Battered by the pandemic and unable to regain its footing, a longtime local office furnishings company is seeking bankruptcy protection and searching for a buyer.
Office Interiors of Virginia, a 35-year-old firm based in Sandston, filed for Chapter 11 bankruptcy on Sunday.
The company said in court filings that the Chapter 11 process will allow it to remain in business, retain its 35 employees and attempt to sell the business or restructure its debts. It said many of its employees have been with the company for over 25 years.
Founded in Ashland in 1988, the company offers office furniture, office space design and construction, office moving and other services.
Bankruptcy filings state that the company’s cofounders both died unexpectedly, and it was then sold to new ownership in February 2020. The bankruptcy filings were signed by OIV’s CEO Othniel Glenwood Jordan, COO William Miller II, and CFO J. Kent Ford.
The company’s bankruptcy attorney, Brittany Falabella of the Hirschler law firm, said the timing of that sale couldn’t have been worse, as the pandemic threw the future of office space into an unprecedented gray area, parts of which continue to linger.
“The current ownership was put in place right before Covid and it has been a struggle to keep up with cash flow,” Falabella said Monday. “The timing was quite unfortunate.”
“It’s not an unusual story at this point: the pandemic affected both the labor costs and materials, and the supply chain was impacted and impacted all of their contracts and really created a difficult cash flow situation,” Falabella continued.
Under pressure, the company took out merchant cash advance loans, which it states only worsened its finances. It has since paid those down but has not been able to fully recover from the problems that began with the pandemic.
The company said it filed for Chapter 11 relief amid increased pressure from creditors and mounting lawsuits.
“We are looking at all options in terms of reorganization or a sale,” Falabella said.
The April 16 Chapter 11 filings lists between 100-199 creditors owed between $1 million and $10 million. It has assets in the same range.
It said its only main secured creditor is First Community Bank, which loaned the company $750,000 in 2022 and a $600,000 line of credit.
It owes around $100,000 to each of its three largest unsecured creditors: Available Material Handling, American Express and Hallowell. It also owes $87,000 to Atlantic Union Bank, $79,000 to edgeWorks Integration and $70,000 for health insurance to Cigna.
Its other debts include back rent of $36,000 to BREIT SE Industrial and another $23,000 to Thalhimer. OIV is headquartered at 5401 Lewis Road near Richmond International Airport.
At least two lawsuits have been filed against the company in recent weeks in Henrico County Circuit Court, by vendors R.A. Siewers and The New Haven Cos.
Falabella is joined in the case by Hirschler colleague Robert Westermann.