A tiny home builder that once boasted about being a $100 million company is going belly up.
On Tuesday, Anchored Tiny Homes’ CEO told NBC Bay Area that it’s “too late for reorganization” and that his family-run Sacramento-area building business is exploring bankruptcy.
The move leaves a lot of Bay Area homeowners who prepaid for ADU construction in a costly lurch.
Construction suddenly stopped in the yards of people like Maria Djapounova in Walnut Creek and Katie Lucas in San Leandro. They were paying hefty amounts, following their payment schedules on-time. But then, subcontractors walked off the job because they said the main contractor, Anchored Tiny Homes, stopped paying them.
“That’s when I lost it,” Lucas said. “Because when we were invoiced, we paid [ATH] right away.”
Djapounova is frustrated. “I don’t know where my money went,” she said -- in front of an ADU that’s less than half built.
Online, droves of angry customers spoke up. Now, the company is shutting down.
Anchored Tiny Homes CEO Colton Paulhus contacted NBC Bay Area. He declined to speak on camera, but shared a letter saying Anchored Tiny Homes and its franchise arm have “suspended operations and are currently evaluating our bankruptcy options.” He went on to say, “our intention is to file personal chapter 7 for all officers of the company.”
So, what happens next? Generally, the U.S. bankruptcy court ends up selling assets to pay back creditors.
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Homeowners are eager to line up in the hope of getting their money back. But they are not the only ones. We searched state corporate records and found more than half a dozen lenders recently filed liens on Anchored Tiny Homes for money that the builder owes them, too.
So where did this $100M business’s money go?
Former Chief Operating Officer Chris Pace said he quit Anchored TIny Homes because he didn’t like what he saw behind the scenes. There was “an element of bad business,” he said. But then, “pride and ego got to be too much” as the company’s finances spiraled and the owners scrambled.
Pace said customer money was used to fund Paulhus’s podcast. In a text message, Paulhus denied that allegation.
“None of it matters anymore. It was a failed business and I hate that it happened. Let Chris [Pace] get his moment of fame,” Paulhus said.
One local district attorney’s office told NBC Bay Area is going to look into the situation. The state contractor board says it’s investigating, too.
If you were an Anchored Tiny Homes customer, you can file a state complaint at CSLB.CA.GOV.
You can also tell the NBC Bay Area Responds team.
