One of Arizona's largest private builders, Fulton Homes filed for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court for the District of Arizona Jan. 27. According to the filing, Fulton owed between $100 million and $500 million to over 100 creditors. A creditor list had yet to be filed.
The company stated in bankruptcy documents that funds will be available to pay unsecured creditors. Fulton has hired Shughart Thomson & Kilroy, P.C. to represent the company during the reorganization.
Fulton Homes has been in operation for more than 30 years and currently has 21 communities in the Arizona market. Residential real estate activity in the state has been struggling, with new-home sales overshadowed by foreclosures. According to Trulia.com, 17,593 homes recently sold and there are 17,733 foreclosures on the market.
Fulton Homes' CEO Doug Fulton told Big Builder last month that the company was in the process of unveiling an aggressive strategy to deal with foreclosure competition while also bringing in new business.
Radio commercials were aired locally, cautioning buyers of the pitfalls they can encounter when purchasing a foreclosure and directing them to an online tool that details why a new-home purchase is a better move financially.
The builder further promised that if after a buyer looks at a Fulton Home and still wants to purchase a foreclosure, its sales staff will help them with the process.
Calls to Fulton were not immediately returned, and no statistics were available regarding the success rate of the company's marketing efforts to abate pressure from foreclosures.