Real Estate Bankruptcies in the 3rd Quarter 2017

In the third quarter of 2017 there were 454 real estate bankruptcies (i.e. bankruptcies where the primary asset was real estate). These bankruptcies include cases where the debtor indicated on the petition that the case’s Nature of Business was a Single Asset Real Estate as well as cases marked as Other or as Health Care where the company’s primary asset was real estate (such as a  nursing homes, hotels, etc.) The count was down from 614 in the second quarter and 581 in the same period in 2016.

We took a closer look at real estate bankruptcies where the debtor indicated that the estate had more than $1,000,000 in assets. For the third quarter, we found 132 larger cases (29% of the total). This is down from 164 in the second quarter and 214 for the same period in 2016.

The largest property categories for real estate bankruptcies in the third quarter were:

  1. Offices properties — 25
  2. Undeveloped Land – 23
  3. Single Family Residences- 17

Bankruptcies involving land are fairly commonplace since developing a property is risky and carrying a non-income producing can be costly.  The largest bankruptcy during the period was a land development in Hawaii valued at over $100 million.  What was interesting was the number of single family residences in bankruptcy.  Most of these appeared to be expensive homes that where the debtor was not occupying the property.

During the period there was also one senior housing facility/nursing home , one hospital, and one church.

California (22) and New York (16) were the most active states by far.

Among the more interesting real estate bankruptcies that were filed in the third quarter include:

If you are looking for opportunities in bankruptcy, contact us.  We can help.

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