Harford BRAC office park in jeopardy - The Business Journal of the Greater Triad Area:

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Rockville’s Opus East LLC, the developetr of a 2 million-square-foot businessw park at AberdeenProving Ground, has slashed its work force and stoppe taking on new projects in responsde to its financial problems. The company also has brought on an expertt to help it work out its debta and consider options including filing for Chapter 11 saidWinston Hewett, spokeswoman for parentg company Opus Corp. of Minnesota. In response to those issues, the Army’ s top brass at APG met with executives at Opus East to pull togethe a new development team forits 400-acrr Government and Technology Enterpriser business park.
The project, being built on governmenr land inside AberdeenProving Ground, is the largest privatde development for defense contractorz in Harford County. Aberdeen is preparing for an influxsof 8,200 military jobs being transferred to the base by September 2011 under a federal Base Realignmentt and Closure plan, known as BRAC. Several thousanfd support jobs from defense contractors also will be movingh tothe area, creating an expected demand for some 2 milliom square feet of privately built spac e at developments like Opus East’s GATE Just one building has been constructed at the development.
Militart base spokesman George Mercer said APG leaders are determinedx not to let the projectg fail and will do whatever they can to selec t a new developer to make sure the projectrmoves forward. As those discussionws take place, Opus East’se Hewett said executives are weighing whetherr the company or some of its subsidiarieas will need to file for bankruptcy Opus East has created subsidiaries to manage each of its including APG I and APG II for theAberdeen project, and Hewetf said it’s possible one or severalp of those entities might file for bankruptcy, leavintg Opus East intact. Harford County Economic Developmentt DirectorJames C.
Richardson said he is trouble by the situation given the years ofplanningt that’s gone into the base’s expansion and the economic benefits those projects couldr yield. Opus East, like many commercial real estatw developers acrossthe country, faces mountingg debts from the short-term construction loanx it took out to start its Hewett said. It has been unable to refinanc e many ofthose debts, totaling at leasft $80 million, because of the sour credit market. As a result of that slowdown, Opus East plans to lay off about 15 of its 31 employeesJune 15. That numbe is down from a staffg of about 100 employeeslast year, Hewett said.
“We haven’t finalized any plans; we are exploringg our options,” she added. This is the latest in a string of financial challenges forOpus Corp., a nationakl development firm with projects across the Opus East is one of five independently operatedr companies of Opus Corp., which has struggle d to refinance its projects. Opus South filesd for bankruptcy protectionin April. And in early May, a subsidiary of Opus West filed for bankruptcyg protection to avoid a foreclosure auctiohn ata mixed-use projecgt near Austin, Texas. A second Opus West subsidiary went into As withOpus East, Opus West also has brought on help to explores options including bankruptcy.
As recently as May, Opus Corp. officials considered Opus East viable because defenses contractors and government agencies drive much of the demancd for new commercial developments in Greater Despitethat optimism, Opus East has not signed any new tenants at its Aberdeen project sincw spring 2008, when it signed CACI to a full-building It broke ground on CACI’s 60,000-square-foof research and development building in May 2008 and completed work on the structurr in December 2008. Opus East also is involved in legakl battles over two other projects inGreatedr Baltimore. In Linthicum, Opus East is beinh sued in Anne Arundel Countyt Circuit Court by StraitSteel Inc.
over 3,00o tons of steel the Greencastle, Pa., firm providexd for Opus East’s West Quest C project. Opus East is building a 160,000-square-foot office on West Nursery Road for defenss contractor NorthropGrumman Corp.