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Village Homes of Colorado - Colorado home builder

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2008-11-08

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stories: rockymountainnews.com

From the Rocky Mountain News comes the announcement that Village Homes of Colorado (website: villagehomes.com), ranked 118 on the 2007 builderonline.com top 200 list, has filed for Chapter 11 bankruptcy protection:

The 24-year-old company blames the credit crisis and the depressed housing market for its filing for reorganization under Chapter 11.

"There is no question about it," said Garry R. Appel, the attorney for the company, which has built more than 10,000 homes in Colorado since it was founded by John Osborn in 1984. "It is the credit crunch and the downturn in the housing market, which has created this enormous problem for homeowners and home builders across the country.

Further to the article, the bankruptcy filing cites assets and liabilities both in excess of $100 million, and specifically points to "inappropriate actions" by lenders. However, we see per their bankruptcy filing that their revenues have plummeted from $219 million in 2006 to $184 million in 2007 to only $85 million through October 31, 2008.

Some of the larger "bagholders" appear to be GMAC Residential Capital (GMAC LLC) and Guaranty Bank (Guaranty Financial Group), the latter of which is cited as having a secured claims of some $86 million (GMAC ResCap has multiple secured loans totalling some $36 million).

Village Homes of Colorado closed on 412 homes in 2007. Per the Rocky Mountain News, they only expect to close on "about 220 to 225" in 2008.

We have not been able to determine how many employees this bankruptcy will affect.

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Comments:

Pooge at 16:30 2008-11-07 said:
New kaboom:

http://www.rockymountainnews.com/news/2008/nov/07/village-homes-files-bankruptcy/ http://www.denverpost.com/business/ci_10926794 Builder 118 on the 2007 Builder Magazine list. Permalink

Elvis Pushback at 14:31 2008-11-19 said:
and another one bites...another one bites...another one bites the dust. Permalink

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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.