Construction of Legacy Partners’ Livermore development on hold as entrepreneur Katerra files for bankruptcy | New

0



LIVERMORE – Construction of the 222-unit Legacy apartment complex in downtown Livermore could be delayed for weeks or even months as its developer seeks a new general contractor to complete the job, officials said from the city.

Work on Legacy Partners’ development came to a screeching halt in the first week of June when its contractor, Katerra, an international construction company, filed for Chapter 11 protection in U.S. bankruptcy court in Houston. Katerra’s subcontractors – such as plumbers and electricians – have been ordered to stop work, but could keep their jobs and return once Legacy hires a new contractor to replace Katerra, Van de Water, Director of Innovation and Economic Development for Livermore.

“At the end of the day, Legacy still owns it,” Van de Water said. “Legacy is still the developer. The developer is still 100% committed to the project.”

The mixed-use project which includes 14,000 square feet of commercial space and four-story apartment buildings was well advanced after its approval by Livermore City Council in June 2018. Construction on First Street commercial space, a restaurant and parking lot already has made significant progress on the site which once featured a Groth Bros. car dealership.

Katerra, an entrepreneur, supplier and designer founded in 2015, announced on June 6 that it has voluntarily filed for Chapter 11 relief, as “the company takes steps to conduct a marketing and sales process. in order to maximize value for its stakeholders “. Katerra said she secured $ 35 million in funding to fund her operations during the Chapter 11 process.

“The rapid deterioration in the company’s financial position is the result of the macroeconomic effects of the COVID-19 pandemic on the construction industry, from the inability to obtain a bond for construction projects as a result. the unexpected insolvency proceedings of Katerra’s former lender and unsuccessful attempts to obtain capital and business, ”Katerra said in a statement.

Katerra said the company will consolidate many of its U.S. operations, sell assets and secure debtor-in-charge financing.

In the Bay Area, in addition to the temporary halt to construction on its Livermore project, the bankruptcy filing also affected a Legacy apartment project in Hayward, where Katerra was also the general contractor.

According to its website, Katerra said it provides turnkey services, including architectural, interior design, materials and construction services for the projects.

Legacy partners did not respond to an email. A call from The Independent was referred to Ben Faoro, an official at the real estate company who is said to be handling the Livermore project, but he did not resend a message until the publication. Neither Legacy CEO W. Dean Henry nor the project’s architect, BDE in San Francisco, have returned a phone call yet.

Van de Water said the Legacy project was 100% insured and bonded, which would allow Legacy to identify a new contractor and continue work. He said the city viewed the shutdown as “an interruption and delay”, not the end of the project.

“It is in Legacy’s best interests to continue the work as soon as possible,” he said.

The project was to be completed by the end of the year.

In addition to housing, the Legacy at Livermore project is expected to include courtyards, a public road from South M Street to Railroad Avenue, as well as a private rooftop terrace and swimming pool. The apartments will be rented at market price.

It was not clear if any units are already rented.

It was also unclear how the subcontractors would fare in the meantime. Appeals to local union officials to determine which local businesses might be affected were not returned as of going to press.



Share.

About Author

Leave A Reply