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Fulton Homes - AZ-based residential

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2009-01-28

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stories: azcentral.com

35-year old Fulton Homes, founded by businessman and philanthropist Ira Fulton, has had to file for Chapter 11 protection.

Court documents show that Fulton Homes owes $100 million to $500 million to more than 100 individual creditors, including lead creditor Bank of America.

The company's estimated assets are listed as $100 million to $500 million, the documents show.

The company is scheduled to have its court-mandated meeting with creditors on March 3.

As for volume:

Fulton, like many Valley home builders, had a backlog of speculatively built homes from 2005 to '07. It has been aggressively trying to sell those homes and get contracts on new ones by lowering prices, market watchers say. But the builder had started few new homes recently.

Fulton took out 61 single-family permits to build new Valley homes last year, said RL Brown, a housing-market analyst.

The builder reported 428 closings or sales, so the numbers suggest that most of those sales came from Fulton's speculative inventory, built in past years.

Obviously, things have slowed down to the present day -- so the builder likely had significantly more than 428 closings per year at peak.

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Important: This company is on our list of builder operations that have "imploded" (see also ailing lenders). This is a somewhat subjective call, and does not necessarily mean total shutdown or bankruptcy. It can also mean steep and rapid declines in enterprise value; or abnormal "bail-out" by corporate parents or peers in order to continue to operate. The builders may be residential or commercial.