Mexican homebuilder Urbi has filed for bankruptcy protection to restructure its debt, the company said on Tuesday.
The creditors which have so far signed the restructuring plan held some 21.9 billion pesos ($1.55 billion) in debt, equivalent to around 53.3 percent of the total claims on Urbi, the company said in a statement.
Urbi, Mexico’s third-largest homebuilder in recent years, is following its bigger peers after struggling under heavy debt loads and slumping sales of their cheap, single-unit homes in developments often located far from urban centers.
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Urbi said it was still coping with “constrained liquidity” to manage its operations and meet its obligations and that it was working with its creditors to eventually authorize additional financing and reactivate bridge loans provided by the company’s major bank creditors.
The builder, along with Geo and Homex, reported slowing revenue as more Mexicans chose to live closer to their jobs and schools and a change in government housing policy diverted subsidies to apartment purchases rather than single-family homes.
Homex and Geo, formerly Mexico’s No. 2 and No. 1 homebuilders respectively, filed for bankruptcy protection earlier this year. (1 US dollar = 14.0950 Mexican peso) (Reporting by Gabriela Lopez and Elinor Comlay; Editing by Grant McCool)