GreenSteel owner files Chapter 11

A poor housing market has temporarily halted operations at Carrabelle’s GreenSteel Homes manufacturing facility, leaving workers unemployed with Christmas approaching.

On Nov. 20, Hexaport Building Systems of Florida, owner of the GreenSteel factory, filed a voluntary petition for Chapter 11 reorganization in the Northern Florida District of the US Bankruptcy Court.

Chapter 11 allows individuals or companies facing bankruptcy to reorganize their finances and in most instances, continue to run the business under the supervision of the court. Creditors are ordered to cease attempts to collect debt until the reorganization is complete.

A debtor then may “emerge” from a Chapter 11 through the use of a bankruptcy plan. Tony Attalla, owner of Hexaport, said he is in the process of creating such a plan to bring before the court. He and his Tallahassee attorney, Robert Bruner, have until March 22, 2010 to present the reorganization plan.

Attalla appeared before the Carrabelle city commission Dec. 3 to discuss the company’s financial situation. He told commissioners that while he continues to employ a few workers with his own money, the assembly line at the factory is shut down. He said all employees’ wages have been paid up-to-date.

The commission agreed to refrain from taking any action regarding Hexaport for at least 30 days.

“Currently we only have one house under construction and are operating with a skeleton crew,” said Attalla, in a later interview. “Hopefully, we can have the assembly line back up and running in 10 days. I would like nothing better than to give out a paycheck before Christmas.”

Attalla, who is now a Florida resident, said the company has a possible order from Florida State University in January. “I live in Carrabelle, not Tallahassee or St. Joe,” he said. “I consolidated all my operations into this factory. I put all of my eggs in one basket and now I am hoping for Easter.”

Attalla said Hexaport, in addition to reorganizing debt, is working on acquiring more contracts. He said the firm has numerous inquiries every week but, “turning those into sales is a lot of work.”

He said bringing in additional equipment has allowed him to set up for both commercial projects as well as residential units. The Carrabelle factory will now be fitted to produce trusses and walls as well as finished cottages.

“We are actively pursuing large projects now and seeking additional investors,” he said. “The bright side is that, if the market turns even slightly, the factory will be successful.”

Chiles helped bring plant, then sold his interest

The GreenSteel plant was the brainchild of Lawton “Bud” Chiles III of Tallahassee, son of the late Florida governor, as well as Attalla, who is formerly of New Hampshire.

The factory was built to produce houses based on the “Katrina Cottages” designed by Tolar Denmark Architects for construction in post-Katrina Louisiana and Mississippi. Nicknamed GreenSteel because they are both tough and environmentally friendly, GreenSteel structures are resistant to hurricane force winds, fire and mold.

Hexaport broke ground on the Carrabelle factory in June 2007.

Carrabelle applied for and received a Community Development Grant to help pay for the project and provided a 99-year lease for the 21-acre factory site at $10 a year. Carrabelle invested about $1.5 million in infrastructure to support the project.

The hope was the plant would provide much needed jobs for the community. A job fair held in Sept. 2007 attracted over 100 applicants for 50 possible jobs and another 88 applications were turned in at City Hall before the factory opened its doors.

At the groundbreaking, Chiles said GreenSteel would initially employ 50 people but promised it could provide work for as many as 350 when operating at full capacity.

In reality the plant has never employed more than two dozen workers.

At the job fair, Chiles said, “I think there will be four or five developments in Carrabelle that will be exclusively GreenSteel. We want to give priority to local developments. We are committed to providing affordable local housing.”

When completed, the Hexaport facility was to cover 1.5 acres and would have the capacity to manufacture up to 400 houses a year.

Chiles repeatedly vowed he had orders waiting to be filled when the factory opened, but the number of orders was unclear.

At the 2007 job fair, Chiles said, “One of our first contracts is a six-story hotel on Marathon Key. We’re going right into hurricane alley on a little spit of land between the Atlantic and the Gulf.”

He repeatedly said had standing orders for 125 houses.

Chiles and GreenSteel parted ways in Oct. 2008 in what Attalla earlier this week called “a surprising turn of events.” Attalla bought Chiles’ share of the factory after Chiles attempted to buy him out.

Attalla said the breakup occurred around the time the first model home left the assembly line, and that at the time of the purchase, there were no outstanding orders for houses. He said he knows nothing about the Marathon project to which Chiles repeatedly referred.