Construction Jobs Blog

I was reading Forbes.com today and stumbled across a column that put a smile on my face.  While researching “the effects on the economy and job market from…greater green industry,” Michael Marks came to the same realization I did a short while ago:  “lo and behold, I found a topic that is nearly universally positive.”

With housing and financial turmoil, the increase in energy costs, and disasters dominating headlines for the past few months, it may be easy to overlook the progress of green industries and the promise they hold for America’s future.  And their promise is starting to be fulfilled:

– 2007 set solar energy records:  314 megawatts of new solar-generating capacity were constructed or installed in the U.S. last year, creating more than 6,000 new jobs and adding over $2 billion to the economy

– the number of jobs in “renewable energy or energy-efficient industries” is skyrocketing, with the American Solar Energy Society estimating it at about 8.5 million, and Marks predicting it could clear 40 million by 2030

The government is stepping in as well: Continue Reading »

No Comments »

Builder Magazine released a sneak peak of the results from its well-known Builder 100 survey this week.  According to the results, David Weekley Homes rode its Texas markets to close the most homes of any private for-profit builder in 2007.

In 2006, Weekley came within 300 closings of then leader Shea Homes.  The jump last year landed Weekley at number 16 on 2007’s Builder 100 list (coming in early May), a gain of two spots.  Weekley closed 4,587 homes last year.

Shea, however, has not handed over all the reins to Weekley.  In 2007, Shea was still the largest private builder in terms of cash, with $2.15 billion in revenue.  Weekley rang in at number 2, with $1.34 billion.

D.R. Horton ranked first overall on the Builder 100 list for the sixth year running, closing 37,717 homes last year.  Lennar and Centex followed at second and third respectively; these three are the only builders to post more than 30,000 closings in 2007.

Here are the Top Ten Builders in 2007 from Builder magazine: Continue Reading »

No Comments »

Yesterday, Centex Corp. announced the sale of a portfolio of properties through its subsidiary Centex Homes.  The joint venture is led by RSF Partners Inc. and has a price tag of $161 million.  Added to the $294 million in expected tax refunds, the total is about $455 million.

Roughly 8,500 lots in 27 neighborhoods throughout 11 states, mostly in California and Nevada, make up the portfolio.  Centex chairman and chief executive Timothy Eller said, “This transaction is consistent with our near-term goals of reducing our land supply and generating cash;” it “… accelerates our move to a more asset-light operating model, sharpens our focus on strategic markets and consumer segments, reduces future land development cash obligations and monetizes a meaningful portion of our deferred tax asset.”

Even though the lots are already developed or partially developed, Centex expects to save $265 million in future development costs related to the properties.  Centex has a 5% interest in the joint venture, and will get a larger share of distributions of certain fiscal goals are met.

No Comments »

Today, the National Association of Realtors (NAR) reported that sales of existing homes increased in February, offering a ray of hope to the besieged residential market.  NAR Chief Economist Lawrence Yun commented on the data, saying “the latest reading on home sales further confirms stabilizing trends.”

February saw existing home sales increase 2.9 percent and break the 5 million unit pace (seasonally adjusted annual rate).  While sales are still down significantly from first quarter 2007, Yun says “the relationship between home prices, interest rates and income has improved to the point where buyers are more serious about making offers.”  In fact, about half of the U.S.’s metro areas witnessed price increases. 

While still high, total housing inventory was down 3 percent at 4.03 million existing homes for sale, a 9.6 month supply at the current sales pace.  January had a 10.2 month supply.  Yun called the decrease “very unusual,” and said it may indicate that the rush of speculative investors has tapered off, or that sellers are holding off listing.  Also, “according to Freddie Mac, Continue Reading »

No Comments »

Fannie Mae and Freddie Mac got a boost from regulators today, who announced new regulations to help the housing market.  The Office of Federal Housing Enterprise Oversight (OFHEO) lowered the two agencies’ minimum capital surplus from 30 percent to 20 percent.  The 10 percent adjustment will pump $200 billion of much needed cash into the mortgage market.

The result will be lenders providing more money for loans, hopefully at lower interest rates.  Treasury Secretary Henry Paulson said, “additional capital will enable the companies to help more homeowners and will strengthen the underlying fundamentals of the mortgage market.” 

No Comments »

Recent news coverage of home builders has been generally negative.  Reorganization, downsizing, and bankruptcies make headlines, and the debate over a possible recession wages on.  It is easy to see why most people think housing is a mess, and in many areas the market is challenging, to say the least.  But during market corrections it is easy to lose sight of the bigger picture.  The fact of the matter is that in the coming years, the U.S. home building market will provide rich opportunities for growth and expansion to companies on the upside of this downturn.

In talking to recently-named President of U.S. Operations for Mattamy Homes, Steve Parker, I found a breath of fresh air from the gloom and doom of mainstream news.  And I believe that what he said is important because it accurately represents the position of a large number of smaller home builders across the nation, who reporters have passed over in decrying this historic correction.

Some smaller home builders like Mattamy are finding themselves better suited to survive the slowdown than a number of the larger, public builders. Continue Reading »

No Comments »

Last week at the IBS, Jeffrey masters, a partner at Cox, Castle & Nicholson, and David Crump, Jr., director of legal research for the NAHB, hosted a seminar titled “Green Building Legal and Liability Issues.”  In it they discussed the various potential threats and dangers posed to builders of green homes.  Far from discouraging green builders, the seminar instead advised on how to build green while avoiding serious hazards.

First, the pair noted that the field of green building is still young, and that developments in the coming years will continue to change how we define and think about green homes.  This being the case, builders need to plan ahead, both in their plans and their contracts, to minimize risks and protect their businesses.

“The most important tip Masters and Crump handed out at the seminar was: Continue Reading »

1 Comment »

In a statement issued last week, former NAHB president Brian Catalde declared that homebuilders would stop making political contributions because lawmakers have been unresponsive, in that they have not “adequately addressed” the economic issues that may help stabilize residential construction.  The following is the official statement:

“Today, the National Association of Home Builders’ Political Action Committee, BUILD-PAC, and its 150-member Board of Trustees representing all 50 states, agreed to cease all approvals and disbursements of BUILD-PAC contributions to federal congressional candidates and their PACs until further notice. Continue Reading »

No Comments »

A couple weeks ago, I was working on a publicity project with a smaller, private homebuilder.  Their goal is to increase production from just under 1,000 units to about 5,000 units in the next five or so years.  I spent some time speaking with the President about the company’s future, and what he needs to do now to get it there.  I asked him what was most important for his success, and he said, “the need of the right people!”

I went on to ask him about the qualities he looked for in potential candidates.  “The right individuals,” he said, “are those that have the ambition to be part of a growing company.” 

“The people I look for are individuals with a strong passion for business, a high sense of energy and drive, and are well respected within the business.  Relationships are key, and the individuals must want and like to be part of a growing organization.”

Homebuilding jobseekers should take much of what this President said to heart.  There are great opportunities with many smaller builders right now, who have the opportunity to grab market share and experience tremendous growth on the upside of this cycle.  Those companies need a certain type of individual:  Continue Reading »

1 Comment »

Officials announced on Tuesday that the F.B.I. is investigating 14 companies tied to subprime lending for potential accounting fraud and insider trading violations.  The agency said the investigation encompasses “developers, lenders, and financiers that securitized ordinary home loans into exotic investment instruments, as well as banks that held them” (Reuters).  Securities and Exchange Commission officials have opened more than three dozen similar investigations, and are cooperating with the F.B.I.  Such big names as Bear Stearns, Goldman Sachs, and Morgan Stanley have been asked to release certain information about subprime activities to the S.E.C.

It will be interesting to see how these investigations affect future mortgage lending and prospects for home ownership, and thus the homebuilding industry.

No Comments »