An indication that even the most conservative home builders in some of the more stable markets aren't immune to the crash in the residential construction industry, St. Lawrence Homes filed for Chapter 11 bankruptcy protection with the U.S. Bankruptcy Court Eastern District of North Carolina on Monday, Feb. 2.
The Raleigh, N.C.-based company, which also builds in Charlotte, N.C., Wilmington, Del., and Cincinnati, Ohio., cited market conditions as well as a "tightening of borrowing requirements placed on its sources of operating credit" as the reason for the filing.
Company spokesperson Rich Ohmann was hopeful the company would be able to move through the process quickly, emerging stronger than before. Assistance towards that goal will be provided by the company's balance sheet. The builder lists assets at $158,215,716 and liabilities at $116,380,445, leaving it with nearly $42 million in head room.
"We've got some room; we've got some equity in the company," Ohmann said Tuesday, Feb. 3. "Obviously, some of that equity we need to liquidate." That would include both homes and land, he added.
"I can tell you that we think we truly have a good plan for reorganization," Ohmann continued, adding that the company has a good relationship with its creditors at this point and that management believes it will be able to secure debtor-in-possession financing for the reorganization.
Founded in 1987, St. Lawrence Homes has received accolades for its quality and design.
Teresa Burney is a senior editor with BIG BUILDER magazine.