Editor's Note: This item is republished with permission from Las Vegas Review-Journal. View the original article here.

Las Vegas-based American West Development became the latest victim of the real estate slump Thursday when it filed for Chapter 11 bankruptcy protection.

But unlike several others, American West launched what is called a prepackaged bankruptcy, where it reached agreement with all of its bank lenders ahead of time on how to restructure its heavy debt. Typically, this can shave months or even years from court time compared to a case filed without first cutting a deal.

Terms were not disclosed.

"(T)his reorganization will allow us to move forward with existing and new projects, protect our current employees and provide for our homeowners," American West President Robert Evans said in a statement.

Evans was named president late last year, replacing company founder Larry Canarelli. Canarelli family trusts still own the company, although owners commonly surrender at least some equity in return for easing debt.

The company lists 71 people on its payroll.

In court documents, the company listed $177.5 million owed to seven banks holding collateral valued at only $49.6 million. In addition, American West owes another $30.2 million to outsiders without collateral pledges, most of it insurance bonds.

The company also included a long list of home warranty complaints and litigation with no dollar amounts attached. However, wrote Evans, "(T)he majority of the litigation is covered by insurance and was not a major factor in the decision to file."

The company, started in 1984, has built 71 communities with more than 15,000 homes, including Coronado Ranch, Silverado Ranch and Highlands Ranch. Along with Harmony Homes and Rhodes Homes, it had ranked among the largest locally based builders in a market dominated by developers with multistate operations.

In 2009, Rhodes filed its own Chapter 11 that resulted in lenders taking over its operations.

New-home sales in the region have plunged almost 90 percent since 2006 to just 3,894 last year, according to Home Builders Research Inc.

American West felt the pain, with sales plunging from 767 in 2005 to just 92 three years later. In contrast with the rest of the market, it experienced a rebound to 248 in 2010, before dropping to 165 last year.

Contact reporter Tim O'Reiley at toreiley@reviewjournal.com or 702-387-5290.

Annual new home sales for American West Development and all of Las Vegas


Las Vegas

American West
total (local rank)



165 (9)



248 (11)



146 (10)



92 (23)



216 (24)



509 (17)



767 (9)

Source: Home Builders Research Inc.

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