Five-Star Development, an Arizona-based company behind properties like The Ritz-Carlton Paradise Valley, has voluntarily filed for Chapter 11 protection. The filing aims to protect the company’s assets and support continued progress on its flagship mixed-use project, The Palmeraie in Paradise Valley.
Five-Star Development Filed For Chapter 11
Five Star Development, LLC and 33 affiliated entities (together, “Five Star” or the “Company”) filed for bankruptcy protection in the United States Bankruptcy Court for the Southern District of Texas, according to Pacer.
“This process provides the structure and transparency needed to bring the resort to completion and preserve the integrity of one of the most important developments in Arizona,” said Gerald C. Ayoub, Founder and Principal of Five Star Development. “Our commitment to the Ritz-Carlton brand, our buyers, and our community remains unwavering.”
The case is mainly focused on completing The Ritz-Carlton Paradise Valley, The Palmeraie, a 122-acre master-planned resort, residential, and luxury retail destination. Here are the key case details:
- Case Number: 25-90607
- Judge: Alfredo R. Perez
- Filing Date: November 4, 2025
- First Day Hearing: November 6, 2025
- Debtor’s Counsel: O’Melveny & Myers LLP
- Restructuring Advisor: Pivot Group
- Chapter: 11
- Status: Voluntary, Active
About the Developer and Properties
Five-Star Development is in the final phase of development on The Ritz-Carlton, Paradise Valley. With infrastructure substantially complete, the company is set to commence high-end interior finishing as soon as the court approvals are obtained.
The project will feature a 215-room Ritz-Carlton resort, 80 branded villas, 32 estate homes, and a 29-acre retail and dining district anchored by luxury brands.
The Chapter 11 process allows Five-Star to retain control of the project while protecting the interests of stakeholders. The automatic stay prevents lenders, including Madison Realty Capital, from collecting debts or pursuing foreclosure during the restructuring.
A Texas state court recently found that Madison engaged in ‘acts of manipulation and fraud in breach of its duty of good faith and fair dealing’ toward Five Star.
During restructuring, Five-Star Development will continue normal operations across all project sites. Residents and homeowners will continue to access full-service amenities without interruption, and affiliated businesses will operate as usual.
Through the Chapter 11 process, Five-Star Development aims to stabilize its finances and complete The Palmeraie and The Ritz-Carlton Paradise Valley. The company remains focused on advancing these landmark projects, which are set to elevate luxury living and hospitality in Arizona.
