Atlanta’s Lord Aeck Sargent will chart a new course forward as an independent architecture firm as its parent company begins a bankruptcy reorganization.
“The rapid deterioration of the company’s financial position is the result of the macroeconomic effects of the COVID-19 pandemic on the construction industry, inability to procure bonding for construction projects following the unexpected insolvency proceedings of Katerra’s former lender, and unsuccessful attempts to secure additional capital and business,” Katerra said in a statement.
Katerra said it has agreed to sell Lord Aeck Sargent, subject to court approval.
Lord Aeck Sargent has roots in Atlanta going back to the 1940s. The firm now employs around 100 locally, and about 150 in total at its six offices nationally. The firm’s Atlanta office is its largest.
Joe Greco, the firm’s president, told Atlanta Business Chronicle the firm has reached a binding agreement to return to being an independent design firm. The firm will be repurchased by essentially the former shareholders and some additional shareholders.
The plan is to keep the Lord Aeck Sargent name, he said.
“It’s business as usual. Our mission to bring responsive design, which is kind of our hallmark, to innovative, complex projects with awesome service remains as true as it ever has,” Greco said. “We are anxious about seeing the next chapter. So we are poised to move forward in our new arrangement, which will simply be a form of Lord Aeck Sargent again.”
The firm’s current projects are 100% unaffected by Katerra’s Chapter 11 filing. “We are working on every project we were working on prior” to the Chapter 11. “We have actually signed up a couple of new ones today, as a matter of fact,” Greco said.
The overwhelming share of the work Lord Aeck Sargent does and continues to be engaged in following its acquisition by Katerra “was really not affected by Katerra in any way,” Greco said. “It was thought to be a benefit to Katerra as Katerra expanded and went into new markets, so it was more aspirational than it was immediate.”
In its court filing, Katerra reported that it owes Atlanta-based Thyssenkrupp Elevator Corp. $4.1 million, and an estimated $2 million to The Home Depot. (Read the full filing here.)
“We are very excited to being back to independent. I would also like to thank the business community and all of our partners in the design and construction industry who have been very supportive of us through this process,” Greco said.