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Builder 100 2008
 

Builder 100 2008

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A deep dive into the Builder 100 data base presented at the Builder 100 conference in Scottsdale.

A deep dive into the Builder 100 data base presented at the Builder 100 conference in Scottsdale.

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  • I hope everyone is having an enjoyable evening. I want to take a few minutes of your time to give you our annual update on consolidation in the home building industry. Every time I come to this event, I can’t help but think back to my earliest Builder 100 events. When I started at Builder in 1995, the top 100 builders had a meager 12 percent market share. It was incredible that an industry could be so large and so thoroughly fragmented. The biggest builder built around 13,000 homes, for a 1 percent market share. Most built about a third of the homes they do today. Very few builders built in more than a couple states. We have much bigger companies leading the field today. But they took quite a set-back in the last year. Bankruptcy ripped through the industry—six companies in last year’s Builder 100 went under. We had reports of foreclosures, over building, a speculative bubble, credit tightening.

Builder 100 2008 Builder 100 2008 Presentation Transcript

  • The B UILDER 100: Ripped from the Headlines
  • Ripped from the Headlines
    • High-profile builders declare bankruptcy
    • Housing recession enters third year
    • Cancellations reach all-time high
    • Public companies actually lose money
    • Builder confidence falls to all-time low
  • What Does the Typical B UILDER 100 Company Look Like? Closed 3,597 homes, compared to 5,007 in 2006 Closings decreased by 19.23, compared to growth of 0.25% in 2006 Recorded $1.189 billion in revenue; $1.7 billion in 2006 Decreased revenue by 21.86% compared to 9.25% in 2006
    • B UILDER 100 companie s grossed more than $1 billion in revenue
    • B UILDER 100 companies are counted among the top 500 companies in the United States, according to Fortune magazine
    The Biggest Home Builders Shrink in Size 21 8
  • B UILDER 100 Closings Plummet
    • B UILDER 100 CLOSINGS (in thousands)
  • B UILDER 100 Market Share: Takes a Step Back
    • B UILDER 100 SINGLE-FAMILY HOME CLOSINGS
  • The Top 10 Builders: Share Holds Steady
    • TOP 10 BUILDERS’ SHARE OF U.S. CLOSINGS
  • Change on the Leader Board M.D.C. Holdings NVR The Ryland Group Beazer Homes Hovnanian Enterprises KB Home Centex Pulte Homes Lennar D.R. Horton 49,568 2. 41,487 3. 37,539 4. 32,124 5. 20,201 6. 17,500 7. 53,410 1. 13,123 10. 15,123 9. 15,392 8. CLOSED 2006 27,540 Pulte Homes 4. 30,684 Centex 3. M.D.C. Holdings The Ryland Group Beazer Homes USA NVR Hovnanian Enterprises KB Home Lennar D.R. Horton 33,283 2. 23.743 5. 14,928 6. 13,513 7. 11,366 8. 37,717 1. 8,195 10. 10,319 9. CLOSED 2007
  • Acquisitions Take a Break
    • ACQUISITIONS
  • How Much Influence Do the Public Builders Wield?
    • Their 255,819 closings accounted for 29.28% of the housing market
  • Fastest-Growing Public Company (Based on Three-Year Compound Rate) Comstock Homebuilding Cos. Reston, Va.
  • Biggest For-Profit Private Builders 1. David Weekley 4,587 2. Shea Homes 4,325 3. Kimball Hill 3,246 4. Pasquinelli 2,974 5. Perry Homes 2,825 6. MHI (McGuyer) 2,708 7. Woodside Homes 2,703 8. C.P. Morgan 2,677 9. The Drees Co. 2,536 10 . Villages of Lake-Sumter 2,403 RANK / BUILDER U.S. CLOSINGS
  • Biggest Closings Gainers 1. Taylor Morrison Homes 84% 2. MCZ Development 44% 3. Trammel Crow Residential 28% 4. Trend Homes 18% 5. Wood Partners 16% 6. The Mungo Companies 13% 7. The Olson Co. 9% 8. Centrum Properties 8% 9. Rausch Coleman Homes 4% 9 . McBride & Son 4% RANK / BUILDER Percent Gain
  • Fastest-Growing Private Company (Based on Three-Year Compound Rate) Highland Homes Plano, Texas
  • Some Amazing Facts from the B UILDER 100
    • D.R. Horton, with 37,717 closings, out-performed the entire Next 100 , which closed 30,213 units in 2007
    • Horton almost topped the combined closings for B UILDER 100 companies ranked 51 through 100, which closed a total of 38,114 units
    • Horton is the only builder to have ever closed more than 50,000 units in one year (2006)
  • More Amazing Facts from the B UILDER 100
    • Lennar grossed more revenue – $10.187 billion – than any other B UILDER 100 company
    • Lennar sold more condos than anyone on the list last year, 3136
    • It also sold 11,000 lots to Morgan Stanley for $525 million and retained development rights
  • Big Builders Focus on Operations
    • Ignore this
    TOP 10 CONCERNS OF THE B UILDER 100 OVER NEXT 10 YEARS
    • Reduce cycle time
    • Increase share in top 50 markets
    • Reach new demographic segments
    • Achieve greater efficiencies in purchasing
    • Even flow in sales and production
    • Value engineering
    • Developing subcontractor base
    • Integrating computer systems
    • Use of modular and panelized construction
    • Develop expertise in mid- and high-rise
  • Average Gross Profit Margins Decline
  • Average Net Margins Cut in Half