Builder honored PulteGroup and DSLD as the fastest-growing public and private home builders in 2011 during the 26th annual Builder 100 Awards presentation in New York on May 15. Both companies were recognized for their compound annual growth rate over a three-year period.
Though the phrase "fastest-growing home builder" may seem like an oxymoron—especially among public companies, which have reported record losses during the last four years—some would say it was easy for PulteGroup to become the fastest growing public builder. All it had to do was merge with Centex in late 2009. But the deal was the easy part; integrating the two companies’ operations smoothly, while maintaining growth, was the real feat.
Integration wasn’t the only difficult task undertaken by Bloomfield Hills, Michigan-based PulteGroup. The company also changed long-time business practices to increase its profitability. It increased its gross profit margins every quarter in 2011, and by the fourth quarter, it logged an 18.5% adjusted gross margin—its highest in five years.
"PulteGroup had the courage to abandon old business models that had stopped working," said Denise Dersin, Builder’s editor in chief. "It also instituted and embraced new practices that have made the company more agile, competitive, and profitable."
At a time when most builders have struggled just to keep their heads above water, Louisiana-based fastest-growing private builder DSLD has grown consistently since launching in the summer of 2008. Using an operational blueprint from his previous company, principal Saun Sullivan executed a strategy that relies on making sure product is available when customers want to buy. That strategy is driven by even-flow construction (DSLD’s cycle times have been as low as 45 days), and fearlessly maintaining spec inventory.
"Price, quality, and scheduling are what separates DSLD from its competitors in Louisiana and Mississippi," said Dersin. That formula has allowed the company to greatly expand its market reach from 20 communities at the end of 2009 to 51 by mid-April of this year. Its geographic growth was abetted by DSLD’s strategic alliance in 2010 with another local contractor, Vicknair Builders, which helped the combined company to generate an 89% increase in closings last year.
Builder’s fastest-growing public and private builders are chosen from the ranks of the Builder 100 list.