Twenty-three publicly traded home building companies face the challenge firms in every other sector, hot or not, deal with in today's economy. The challenge is a dual imperative: grow and generate income. Simple. And as Ronald Reagan has said, "There are simple answers, just not easy ones."
In 2015, our 23 publics accounted for 64.4% of our total closings among 200 firms we surveyed for our Builder 100/Next 100, tally of 261,372 total closings. By revenues, publics' share was even more impressive. In closing 168,326 homes, publics generated $65 billion in 2015, a lusty, round figure of 65.5% of total Builder 100/Next 100 revenue.
Here, from BUILDER associate editor Kayla Devon and the amazing research and editorial team at BUILDER, is a post-card line-up of year-over-year achievement by public home builders large and small.
You don't need no Pareto to know that publics' edge over the past couple of years--access to public debt and equity markets for capital to acquire, develop, and go vertical on home sites--has morphed into dominance. That clout is not likely to slow down as lots become tougher to pencil--laden as they are and will be with land use encumbrances, taxes, fees, obligations, remediations, accommodations, etc.--and fewer, more powerful players troll the deal-scape scarfing up the home sites in a flash, the moment they hit the market. Life as a private production home builder is stacking up to be a constant and growing challenge to be cleverer, better at sleuthing out the deals before they "go public," and far better at understanding home buyer customers (perhaps even better than they understand themselves).
Home building's moment right now rests squarely on top of "America's overriding economic problem," per Wall Street Journal contributor and Stanford University fellow John H. [no relation to the late Johnnie] Cochrane, which Cochrane identifies as "sclerotic growth."
So, let's summarize:
- America's got an economic growth problem
- Housing's got a public relations problem
- Public companies (and privately held firms) have a growth and income problem
- Young adults have a where-they-can-afford-to-live problem
- Communities have a how-they'll-pay-for-themselves problem
So, maybe we'd agree with the late President Reagan here:
"There are simple answers, just not easy ones."