Avatar Holdings has hired a new president and chief executive officer to replace long-time CEO Gerald D. Kelfer, who is retiring.
Jon M. Donnell, 51, a veteran real estate executive who has worked at both Del Webb and Dominion Homes, will start work at the Coral Gables, Fla.-based company on November 15. Kelfer, 65, will remain as vice chairman of the board and a director at Avatar.
Currently, Donnell is a principal at The Monticello Group, a real estate advisory firm based in Sarasota, Fla. Donnell co-founded Monticello, which specializes in helping lenders with distressed real estate assets. Donnell said he will be winding down that company.
"I'm excited about the company," Donnell said in an interview. "I'm excited about its (real estate) portfolio of assets. I'm excited to get to know the team. And I'm really excited about the active adult community element."
Donnell said he is particularly impressed with Avatar's land assets because "There is a good mix of legacy assets as well as some recently acquired assets."
Donnell has more than 20 years of experience in home building, land development, and with active-adult communities, which is a prime focus for Avatar. He worked in several senior-level finance and operational positions at Del Webb Corp. between 1984 and 1995 including design, development, sales, construction, and finance at Sun City Las Vegas and Sun City Hilton Head.
Dominion Homes recruited Donnell from Del Webb. He worked there from 1995 to 2004, first as chief financial officer and later as the firm's president and chief operating officer.
"During his tenure at Dominion, the company achieved significant growth and dramatically improved its profitability and market share," the news release said. He left that company four years before it was downsized and taken private by creditors.
Donnell's diverse experience was a major attractor for Avatar's current leaders. "He possesses a unique blend of experience, a time-tested track record, and leadership skills in the most critical segments of Avatar's business--active adult communities, land development, and home building," Joshua Nash, chairman of the Avatar board, said in the announcement. "This is a rare combination that we believe will serve Avatar well as it navigates through this economic environment."
"At the same time, the board wants to recognize the long-term accomplishments and express its deepest appreciation to Gerry Kelfer, whose leadership has been so important in building Avatar into the company it has become since he joined it in 1997," said Nash. "We look forward to Gerry's continued involvement as a valued director."
"In Jon Donnell we gain a very talented executive with a proven track record in building and growing real estate companies in different market cycles," said current CEO Kelfer in the announcement. "I'm stepping down with the confidence that our new CEO is the right leader for Avatar going forward and, along with my fellow directors, fully support him."
Kelfer added: "I am proud of Avatar and all that we have achieved over the past 14 years. Now is the time to look to the future and put in place new leadership that will take us to the next phase of growth."
Avatar, which specializes in building "lifestyle communities" primarily in Florida, but also in Arizona, has been hit hard by the housing recession. Sales have slowed seriously, and the company reported a $16.1 million loss in the first half of 2010. The focus has been on preserving cash and reducing overhead. At the same time, it has been looking to capitalize on the lower land costs to prepare itself for the market turnaround.
Last June, Avatar bought 1,064 residential lots in Tortosa, a community in Maricopa, Ariz., about 35 miles southeast of Phoenix for $5.7 million. In August in acquired 368 home lots in Turtle Creek, a planned development in St. Cloud, Fla., for $7 million.
And a year ago, Avatar bought 87 completed and partially completed homes as well as 267 developed lots and 400 undeveloped lots in a former Levitt community called Seasons at Tradition in St. Lucie County, Florida. Since then, the company reported in August that it had contracts for 47 sales with a dollar value of $7.5 million in the community at the end of June as well as 42 closings with a total dollar value of $6.8 million.
Avatar also has a substantial cache of land that it has held for many years. In total, it owns 16,000 acres plus minority ownership in another 830 acres of developed, partially developed, or developable residential commercial and industrial property.
It also owns another 15,000 acres of preserves, wetlands, open space and other areas that are not developable, permitable, and/or economically feasible to develop land in Florida and Arizona.
Avatar shares were up nearly 1% at $19 on the day while the bulk of the public home builder group suffered losses.
Teresa Burney is a senior editor for BUILDER and BIG BUILDER magazines.