The next Panel & Engineered Lumber International Conference & Expo (PELICE) will be held March 14-15, 2024, again at the Omni Hotel in Atlanta, Georgia. PELICE is hosted every other year by Panel World magazine and Georgia Research Institute. This will be the ninth PELICE since its inception 2008.

“PELICE gets better with age,” comments Rich Donnell, co-chairman of PELICE and editor-in-chief of Panel World. “It has persevered through recession and pandemic, and also enjoyed the best markets to become a mainstay on the international stage.”

PELICE in 2022 recorded 450 participants on-site (including wood products producer personnel, exhibitor personnel, representatives from investor, consulting, academia and a range of other sectors associated with the structural and non-structural wood products industries).

Executives, plant managers, project managers, engineers, human resources and other personnel from wood products producer companies attend presentations delivered by dozens of industry personnel on a range of topics including mill project developments, technologies, economics, markets and products.

In addition, 100 exhibitor companies will set up in the Grand Ballroom North adjacent the meeting rooms. All of the exhibitors are classified as Gold, Silver or Bronze sponsors and participate in the sponsorship of the numerous food functions and promotions that complement PELICE.

PELICE 2024 has begun exhibitor sponsorship bookings while making initial contacts with conference speakers.

PELICE will once again be immediately preceded by the Wood Bioenergy Conference & Expo on March 12-13 at the Omni Hotel. Many exhibitors and attendees participate in both events. Attendee registration will open this summer.

A “Silicon Valley” startup company that intended to redefine the methods of operation of the conventional housing and building construction industry has gone bankrupt and appears to be headed for bidding in late July 2021.

Katerra, which sought to become the ultimate turnkey provider—including the self-manufacture of cross-laminated timber and building components such as windows and cabinets, architectural design and engineering services, in-house supply chain, off-site assembly of structural sections, and on-site modular assembly with company construction crews, filed for relief under Chapter 11 of the U.S. Bankruptcy Code in the United States Bankruptcy Court for the Southern District of Texas on June 6.

A day later the court released a bidding and possible auction schedule commencing in late July for the U.S. assets of Katerra and its affiliates, including the new cross-laminated timber facility in Spokane, Wash.

The company had stated upon the bankruptcy filing it was taking steps to conduct a “marketing and sale process,” while having secured $35 million in Debtor-in-Possession (DIP) financing to fund operations during the Chapter 11 process. The company’s international operations are reportedly not part of the filing.

The amount is a far cry from the $3 billion Katerra raised in equity investments, much of it through Tokyo-based holdings company Softbank and its venture capital fund.

In the bankruptcy filing Katerra estimated liabilities of $1 billion to $10 billion and assets of $500 million to $1 billion. Katerra said that many of its U.S. projects will be demobilizing. It directly employed 500 at the time of the filing.

“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,” the company states.

Two casualties appear to be Katerra’s new CLT manufacturing facility in Spokane, Wash. and new components manufacturing facility in Tracy, Calif. The $150 million, 270,000 square foot CLT facility commissioned in May 2019 and includes the latest CLT manufacturing technology. The 577,000 square foot, robotics-driven components facility in Tracy was just starting up. It had prompted Katerra to shut down its older components plant in Phoenix, Ariz.

A source close to the situation says Katerra was too diverse for a startup. “They tried to self-perform too many specialties from the get-go—not only multi-unit construction and CLT, but also architecture, bathroom fixture design, HVAC design, window manufacturing, global projects such as Saudi Arabia and India, etc. As for CLT, the rapid escalation in lumber prices made the system cost-prohibitive for all but a few projects.”

Indeed the unprecedented launching of lumber prices (CLT is composed of 2 in. lumber) was a scenario few could have predicted to such degree; however, another industry observed asked the simple question: Why didn’t Katerra build a sawmill to have better control over their raw material intake and pricing? After all, they bought about everything else. Another observer says the topic of building a sawmill did come up, but he wasn’t sure if Katerra ever asked for or received a quote on the construction of a sawmill. The CLT plant itself appeared to be operating satisfactorily when it had to shut down.

The Katerra startup in 2015 was led by a capital funding specialist named Michael Marks who had success leading electronics technology company Flextronics International, and Fritz Wolff, a third-generation executive chairman of a multi-billion dollar real estate development and investment business, The Wolff Company, which was founded and operated in Spokane until moving headquarters to Scottsdale, Ariz. (Katerra apparently built the plant in Spokane to create jobs for the community where Wolff was from.)

The new venture wasn’t shy about wanting to shake up—and speed up—the conventional construction industry. In addition to starting up manufacturing plants, it bought everything from architectural firms, to construction firms to dirt contractors. But many of the projects it entered into appeared to experience the same hiccups and cost overruns that conventional on-site construction projects sometimes encounter, and perhaps with less quality, as Katerra tacked on substantial costs related to re-work issues.

“They were arrogant people from Silicon Valley that thought everyone in the lumber business and construction industries were idiots,” another observer comments. “They thought all they had to do was show up and they would dominate. They told everyone they were a tech company and because of that their valuation was many times greater. But when people looked under the hood they saw no technology, just a bloated company with ideas that weren’t based in reality.”

Katerra reportedly experienced nearly $2.8 billion in financial losses in 2018, 2019 and 2020. Unprofitable projects continued to mount right up until the bankruptcy.

Katerra replaced Marks as CEO in spring 2020, only a year after Marks hosted the first Katerra TAKE OFF product launch event, which included building platforms, Apollo software, CLT product line, energy and electrical platforms, HVAC, interior fixtures and even a bath kit.

In May three senior members of the Katerra management team resigned and the company formed a committee to seek alternative financing, market certain assets and basically restructure the company. But no investor was willing to provide the financing and the company faced a critical liquidity shortfall and negative cash balance.

On June 1 Katerra ceased a majority of its operations in the U.S., which resulted in winding down more than 80 projects representing 77% of its active project revenue. It terminated 730 of its 1,300 employees in the U.S.

The bidding procedure, if approved, will be a stalking-horse bid scheduled to begin July 22, from which Katerra will choose a bid from a pool of bidders as the initial bid that sets the low-end bid. In the ensuing days other bidders may submit higher bids with the highest bidder winning the assets. If the bidding process doesn’t work out, the process can move to an auction format. The current proposed schedule is for the sale to close in mid-August.

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RoyOMartin commemorated 25 years of operations at its plywood manufacturing facility in Chopin, La. with a ceremony featuring a look back at the beginning stages of the plant and the impact it has had on the company and community since its inception.

Construction began in August 1994 on the Natchitoches Parish mill, which continues to be one of the largest of its kind in North America. Its first press load of southern yellow pine plywood panels was produced on March 8, 1996. The mill was the cover story for the November 1996 issue of Panel World.

Actually then president, the late Johnny Martin had drawn up a new pine sawmill to take advantage of the company’s substantial pine timberland coming of age, but the more Martin and his team looked at the situation, the clearer it became that a softwood plywood plant was the answer. “We felt in the long term that plywood had some inherent advantages over solid wood, mainly from a wood utilization standpoint,” Martin told Panel World in 1996. The plant itself at startup boasted a little more than 400,000 sq. ft. of manufacturing space. “We really wanted to put forth a first class facility,” Martin said.

In the past 25 years, employment has more than doubled, leading to a substantial economic impact on the region.

The 24/7 operation manufactures a variety of SmartCore branded plywood panels, as well as timbers, boards, and specialty products—all sold throughout the U.S. and, in some cases, around the world.

“We didn’t want to build a plant that made rated sheathing like everybody else,” stated Chairman, CEO and CFO Roy O. Martin III. “We decided, way back then, we were going to build a state-of-the-art finishing end to make the kind of products that are built to last. We started with one lathe and 330 people. Now we have two lathes, 720 people, a timber mill, and a forestry office. That’s some growth.”

Thirty-five current employees from the original startup team were honored for their 25 years of service to the company. COO E. Scott Poole commented, “We may have added equipment through the years, but none of that makes this history worth celebrating until we add the dedication of the men and women who have stood through the good and not-so-good times. We are the best because of them.”

Also honored at the event was Joe Mackay, who served as vice president of plywood for nearly 20 years. “Joe has made an invaluable impact on the organization,” said Martin as he presented Mackay with the Leadership Award. “He is a true industry leader.”

Regarding the anniversary, Vice President of Plywood Jeremy Burford stated, “What we are most proud of is our reputation in the wood products industry for taking care of our people through world-class safety and wellness programming, unmatched employee benefits, and our self-directed advancement program. The entire plywood team continues to demonstrate its commitment to working safely, operating at top efficiency, and satisfying customers every single day.”

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