Naples-based Metro Home Builders declares bankruptcy
As expected, Metro Home Builders of Naples declared bankruptcy.
The company’s Naples attorney Gregory Champeau acknowledged a Chapter 7 complaint was in “final stages of preparation.” last week.
After years of financial and operational issues, owner Alberto Hernandez plans to sell the company’s assets to pay off its debts. He’s gone out of business with the builder’s offices closed, model home sold, and building halted, according to a recent article by Laurel Layden of Naples Daily News.
Champeau emailed, “The debtor ran into substantial cash flow deficiencies based upon inflation, labor and increased supply costs and shortages.” “Despite best efforts to reorganize and restructure the business, it could not continue operating without harming its creditors.”
The bankruptcy petition lists over 65 creditors and $3.3 million in liabilities for the custom home builder.
Machinery, equipment, and vehicles make about $82,000 in assets.
Decline leaves customers in limbo
Unfinished homes and warranty work have left customers in limbo. Some have complained on social media and asked for aid, while others have filed formal complaints with the Florida Attorney General’s Office, Florida Department of Business & Professional Regulation, and Better Business Bureau.
The bankruptcy filing lists most claims as liabilities for pending customer building projects. Two customer claims are roughly $178,000 based on their contract amounts and remaining work.
A document reveals over 60 unfinished dwellings at varying stages of construction.
The builder owes credit cards, staff, utilities, suppliers, vendors, and ads. Hernandez’s $248,422 loan to fund operations as a shareholder and principal is the greatest claim.
Hernandez got almost $503,000 in shareholder distributions in March and $623,000 in June, according to the report.
The corporation listed three-year operating losses without amounts.
The builder earned over $14.8 million this year (Aug. 14). The filing reported revenues of $9.8 million in 2022 and $11 million in 2021.
Business information portal ZoomInfo reports the builder has 14 employees at last count. It had been operating for nine years.
The owner’s construction contractor license expires next August, according to state data.
The company had a Golden Gate Estates model home. Another local homebuilder uses 107 Weber Blvd., off Golden Gate Boulevard, as a sales and administrative office.
Property records show 2007-founded Majestic Builders bought the home through an entity in May for $1.3 million. The custom builder simply bought the actual estate, but Metro’s disgruntled customers have gone to it for answers.
Construction sites abandoned
Boris Deriy petitioned the Attorney General’s Office, alleging that Metro Builders stole almost 75% of the money for his and his wife’s new house and vanished without completing it.
End of May, we observed work ceased. The construction site has since been abandoned and deteriorating. He stated rains washed away the sand under the concrete footing, threatening the structure and house.
After the construction halted, other Metro employees created their own companies and offered to finish incomplete houses at a higher price, with Hernandez promoting them as “help,” even though they were unprofessional and unqualified, Deriy added.
“Metro Home customers are left alone in this devastating situation right before hurricane season and forced to pay triple the price for the same materials and services they have already paid for,” he said.
He assessed his and his wife’s losses at over $100,000. They contracted for almost $551,000 in work in December 2021, including $92,000 in modifications.
Also, Martina Williams protested to the AG. She and her husband signed a deal in March 2022 to finish their home by July.
She stated they discovered construction stopped abruptly “sometime in May,” with 70% done.
She then revealed that Metro had received the second-to-last payment of almost $101,000, with the final $50,600 to be paid once the couple had their certificate of occupancy for the house before moving in.
After the work stopped a few months back, the couple demanded answers, but they were slow. Williams claimed they were informed the company was restructuring and would contact them in a few weeks to resume work in July.
She said the owner emailed on Aug. 1 that he would not finish their home and would file for bankruptcy.
Please help
With “limited reserve funds,” the Williamses have an incomplete home, she noted.
She sought the Attorney General’s Office to help them recover part of their money to finish.
She remarked “My family and I are figuratively homeless with no real direction on where to go next”. “We can’t afford another builder to finish the job.”
Rural Golden Gate Estates residents’ private Facebook group for news and tips was outraged by the bankruptcy news in recent weeks. Some group members have shared their unfavorable experiences with Metro as their builder.
Based on years of negative internet and social media experiences, many aren’t surprised Metro will fail.
Some wealthy homeowners have found different builders or are seeking to finish their properties themselves.
Southwest Florida has hundreds of tiny, independent custom house builders with good and terrible reputations.
The original article can be found at Naples Daily News