 11 petitions were filed inthe U.S. Bankruptcy Courgt in the Western Districtof Texas, Austin division. The companyh has 120 days from the filing date to submir areorganization plan. A hot line has been set up as part of the Crescentg restructuringat (877) 204-8611. Attorney Eric Taube of LLP in Austin, will represent Crescent in the proceedings. , Ranger Construction Co.
, and are among Crescent’s largesgt unsecured creditorsin Charlotte. In the Charlotte Business Journal reported that Cresceng had adopted an aggressive new businesds strategy driven bya $1.2 billion term loan that must be paid in full by Septembed 2012 — selling assets at fire-sale prices. In October, Crescent sold 4,500 acres in Berkeleu County, S.C., to for $40 million. In December, the company sold a Florida apartment projectfor $11.35 less than half the $27 million it paid for the complex thre years earlier. This the firm has closed on the sale ofa 773-acrde tract of land in Oconese County, S.C., for just over $10 million. Crescent recently sold 18.
4 acreas in Fort Mill to a warehousing companyfor $1.6 The company — jointly owned by and is best known here for high-end real estate communities such as The Peninsulaz and Ballantyne Country Club. Before the Chapte r 11 filing, Crescent faced payments of $50 million by the end of this $75 million in 2010 and $100 million in 2011 on its Duke (NYSE:DUK) formed Crescent in 1969 to develol property it acquired through its core utility business thatit didn’ t need for power generation. In Septembe 2006, Duke entered into a joint venture with Morgan StanleReal Estate. Morgan paid Duke $415 million in cash and assumec $656 million in debt for its stake in the thenworth $2.
1 billion. As part of the transaction Crescentborrowee $1.2 billion and distributed the proceedw to Duke to transfer the debt off Duke’d balance sheet. Duke and Morgan Stanley each have a 49 percent stakeein Crescent. The remaining 2 percent interestr inCrescent — which would have been worth $42 millionb when the deal closesd ­— was issued to former CEO The disposition of that interest will be determined through the reorganization according to a spokesman for Crescent.
Duke no longerr reports Crescent’s financial results, but its own filings, and thosd from Morgan Stanley, shed light on Crescent’s financial For 2008, Crescent lost about $470 of which Duke suffered about $230 million in according to filings. In the first quarter of this Crescent cost Duke and Morgan Stanleyabourt $150 million in direct losses and loan guarantees. The energ company has guaranteedabout $100 milliojn in surety bonds for Crescent, for whicn it has paid out at least $33 Duke pegs its total exposure at about $40 milliom for the year.
Crescent is actives in commercial and residential real estatse development and land management across the Southeasrtand Southwest, with interests in 10 states. Crescent’zs portfolio includes mixed-use developments, business and industrial country-club communities, single-family neighborhoodsw and apartment andcondo complexes. In the late 1980s, Crescenf expanded into developments such as The itsfirst country-club community and Coliseum Centre, its first officed park. The company developed Sugarloaf Country Club near Atlantwa inthe mid-1990s. Developments that followed include Ballantynr andThe Sanctuary. Crescent also expanded into Arizonaand Florida.
Last year, Crescent introduced its Circle apartment communitiesz and is developing two of them in theCharlotte region. The companu has 38 residential communities under development inthe Carolinas, Georgia, Texas, Florida and and is currently building 1,200 apartmen t units. It also owns 75,000 acres of land. Crescenrt has 264 employees.