Bankruptcy

North Georgia business bankruptcy filings surge

 

From the Atlanta Journal and Constitution:

The popped housing bubble and crushed credit market have pushed record numbers of North Georgia businesses into bankruptcy court this year.

Chapter 11 filings are up between 50 percent and 70 percent over all of last year, depending on how they’re counted.

They’re also up significantly from any of the past 20 years — and there are almost 10 weeks left in 2008.

As of Friday, 283 companies and their affiliates had filed for Chapter 11 protection from creditors in Georgia’s Northern District, which has offices in Atlanta, Gainesville, Newnan and Rome.

Jeffrey Kelley, head of the bankruptcy practice at the Troutman Sanders law firm, said the surge is the biggest he remembers.

“This is higher than I’ve seen, and I’ve been doing this since 1975,” Kelley said.

Not surprisingly, most of the swell in business bankruptcies is tied to the downturn in the real estate market, with homebuilders and contractors making up a large percentage of new filings. As the real industry continues to languish, the number of additional bankruptcy filings will undoubtedly increase.

 

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