StoryBuilt, one of Austin’s most active urban developers, has launched a major reorganization and furloughed employees as it deals with a financial meltdown.

In a letter sent to StoryBuilt investors Friday, co-founder Anthony Siela said: "As you are aware, StoryBuilt has recently struggled with focused growth, reporting/financial controls and liquidity. This has materially affected our performance as a business and our partners."

Siela said co-founder Ryan Diepenbrock has resigned from day-to-day management duties, and Chad Shepler has resigned from his role as chief operator and director of StoryBuilt's board.

Siela said the board of directors has delegated board authority to an executive oversight committee made up of stakeholders, an independent director, and Preferred Class A and Common B shareholders.

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Siela said that "in response to current financial realities," StoryBuilt has furloughed much of its staff over the past couple of weeks and expects to have "a vast reduction in headcount with the aim of solely focusing on core development services for our projects and partners."

StoryBuilt was founded in 2001 as PSW Real Estate and is based in Austin. The firm specializes in infill projects, building mixed-use developments with apartments, condominiums, townhomes and single-family homes as well as shops, restaurants and retail space.

In Austin, StoryBuilt has been a driving force behind the latest wave of development on South First Street along Bouldin Creek in South Austin. The corridor has seen a surge of growth in recent years, with new restaurants, boutiques, food trucks and housing.

StoryBuilt mixed-use projects include 2001 South First St., across from Polvos Mexican Restaurant; 900 South First St., across from the Texas School for the Deaf; and 1600 South First St., the former site of Angel Funeral Home. In 2021, StoryBuilt said it had begun construction on a condo and office project in East Austin at 755 Springdale Road.

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According to StoryBuilt's website, it previously had a team of 250 people.

Siela said StoryBuilt is now moving away from all-in-one projects, in which the company bought properties and oversaw every aspect of their development, from building to selling.

"We are working in concert with our Shareholders, Retail Limited Partners, and Institutional Joint Venture Partners to look at every aspect of the business for improvement and set a new bar," Siela's letter said.

More: Austin developer StoryBuilt expands South First project

To support the reorganization, StoryBuilt — which also has developed projects in Dallas, Seattle and Denver — will be bringing in bridge capital, he said.

"The foregoing changes may raise concerns about your investment. We plan to continue written communications weekly at a minimum and schedule a virtual town hall meeting next week," Siela said.

This article originally appeared on Austin American-Statesman: Austin urban developer StoryBuilt is reorganizing, furloughing staff