Chesterfield’s indoor farming startup Plenty declares bankruptcy after multiple lawsuits

The operator of an indoor farming facility that was highly praised in Chesterfield declared bankruptcy.

Plenty Unlimited filed for Chapter 11 bankruptcy, which will allow it to continue operating while reorganizing its business.

Contractors who claim they were not paid for work at the indoor strawberry farm of Plenty, located at 13500 N. Enon Church Road, filed lawsuits.

Anthony Grossi told the bankruptcy court that while Plenty is contemplating a sale, it will continue to run its Chesterfield and Wyoming operations after its bankruptcy.

A company press release stated that the company intends to pay wages to employees and continue to provide benefits during bankruptcy proceedings.

Grossi said that negotiations regarding the legal disputes relating to an expansion project in Chesterfield, the plant which Plenty leases, from California-based Realty Income Properties would be crucial to Plenty’s long-term future. The company plans to complete the expansion.

Grossi, speaking of the Chesterfield Farm, said that they needed to reach an agreement with the parties to get a discount for their claims. They also need to agree on the terms and conditions of the work to be done to finish the Richmond buildout.

He continued: “The project is not just to expand our facility beyond the current operational strawberry farm, but also to improve certain components of the ongoing operation in order to put us into a better position to achieve long-term viability on the commercial front.”

In a statement prepared in advance, interim CEO Dan Malech of Plenty attributed the company’s problems to market forces as well as challenges with securing capital investments.

“Our Company cannot be immune to the larger market dynamics or the fundraising challenges that our industry faces.” Malech stated that after evaluating our strategic options, we determined that this restructuring is in the interests of all the Company’s shareholders.

The Chesterfield facility will continue to be used for the production of strawberries. The company stated that it had secured financing of $20.7 million to allow it to continue its business during restructuring. Plenty filed for bankruptcy in the Southern District of Texas on Sunday.

We are lucky to have stakeholders that support and believe our mission of making fresh food available to everyone everywhere. Malech stated that the restructuring would allow us to work towards this mission by increasing our production of premium strawberry.

According to a bankruptcy filing, Plenty has assets and liabilities between $100 million and $500 million. The majority of the company’s liability is due to mechanic’s liens on the Chesterfield indoor farming facility.

Mechanicsville-based Electrical Controls & Maintenance ($8 million) and Glen Allen-based Century Construction Co. ($500,000) are among the non-insider creditor firms with the largest unsecured claims. The three firms filed lawsuits to force liens against the property in order to be compensated for work performed at Chesterfield.

Whiting-Turner is the latest person to sue over unpaid labor. Whiting-Turner has been tasked to supervise an expansion project on the indoor farm site known as Plenty Farm 2 in early 2023. According to the contractor, $69 million in work has been completed on this project. As of the March 18 filing by the contractor, only $48,9 million had been paid, leaving $20,1 million unpaid.

Whiting-Turner – which was the lead contractor on the site – is asking Chesterfield Circuit Court for an order to sell the Enon Church Road Property to raise money to pay what is allegedly due. The company also wants a court order to force Plenty to pay the money it owes.

Whiting-Turner said in court documents that it had stopped working on the project at the beginning of November because it hadn’t been paid since August. The contractor said that it filed mechanic’s lien totaling $13.3m on the indoor farm which is located on a 22-acre parcel in the Meadowville Technology Park.

Whiting-Turner filed the Chesterfield case against Plenty last year, and it is related to the local farm. Both sides have already filed a lawsuit in federal court where Whiting-Turner claims that Plenty has breached a guarantee agreement related to the project.

In recent months, a number of firms hired to work at the facility recorded liens on the property. Ashland’s J.S. C.T. Purcell Excavating in Henrico; ColonialWebb, Chester, New Market Asphalt Corp.; Richmond, Liphart Steel; Hanover, James River Nurseries, and Richmond, W.W. Nash & Sons. The property has also been seized by other companies with offices in Virginia or in other states.

Whiting-Turner, as the general contractor for the project, is responsible for facilitating payment to subcontractors. This has led Century and ECM to sue Whiting Turner. In these two cases, Plenty and its landlord are also named as defendants.

In response to ECM’s January lawsuit Realty Income, the owner of the Chesterfield facility run by Plenty, stated that it was not involved in the project, and had signed no contracts with the firms hired to work on the Project. It claimed that the property should not be sold to pay off liens. In its response to ECM’s lawsuit, Plenty requested that the court dismiss this suit.

As of this week, Plenty and Realty Income has not yet responded to the Century lawsuit that was filed earlier in the month.

In 2022 Plenty announced the Chesterfield Project and outlined a vision for a $300-million campus with multiple farm facilities spread across 120 acres of Meadowville Technology Park.

only a single farm was built on the property. When it was opened in late 2018, Plenty described the facility as 100,000 square feet with 40,000 sq. ft. of growing area. Construction began on the expansion project, which is the subject of the lawsuits, in the fall 2023.

According to a spokesperson for Plenty, strawberries produced at the Chesterfield facility were first available in the market during January.