Orban’s survives foreclosure, bankruptcy to celebrate the holidays this year

BRADENTON — The greenhouses ooze with deep red poinsettias at Orban’s Nursery.

Marty Orban pauses from his morning chores on a recent Tuesday, stands in the thick of them and admires this season’s vibrant holiday blooms.

“It’s a beautiful sight, ain’t it,” Orban asks.

This year won’t be a profitable one for the nursery at 9505 Ninth Ave. N.W., according to Orban.

But he has plenty to be thankful for today.

A year ago his third-generation family business filed for bankruptcy reorganization and faced foreclosure.

Now, Orban’s Nursery is on track to clear both obstacles.

“It was a struggle we just got by,” he said.

Manatee County records show Whitney Bank will no longer prosecute the case and the foreclosure suit is scheduled to be dismissed in December. And, Orban said the profit he would have accrued for 2010 will be used to make payments to unsecured creditors.

“Things are definitely looking up,” he said.

Financial struggles hit the wholesale nursery when the economy took a nose dive in 2007. Orban’s Nursery began getting more cancellations on orders than ever before and was forced to reduce inventory, lay off employees and reduce operating hours. In 2008, Orban estimated at least $100,000 worth of presold poinsettia orders were canceled.

The West Bradenton nursery in April 2009 filed for Chapter 12 reorganization, a measure designed to help family farmers remain in business while reorganizing their debt. The nursery reported $190,600 in assets and nearly $1.18 million in liabilities, according to court records.

The bankruptcy reorganization eventually led to a foreclosure suit filed by Whitney National Bank in August 2009. The bank sued to foreclosure on a 2.6-acre site, contending Orban owed more than $478,000 on a mortgage and two lines of credit secured by the property.

A number of things allowed Orban to fulfill his financial obligations to Whitney Bank and fend off the foreclosure.

Wholesale orders to Publix, which makes up about 60 percent of the company’s business, helped Orban generate enough cash flow to put toward growing this season’s poinsettias. He also has been able to generate enough revenue to pay down his debt.

“If we couldn’t have come up with enough cash flow for the poinsettia crop last year, we would have had to close the doors,” he said.

In addition, the nursery acquired a specialized loan from the Farm Service Agency that helps family farmers refinance debt or pay annual operating costs.

Orban did not disclose the amount of the loan but Bronwyn Myers, farm loan manager for the Farm Service Agency, said the program issues up to $300,000 in operating loans.

Myers said the loans have been available since at least the 1990s but have become most popular in recent years due to the credit crunch.

“A lot of lenders are shying away from making loans today, even agricultural loans,” Myers said. “So many of the farmers who were able to get financing are seeking out credit with the Farm Service Agency.”

Thanks to the loan, the 90-year-old nursery stayed afloat.

The Orban family started the nursery in 1920, estimates Bill Orban, who passed on the nursery to his son Marty in 1976.

But the business started with Bill Orban’s uncle, Martin Orban. The elder Martin, who studied horticulture in Europe, started the business as a small flower shop just outside Cleveland, Ohio.

Bill Orban, like his son Martin, spent his childhood in the shop and working the greenhouses. Bill enjoyed the work so much he decided to study horticulture at Ohio State University once he returned from World War II with the U.S. Army Air Corps.

“It’s been a part of me all my life,” Bill Orban said. “When I was a small child, I had to work in the greenhouses. I think that’s one thing a lot of kids miss out on today. A lot of days we had to work and you became so used to doing what you’re doing, it became automatic to you, a part of you.”

Bill Orban gradually moved the operation to Manatee County due to heating and labor costs in Ohio. In about 1959, he opened a garden center in Holmes Beach.

And in the 1960s, he established greenhouses for annuals and poinsettias on 75th Street West. He estimates Orban’s began selling cut flowers and poinsettias to Publix in 1953.

The grocery remains one of its biggest customers among about 50 retailers that buy from Orban’s

“Orban’s Nursery is one of our poinsettia suppliers and has been for many years,” said Shannon Patten, Publix spokeswoman. “It is very important to us to support local growers and they do a great job of supplying us with a quality product. We are pleased to have a relationship with this local business.”

As more retailers and consumers learned of Orban’s Nursery in the 1960s, its production started to boom.

“We doubled production every year,” Bill Orban said. “I started out growing 500 (poinsettias) for myself. The next year it was 1,200, the next year it was 2,500, then 5,000 ... .”

This week, an estimated 150,000 poinsettias blanketed the greenhouses that take up 8 acres of a 30-acre property at Orban’s Nursery.

Wholesale orders have already begun shipping to Publix for the holiday season and an estimated 40 other clients of Orban’s Nursery are setting up their deliveries, too. Saturday Orban’s is open for its once-a-year sale to the public from 9 a.m. to 3 p.m.

While the estimated $700,000 to $800,000 the business is estimated to generate this year will mostly go to pay down debt, Orban projects 2011 will generate between $900,000 to $1 million in revenue. In healthy economic times, the nursery’s annual revenue typically hovered around $1 million or better.

“We’ve been around awhile, hopefully we’ll be here a lot longer,” Marty Orban said.

This story was originally published November 25, 2010 at 12:00 AM with the headline "Orban’s survives foreclosure, bankruptcy to celebrate the holidays this year."