In a bid to shake their cyclical reputation, a handful of public builders have revived a nonprofit group initially established in 2000--the Public Home Building Council of America (PHBCA)--with a broader membership and message. Thirteen builders, including Pulte Homes, Toll Brothers, Centex Homes, D.R. Horton, and others, have joined the group, each paying $100,000 in dues for the first year.
"We really need to develop a voice for the large public builder," explains Neil Devroy, vice president of communications and public affairs for Centex Homes. He says the big public builders face different issues than the rest of the home building industry, which is typically composed of small, privately owned firms.
While fluctuating interest rates and skyrocketing lumber prices can whipsaw local builders, public builders contend they are insulated from the dramatic ups and downs of home building by virtue of their geographic diversity, access to lower-priced public capital, efficiencies of scale in their operations, and increasingly sophisticated systems.
"We are more like consumer products companies in that we are not necessarily affected by cyclical factors," Devroy says.
The NAHB agrees that public builders face different issues than do their smaller counterparts. "They're a different segment of the industry," says Rob Pfleiger, NAHB senior staff vice president. "Large corporations do business differently." As such, the NAHB views the public builders' outreach efforts as a "positive development," says Pfleiger, with potential industry-wide benefits as the public builders share good news about today's home building industry.
The PHBCA plans to spread its message to industry watchers through a campaign designed by public relations firm Fleishman-Hillard, which plans to target national newspapers and business magazines as well as regional publications. The effort was expected to kick off at the International Builders' Show in January.