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2008-10-31

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stories: indystar.com

Lafayette, Indiana-based homebuilder Gunstra Builders (website: gunstrabuilders.com), a company founded in 1976 by Bruce Gunstra, appears to be in dire straits. We first received tips that Gunstra might be "shutting down" on October 15th. We posted this rumor on our forums requesting confirmation. Soon, at least three forum members posted that they had heard Gunstra was either going bankrupt or that their "doors were closed". Per one post:

I manage a property for someone that built a Gunstra condo in Plainfield. They let me know a few days ago that Gunstra is bankrupt and has shut it's doors. I called the main office # I have for them, it is "temporarily disconnected" Their main office is about 5 minutes from my house, I am going to stop by tomorrow and see.

Another Gunstra homeowner on our forums heard similar news that Gunstra was "going bankrupt". On October 30th, IndyStar reported that Gunstra has shut down their sales offices and disconnected certain phone lines:

Lafayette-based Gunstra hasn't commented publicly on its viability. Calls to its main office went unanswered Tuesday and Wednesday.

Phones are disconnected to at least seven Gunstra communities where the company is building homes in Indianapolis, Carmel, Fishers, Plainfield and Zionsville.

With such bad news piling up, unanswered phone calls and spreading speculation of shutdown and/or bankruptcy, we can only wonder if Gunstra is only a short breath away from implosion. Gunstra Builders had some 60 - 76 employees and was involved in a number of single family home and townhome projects. If anyone can provide additional data as to their ongoing status or their peak size (i.e. approximate closings per year at peak), please comment below or email us.

Stay tuned.

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Comments:

Justin at 05:53 2008-10-15 said:
Word from a tipster is that they are "shutting down":

Gunstra Builders

http://www.gunstrabuilders.com/neighborhood/indianapolis/default.asp

Anyone know anything about this builder? Trying to determine their size and corroborate the tip. Permalink

Justin at 22:58 2008-10-17 said:
Another tipster informed us that Gunstra has (had?) 75 employees or so. and that he/she thought they were done "awhile back". Permalink
chbartel at 03:38 2008-10-23 said:
Another tipster informed us that Gunstra has (had?) 75 employees or so. and that he/she thought they were done "awhile back".

I manage a property for someone that built a Gunstra condo in Plainfield. They let me know a few days ago that Gunstra is bankrupt and has shut it's doors. I called the main office # I have for them, it is "temporarily disconnected" Their main office is about 5 minutes from my house, I am going to stop by tomorrow and see.

They have been around Indianapolis for probably 20-25 years.

Their biggest issue was they had no clue how to market, and with the downturn it killed them. I went to them several times over the past few years letting them know I work with investors on home purchases in Indianapolis(probably sell 50 a year to investors). They never got back with me, so I went back to Beazer who always will work with me and get me good pricing for investors.. Permalink

AnimalMother at 17:16 2008-10-23 said:
I own a new Gunstra home here in West Lafayette, IN. I have definitely heard they are going bankrupt. I have spoken with some of their staff and they mentioned going from approx 60 employees down to about 14. I think it is even less now as I have heard of some of the employees moving to some of the related companies that Gunstra owns/started. The houses that are under construction have mechanic's liens on them - one was sent to me by mistake. We have spoken with contractors going around the neighborhoods getting addresses so they can file liens with the county.

Gunstra did shut their Indy operations and moved everything to Lafayette, IN. It is unfortunate to say, but Bruce Gunstra and his management had a bad attitude over the last year, so I'm not surprised they saw the writing on the wall. I'm sure at this point they are going to try to protect their assets by moving crap around to all of their other operations. They own a title company, several homeowner's associations, property management, etc. They were basically milking every angle they could which probably resulted in their failure. That and their overall poor attitude and complete lack of customer service.

The Dude Permalink

Hey Jude at 16:28 2008-10-27 said:
[size=18:ae71d40480][/size:ae71d40480] I live in the Gunstra condo community in Plainfield, Blackthorne. Our current HOA called a meeting last Monday, the 20th. The two women who showed up were former Gunstra employees and "said" they are taking over the HOA. They said Gunstra's doors were closed and he is shut down. They are telling us that we, homeowners, are being asssessed an additional $91.00 besides the $125 that we already pay. I don't know by what authority these women are collecting this money if there former boss has closed. I am concerned that they are still working for Gunstra. DOES ANYONE KNOW IF HE HAS FILED BANKRUPTCY? I can't find out anything from the insurance company who insures our buildings because "I don't have the authority." I don't want to pay for units which are not occupied and some were even "rented." by Gunstra. One is that I know of and is not paying. We didn't get an accounting of the yearly budget or a shortfall amount or the names of the contractors with whom there are contracts, their terms or obligation. We were given monthly averages of our debts and told our water would be shut off and our building and grounds insurance wouldn't be paid unless we paid the assessment and our water bill. The bank who has the mortgage can't assume responsibility until Gunstra files bankruptcy, I understand. HELP ANYONE! Permalink
AnimalMother at 16:34 2008-10-27 said:
was one of them Lori Crampton? What about Tracy Shepherd? Lori does/did sales and Tracy does/did warranty work.

Are they allowed to raise the HOA dues like that? What documentation do you have that might state otherwise? Plenty of people in our neighborhood didn't pay HOA dues this year because the HOA doesn't do anything except pay the electricity on the street lights (weeds in common areas, grass doesn't get cut, etc). I heard that Gunstra owns the management company, I think it is called "Management Advantage" or something like that.

I would be wary. I heard out of 14 units down where you live, something like 11 were in foreclosure.... Just upping the dues arbitrarily doesn't make sense. The ones that are rented should be paid by Gunstra.

The Dude Permalink

Pooge at 12:46 2008-10-30 said:
Article on Gunstra:

http://www.indystar.com/apps/pbcs.dll/article?AID=/20081030/BUSINESS/810300360 Permalink

abides at 23:52 2008-10-30 said:
We live in the lake houses in Keystone (Crystal Lake).

They built a spec house across the street and the other day they came in and put the model furniture in the spec house. Was wondering what was going on at the time. Then they had a note on one of their gazillion signs "model furniture sale!".

Glad to see them go. But I don't know who is going to build the remaining houses in our addition.

About 6 months ago they transferred the home owners management to some company in FL. WHY we would use a management company in FL is BEYOND ME. Now it is going to get very interesting because Gunstra had 10 votes for every empty lot in the place before we could take over the homeowners association. Uggg. What a mess....

I can hear the value being sucked out of my home as I type. Permalink

abides at 23:57 2008-10-30 said:
Argggg... Permalink
AnimalMother at 00:26 2008-10-31 said:
abides, be thankful the property in Indiana isn't very expensive so hopefully you won't have too much to lose.

Who knows what will happen - we are also disappointed because we have a quaint neighborhood here in West Lafayette and Gunstra pissed it away and really screwed up the potential here. I am hopeful for the next couple of years to level out, at least we have Purdue and other strong organizations up here keeping some value in our property.

The Dude Permalink

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Important: Ailing Builders haven't shut down, but they've suffered significant valuation declines, temporarily halted redemptions, or faced other major business hurdles. Builders on watch may not even have unusual declines relative to peers, but may be posted if it is felt there may be risk of developing a more serious condition in the near future.