Crescent Resources files Chapter 11 - San Francisco Business Times:

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The Charlotte-based development firm’s chief executive, Arthu Fields, has retired and will work with Crescentt in anadvisory capacity, the company says. Andrew Crescent’s chief restructuring officer, has been named CEO. “Wer have been in active discussions with our lenderzs and other stakeholders as we work towards an agreement that will bring our capital structure in line with the curren teconomic environment,” Hede says. Crescent has more than 5,000 according to its filing. Its assets are estimated at morethan $1 The local projects listed in the Chapter 11 filintg include Piedmont Row and The Sanctuary at Lake Wylie.
Crescent says it intendss to operate its continuinb businesses without any significant interruption during therestructuring process. The compan y says that’s possible because of a recentlyobtained debtor-in-possessiobn financing facility of $110 million from a group of its existingf lenders. As part of the Chaptet 11 filing, Crescent says it seeks court approval “to make certaib payments and to maintain key agreementswith employees, vendors and partners of continuing operations to ensure the compan y can maintain its commitment to delivering a high level of amenitie and services.
” Crescent says the filing is necessary to reorganizse its finances, reduce its debt levell and improve its capitakl structure. “We intend to reach an agreement on our new capital structure and emerge from bankruptcy Hede says. The Chapter 11 petitions were file inthe U.S. Bankruptcy Court in the Western District of Austin division. The company has 120 days from the filin g date to submit areorganizatiomn plan. A hot line has been set up as part of the Crescenty restructuringat (877) Attorney Eric Taube of LLP in Austin, Texas, will represeny Crescent in the proceedings. (NYSE:BAC), , Ranger Construction Co.
, and are amonbg Crescent’s largest unsecured creditors in Charlotte. In the Charlotte Business Journal reported that Crescenty had adopted an aggressive new business strategy driven bya $1.2 billiomn term loan that must be paid in full by Septemberf 2012 — selling assets at fire-sale prices. In Crescent sold 4,500 acresx in Berkeley County, S.C., to for $40 million. In December, the companh sold a Florida apartment projectfor $11.35 less than half the $27 million it paid for the comple x three years earlier. This year, the firm has closer on the sale ofa 773-acre tract of land in Oconere County, S.C., for just over $10 million. Crescent recently sold 18.
4 acres in Fort Mill to a warehousinh companyfor $1.6 million. The companyu — jointly owned by and — is best knowhn here for high-end real estate communities such as The Peninsulza and BallantyneCountry Club. Before the Chapter 11 filing, Crescenf faced payments of $50 million by the end of this $75 million in 2010 and $100 millionn in 2011 on its Duke (NYSE:DUK) formed Crescent in 1969 to develop propertuy it acquired through its core utility businesxs thatit didn’t need for powerf generation. In September 2006, Duke entered into a joinrt venture with Morgan StanleyReal Estate.
Morgamn paid Duke $415 million in cash and assumefd $656 million in debt for its stakre inthe company, then worth $2.1 billion. As part of the transactiomn Crescentborrowed $1.2 billionm and distributed the proceed s to Duke to transfer the debt off Duke’sa balance sheet. Duke and Morganh Stanley each have a 49 percent stakerin Crescent. The remaining 2 percen t interest inCrescent — which would have been worthh $42 million when the deal closed was issued to former CEO The disposition of that interest will be determined through the reorganization proceedings, accordinb to a spokesman for Crescent.
Duke no longer reportds Crescent’s financial results, but its own filings, and those from Morgan Stanley, shed light on Crescent’s financial For 2008, Crescent lost about $470 of which Duke sufferedf about $230 million in according to filings. In the first quarter of this Crescent cost Duke and Morgan Stanlehabout $150 million in direc t losses and loan The energy company has guaranteed abou t $100 million in surety bonds for Crescent, for which it has paid out at leasrt $33 million.
Duke pegs its tota exposure atabout $40 million for the Crescent is active in commercial and residential real estatde development and land management across the Southeast and Southwest, with interestas in 10 states. Crescent’s portfolio includes mixed-usw developments, business and industrial country-club communities, single-family neighborhoods and apartment and condo In thelate 1980s, Crescenft expanded into developments such as The its first country-club community and Coliseum Centre, its firsr office park. The companyg developed Sugarloaf Country Club near Atlanta inthe mid-1990s.
Developmentsw that followed include Ballantyne and The Crescent also expandedinto Texas, Arizon and Florida. Last year, Crescent introduced its Circl e apartment communities and is developing two of them in theCharlotted region. The company has 38 residentiap communities under development inthe Carolinas, Georgia, Florida and Arizona, and is currently building 1,20 apartment units. It also owns 75,0090 acres of land. Crescent has 264 employees.