Last week we introduced the National Association of Home Builders to you. Just over three weeks ago, one of their members ended up filing for bankruptcy.
The Home Builders Association of Greater Chicago (HBAGC) had to file bankruptcy on November 20th after not being able to pay its bills anymore after a four year housing decline which saw its membership drop from more than 1,500 members to around 500. In papers filed with the bankruptcy court, they indicated that they had assets of $100,001 to $500,000 and liabilities of $1,000,001 to $10 million. The group lost $283,737 last year, $241,010 in 2007, and had lost $257,132 in the first nine months of this year.
The Greater Chicago group is unique in that it spawned 3 chapters itself; the City of Chicago, and the North and South Suburban chapters. They even had their own health insurance program which they were working with Tandem HR and Benefits Solutions Group, LLC to provide for its members and independent realtors. They have a careers page for those looking for employment within the industry, as well as allowing some members to post their own resumes, hoping someone will find them.
The acting president of HBAGC, Tracy Hill, stated in a news release: “Over the last year, we have made significant progress internally on transitioning HBAGC to become more reflective of the needs of the current housing market. Unfortunately, at the same time, factors beyond our control have created a perfect storm in the industry – a 90% decline in permits within the Chicagoland area, matched with an unprecedented credit crisis, have made it impossible to support our current debt.”
HBACG is hoping to restructure its debt and continue to exist, and they’re hoping that better news in the housing industry in their area will help them reverse their fortunes. Days after announcing their bankruptcy, they came out with a report showing home sales up 33% in October over the previous year, and with a small decline in the unemployment rate in the area, they’re hoping that better times might be on the horizon.
Mitch Mitchell is a consultant who writes and participates in many different fields, including real estate finance issues. 
It’s always sad to hear about a business closing it’s doors. Hopefully they can hold on until the market really turns around.
With the present condition of the economy today, businesses big or small are all struggling to keep their business floating. Their chances of staying open are thin which is really not a good thing.
Its ashamed they couldn’t keep their membership up but it makes sense of course. Part of the market readjustment has been the loss of groups like this.
Bankruptcy affects over 2 million people and business every year. However, there are often better alternatives to getting a financial fresh start. Filing for bankruptcy can provide some advantages, if done correctly in the right way. Hope should be kept alife for the affected company.
It makes me wonder about HBAGC’s best practices in terms of managing their credit, and overall bottom line. This doesn’t come as a surprise though, as many other similar organizations have had to file for bankruptcy once the economy began to plummet.