The American Bankruptcy Institute (“ABI”), in partnership with Epiq Systems, Inc., has recently reported that commercial Chapter 11 filings for 2017 increased 6% over those filings for 2016. Commercial bankruptcy filings under all chapters of the Bankruptcy Code also increased by a more modest .25%. Even more striking is the Chapter 11 filing total for the month of December, 2017, which represents a 107% increases over those filings during the same month of 2016.
While the ABI’s statistical report does not comment upon the causes for the commercial filing increases, Sands Anderson’s bankruptcy team has likewise noted an increase in commercially related inquires seeking bankruptcy or workout assistance and advice. Burdensome real estate debt has been a frequent motivator for these contacts. During January 2018, Sands Anderson has filed a Chapter 11 case for an LLC owning improved real estate leased to a related private school. The goal of that filing is to stay a pending foreclosure while a refinance is pursued.
Roy M. Terry is a member of Sands Anderson’s Bankruptcy & Creditors’ Rights team. If you have questions regarding this blog post or any Bankruptcy & Creditor’s Rights matters, he can be reached at RTerry@SandsAnderson.com.