Legacy Homes, which already has a small presence in the Omaha homebuilding market, wants to reassemble the HearthStone Homes business model and will start by using the bankrupt company's showroom, a spokesman says.
Whether Legacy eventually takes on the HearthStone name has yet to be determined, said attorney Peter Katt.
Also unknown is whether Legacy will succeed in efforts to buy larger HearthStone assets: 600 undeveloped lots and 40 houses the homebuilder was working on when it filed for Chapter 11 reorganization in February.
How closely the Legacy Homes operation will resemble HearthStone, Katt said, will depend in part on approvals by the court-appointed trustee assigned to liquidate assets. HearthStone, according to court records, owes at least $24 million to Wells Fargo Bank and multiple other vendors.
Legacy officials, including owner Steven Champoux, have been negotiating with Trustee Randel Lewis over various matters related to a HearthStone purchase.
Regardless of how much more of the bankrupt company Legacy acquires, Legacy intends to set up shop in Omaha, Katt said.
“The HearthStone model — those parts that made it successful — will continue, hopefully, under new ownership,” Katt said.
He added: “It's easier to fix a machine that's broken than it is to build a new one.”
Legacy Homes LLC was formed by Champoux in December 2009. He was unavailable for comment, but Katt said Champoux has been studying the Omaha market the last few years. City planning records show that Legacy took out permits to build three single-family houses in 2011.
He and brother Rob Champoux also own Lincoln-based Prairie Home Builders, which constructed dozens of homes in the Omaha area the last few years. Katt said that Rob will not be part of the Omaha Legacy operation.
Many pieces are in motion, Katt said. But Champoux's intention, Katt said, is to bring on certain past HearthStone managers to help run Legacy.
“The secret to the success with my client moving forward is to take advantage of skills that were associated with the operation HearthStone had.”
At one time, HearthStone was the largest production homebuilder in the area, building more than 900 houses at the local market's peak in 2007 and more than 300 last year. Its income plummeted the last few years, from $74 million in 2010 to $48 million in 2011 and $2.68 million in the two months of 2012.
This week, the bankruptcy judge approved Legacy's purchase of the HearthStone Choice Studio, where homebuyers picked out appliances, flooring and other finishes.
The studio took up about half of the HearthStone third-floor corporate office space at 810 N. 96th St.
Legacy paid $50,000 for the Choice Studio contents as well as other furniture in the company headquarters. The transaction required also that Legacy pay past rent owed to the landlord, about $155,000.
Legacy will reopen the Choice Studio, said Katt, although he was not certain when. He said that, subject to the bankruptcy court's approval, Legacy would gain temporary rights to use the HearthStone computer software system and building specs.
Another HearthStone piece that Legacy hopes to revive, Katt said, is the working partnerships with HearthStone's old subcontractors and vendors.
However, responsibility for any HearthStone home warranties or past business debts will not be assumed by Legacy, Katt said.
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