Levitt and Sons, LLC announced that the company and 37 of its subsidiaries filed voluntary petitions under Chapter 11 of the U.S. Bankruptcy Code. The Chapter 11 filings were made in the U.S. Bankruptcy Court for the Southern District of Florida in Fort Lauderdale.
A corporate news release says Levitt and Sons has taken this action "in response to unprecedented conditions in the homebuilding industry, which have severely impacted the company." It notes that this downturn has been particularly sudden and steep in Florida and in the Southeastern United States -- the markets in which Levitt and Sons operates.
As we reported a few weeks ago, work at the Seasons at Lake Lanier site - an active adult community going up at Browns Bridge Road and McEver Road on the west side of Gainesville - came to a halt last month after Levitt and Sons defaulted on about $2.5 million in interest payments owned five lenders.
Development of the 744-home subdivision for people 55-and-older began last year. A number of the homes that have been built so far are already occupied, others are vacant. Still others were in various stages of construction when work was halted.
In announcing the bankruptcy filing Friday, Levitt and Sons also announced that Lawrence E. Young of AP Services, LLC and a Managing Director at AlixPartners LLP, was named Chief Restructuring Officer, a new position, effective October 22. In this capacity he will oversee Levitt and Sons' Chapter 11 cases and related matters.
Young said, "We deeply regret the impact the Chapter 11 filing of Levitt and Sons will have on homeowners, vendors and employees. We remain mindful of Levitt and Sons' customers whose homes have not yet been completed. Through the Chapter 11 process, we seek a mechanism that will facilitate the completion of some unfinished homes. Likewise, we seek a resolution that will allow closings to take place promptly for previously completed homes. In the meantime, we will continue to make Levitt and Sons representatives available to answer customer questions and do what they can to provide assistance."
Young continued, "Our principal objective during the Chapter 11 process will be to identify the best means of maximizing recoveries for all creditor constituencies including our customers and employees. As part of this process, we will explore the potential sale of all or some of Levitt and Sons' assets."
In documents filed with the U.S. Bankruptcy Court Friday, Levitt and Sons noted that its business operations are concentrated in the homebuilding industry which is going through an unprecedented slowdown after years of strong growth driven in part by speculative activity by investors. Excess supply, particularly in previously strong markets like Florida, has led to downward pricing pressure for residential homes and improved and unimproved land.
Additional information about the Chapter 11 filing by Levitt and Sons is available on the company's website: www.LevittandSons.com. Customer information is also available at 877-538-4889. Vendor information is available at 888-538-4893.
http://accesswdun.com/article/2007/11/203873