Builder going out of business
Barratt American, once one of San Diego County’s leading home builders, is going out of business — a victim of the real estate slump and, perhaps, its expansion into pricey housing projects and big master-planned communities.
The company, which filed for Chapter 11 bankruptcy reorganization in December, agreed to switch to Chapter 7 bankruptcy liquidation last week after its creditors complained that reorganization would be “futile.”
Barratt President Michael D. “Mick” Pattinson, who with local management partners had acquired the company from its British owners in 2004 for $165 million, said yesterday that he intends to start a new company next year after learning the lessons of building in a boom and bust.
“Here’s the mistake we builders made — we went on building when we should have put our tools down and stopped work and said these land prices are ridiculous, the time to get entitlements is stupid and $100,000 per house in fees is unconscionable,” Pattinson said.
The company peaked at 160 employees — it now has just five — and ranked as the 22nd-largest local home builder in 2005, when it sold 172 homes, according to MarketPointe Realty Advisors. Since then, the company has fallen off the top-25 builder list, said MarketPointe President Russ Valone.
Read Roger Showley’s full article “Real estate slump blamed for Barratt American’s failure” in Sign on San Diego (August 11, 2009).