Bankruptcy filings from Nov. 5-6 shed more light on the financial condition of Warrenville, Ill.-based Neumann Homes.
The builder owes $217.4 million to eight lenders under 12 separate credit facilities, according to court documents. Those lenders are Bank of America, Cole Taylor Bank, Comerica Bank, First Midwest Bank, Guaranty Bank, IndyMac Bank, RBC Centura Bank, and Residential Funding Co.
Neumann's contractors also have the ability to put mechanic's liens on the builder's properties. Neumann estimates that, as of Oct. 10, 2007, it owes those suppliers approximately $11.9 million. That figure could increase.
Subcontractors have 90 days after Neumann's bankruptcy to file mechanic's liens, and general contactors have four months, according to Greg Eichorn, a partner in the Chicago law office of Peckar and Abramson. "They want to get in line for the bank to preserve their rights," he said. "There's probably going to be quite a few mechanic's liens in all of these areas."
Finally, Neumann owes approximately $6.3 million to contractors with respect to work on homes that the builder has already sold. Those could be lienable against the home, leaving Neumann's buyers in a tenuous position.
Neumann also gave a rundown of its assets in the filing. It has 22 active development projects: 15 in Illinois, four in Colorado, and three in Wisconsin. Within these projects, the company owns 149 homes currently under construction or substantially built but still incomplete. It also has 76 spec homes and eight model homes.
Neumann currently controls 334 lots in Detroit (92 lots are undeveloped), 3,148 homesites in Chicago and southeast Wisconsin, (2,506 are undeveloped), and 703 homesites in Denver (417 are undeveloped). It has 860 acres of land in Chicago and Southeast Wisconsin and a 960-acre master planned development that is entitled for 4,400 homes and 1.35 million square feet of commercial space.
