Tim Eller was named chairman and CEO of Centex Corp. in 2004, two years after becoming president and COO. Dallas-based, publicly owned Centex is the fourth largest U.S. builder. Operating in two dozen states, the company delivered 33,000 homes in fiscal '05. For fiscal 2006, the projected third-quarter revenues for Centex are $3 billion, 34 percent higher than a year earlier.
With Centex since 1973, the 57-year-old Eller, who is married with three children, is a recipient of the “Legends of the Industry” award.
BB: On the new Fed leadership, can you speculate on what the change from Alan Greenspan to Ben Bernanke will mean for the industry?
TE: What I go by is what he said in his confirmation hearing. It appears he is well prepared, knows what he wants to do, and it looks very much in sync with what Alan Greenspan did.
BB: You predict a return to “more normal” levels of new-home sales and price appreciation. In fact, some suggest the industry is in a boom-bust mode. Your reaction?
TE: If you look back over the past 15 years, that is not the case. Fifteen years is an awfully long time to have a very steady industry performance.
TE: I don't think so. We certainly are instituting some sales promotions to kick off the selling season, but these are planned promotions that we have had in the works for a number of months.
BB: You argue that long-term fundamentals for the industry remain strong. What is the most convincing evidence?
TE: Demographics. Baby boomers aging into their prime income years, their pre-retirement years. They're going to be making housing choices with their wealth and their lifestyle choices, and their children aging into their first-time buying years. These are powerful demographic forces, along with immigrants who have been entering this country during the past 20 years.
BB: Let's talk land. Is it a fine line between a company having the land it needs and owning too much?
TE: We are all focused on returns. That metric by itself will dictate our land position. It really hasn't changed much over the past 10 years. Our land ownership position has been very consistent at about a two-year supply.
BB: Your company has dedicated itself to saving thousand of acres of critical habitat. Are we doing enough for land preservation?
TE: We are doing maybe more than any other country. I am proud of what we're doing and how we're working in partnership with others that are really focusing on saving special places.
BB: What do you do to relax?
TE: I enjoy skiing and golfing with friends and family in the mountains of Colorado.
BB: Your choice of international destinations?
TE: We tend to go to France more often than anywhere else. Typically, Paris or the South of France.
BB: You were on the executive committee of the Dallas opera. Is opera relaxing for you?
TE: I enjoy that. I enjoy all types of music.
BB: A favorite opera?
BB: You have three grown children. Anyone following your footsteps?
TE: One is. He is actually working for another large builder in California and enjoying the experience immensely. That is John. He is 27.
BB: If we were doing this interview a year from now, what do you suppose we'd be talking about?
TE: I believe we would talk about how good the home building market was after it went through its transition of normalizing earlier in the year. I think we would talk about a very strong, robust housing market that operated at a more normal level, but—nevertheless—a very strong level.