LA Real Estate Company Files for Chapter 11 Bankruptcy Protection

One of the largest landowners in downtown Los Angeles, Meruelo Maddux Properties, Inc. has filed for Chapter 11 bankruptcy protection.

The company cited significant, recurring cash shortfalls because of a challenging credit climate and a difficult real estate market as what led to its troubles. The company said it plans to continue operations as usual, and use the bankruptcy process to restructure its debt and reorganize its business.

"The company worked with diligence to avoid a reorganization filing. Despite our best efforts and careful consideration of all other alternatives, the filing became necessary given the challenging economic climate," said Richard Meruelo, Chairman and CEO of Meruelo Maddux Properties. "Now our goal is to implement a comprehensive reorganization and continue to seek additional outside financing which we believe will allow us to move forward."

Excluded in the bankruptcy filing was the company's 35-story residential tower project that is currently under construction in downtown Los Angeles.  There are no anticipated disruptions, and once completed, the tower will be the tallest downtown residential structure in Los Angeles.

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