One of the Triangle's veteran homebuilders is shutting down after failing to successfully emerge from bankruptcy.
Anderson Homes, along with its younger cousin Vanguard Homes, has changed its bankruptcy filing from Chapter 11 to Chapter 7, meaning the Cary company's remaining assets will be sold to pay off creditors.
Anderson and Vanguard entered bankruptcy protection in March of last year. Under a Chapter 11 filing, a company submits a reorganization plan that must be approved by a bankruptcy judge and the company's creditors.
Anderson president Dave Servoss said the longer the company stayed in bankruptcy, the harder it became to emerge.
He said the accumulation of interest and attorney fees was swallowing up most of the company's operating budget.
"As one of my bankers put it, the bag of rocks was just getting too heavy to carry," Servoss said.
Servoss founded Anderson 30 years ago. At the peak of the housing boom, Anderson and Vanguard employed 66 people and built 350 homes a year in more than a dozen communities in the Triangle, Pinehurst, Sanford and Alamance County.
But like a number of Triangle builders, the companies ran into cash-flow problems when lenders tightened up.
When they filed for bankruptcy last year, the companies listed assets of $28.3 million and debts of $23.6 million.
Servoss hoped Anderson would emerge from bankruptcy with a smaller focus, building about 100 homes a year.
But Anderson was never able to submit a reorganization plan that all its lenders could agree to. Stock Building Supply, First American Title Co. and at least five of Anderson's construction lenders filed objections to the restructuring plan Anderson filed in October.
Servoss said the company's staff had been reduced to four before it submitted a request last month to have the bankruptcy filing changed.
David Warren, a bankruptcy lawyer at Poyner Spruill in Raleigh, said Anderson's plight has been all too common during the economic downturn.
"This is just part of a long line of problems for the developers and the builders," Warren said, "not just in this area but nationwide."
email@example.com or 919-829-4548