URBAN Corp, the worst-performing developer on the Japanese stock market this year, has filed for bankruptcy protection with debts of 255.8 billion yen (US$2.35 billion).
The company announced the filing yesterday in a statement to the Tokyo Stock Exchange.
BNP Paribas SA, the biggest French bank, bought 30 billion yen worth of convertible bonds from Urban on July 11, bringing some short-term financing relief.
As the number of bankruptcies among real estate companies skyrockets, firms in Japan have come under pressure to procure funds to buy new properties and refinance existing ones as banks curtail lending.
The lending balance to the industry declined for a fourth straight quarter for the three months ending in June, according to the Bank of Japan.
Zephyr, a Tokyo-based builder of condominiums, filed for protection from creditors with debt of 94.9 billion yen on July 18. Kyoei Sangyo, a construction company based in western Japan, sought protection from creditors on the same day.