It's Official, DBSI Files for Bankruptcy
DBSI Inc, and more than 140 of its entities filed for Chapter 11 bankruptcy in Delaware, earlier today. Here is a link, via CNBC, to a Reuters article announcing the filing. I guess this filing throws the good properties in with the bad properties. I would not doubt that properties that are cash flowing, but subject to the DBSI master lease, will now see their distributions stopped. DBSI, at first glance, appears to be looking out for itself first, and not its investors. I wonder what this does to many of its mortgages? I would not be shocked if even good properties are in technical default now that DBSI filed bankruptcy. There have also been several lawsuits filed that will likely seek class status. Investors' rush to file lawsuits and DBSI's rush to file Chapter 11 has made this a nightmare. At the bottom of the Reuter's article is the meme blaming the bankruptcy on the housing market. This is BS. DBSI's problems started long before the housing market collapse.