Hill Country Galleria, L.P., announced today that it has filed a petition for voluntary reorganization under Chapter 11 of the U.S. Bankruptcy Code in order to facilitate restructuring of a construction loan that has expired. Hill Country Galleria tenants’ occupancy is not affected by the filing and all Galleria businesses can continue to operate.

 

Hill Country Galleria is more than one million-square-foot mixed-use project anchored by Dillard’s, Cinemark Theater, Barnes & Noble and Dick’s Sporting Goods. The retail portion of the project was developed at a cost of over $192 million. The overall project also includes 309 luxury apartment units and the Bee Cave, Texas, City Hall, although those portions and certain of the retail outparcels are separately owned and are not included in the bankruptcy case.

 

John Greer, executive vice president, Opus West Corporation, said extraordinarily difficult credit market conditions compounded by the complexity of refinancing a single construction loan held by a consortium of 10 banks made it necessary to seek bankruptcy protection for the project. “With the protections afforded by bankruptcy law, we hope to complete a successful restructuring of the project’s debt on terms that will allow us to optimize value for the project’s lenders and other creditors,” said Greer. “This is a successful development project that is more than 70 percent leased and negotiations have been ongoing with a number of retailers and office users that would further solidify the tenant base.” Companies affiliated with Opus West co-developed and manage the project with several other local development partners.

 

Opus West Corporation is a full-service design-build development firm serving the southwestern portion of the United States. Headquartered in Phoenix, Opus West Corporation is one of five independent operating companies that make up the Opus Group. With in-house expertise in office, industrial, retail, multifamily, government and institutional projects, Opus West and its subsidiaries have developed more than 52.7 million square feet of space since starting operations in 1979.