Cardinal Homes files Chapter 11
Published 1:11 pm Wednesday, January 29, 2020
Cardinal Homes Inc is currently in a sale process known as a “Section 363 Sale” under Chapter 11 of the United States Bankruptcy Code.
Located in Wylliesburg and established in 1970, Cardinal Homes is a modular building component manufacturer in the Southeast and Mid-Atlantic markets.
The Berneche family purchased Cardinal Homes from the founding shareholders in 1992.
The company, which employees 56 people, filed a voluntary petition for bankruptcy protection on Dec. 2.
According to Brett Berneche, Cardinal Homes has received an offer from a financially sound entity to purchase all of Cardinal’s assets with the intention of continuing to operate the business.
“The prospective buyer has provided substantial financing to enable Cardinal to continue operating during the bankruptcy case,” Berneche said. “We don’t have an exact sale date, but it is expected to be completed during the latter half of February. Cardinal has a large order book and expects to hire a large number of employees and rebuild operations, once the sale process is complete.”
In a Jan. 21 press release to The Charlotte Gazette, SC&H Capital announced that Equity Partners, a division of SC&H Capital, has been retained to sell the business or assets of Cardinal Homes as well as the business or assets of Alouette Holdings, Inc.
Alouette Holdings owns the real estate, and a 115,274 square feet manufacturing facility on 53 acres, which is leased to Cardinal Homes for operations.
Fred Cross, a principal at SC&H Capital, said, “Cardinal is uniquely positioned to capitalize on favorable market forces, including high demand for traditional products, low competition, accelerating demand for higher-margin project business, and a pervasive national construction labor shortage.”
According to the release from SC&H Capital, the recently modernized factory has the potential to produce up to one module per hour, with an average per module revenue of $35,000 for residential and more than $40,000 for commercial projects.
“Cardinal Homes has greatly expanded its multi-family/commercial design team over the past two years and expects to progressively increase that part of the business with several hotels and multi-family projects on the horizon,” the release said.
“The company is moving toward a sale to a new owner and is expected to emerge from this process well-capitalized and able to rebuild to pre-recession capabilities,” Berneche added.
Monday, Charlotte County Administrator Daniel “Dan” Witt said he was optimistic for the company.
“Cardinal Homes has been an important part of Charlotte County for many years by providing jobs and the homes they built,” Witt said. “I am optimistic that the plan being worked on through the Chapter 11 case will be successful and allow Cardinal Homes to once again be a successful business.”