WCI Anticipates Accounting Change The home building market's recent souring has hit few companies as hard as WCI Communities. With new orders for its traditional home building operations down roughly 43 percent and orders for its tower operations off 82 percent in the second quarter, the Bonita Springs, Fla.–based company's future financial reports appear bleak.
But the Financial Accounting Standards Board's Emerging Issues Task Force is considering a way to give developers, such as WCI, more flexibility in their financial reporting. Currently developers of tower projects are required to report revenues by a percentage-of-complete method. However, because individual units in condominium projects are sold separately, officials are discussing whether that regulation should change.
Although no official announcement has been made, if the group's preliminary conclusion is enacted, developers such as WCI will have a choice as to how to report financial results. If they choose to report revenues using the percentage-of-completion method, they must collect additional deposits from buyers. Otherwise, the companies can delay the financial reporting of revenues on a project until the closing of condominium purchase contracts. The change is expected to be in place by January 1, 2008.
Crosswinds Commits to AZ Crosswinds National, a sister company to Novi, Mich–based Crosswinds Communities, isn't daunted by the real estate bubble bursting in the Phoenix area. The company, which focuses on land acquisition for master planned communities, home building, commercial, and mixed-use development, is opening its new Western division there. The company currently owns roughly 6,000 single-family lots in Phoenix and also intends to launch a home building division in town.
Inventory Reprieve HER Real Living is helping builders in central Ohio move standing inventory. The company has launched a Web site to match buyers with the sellers of completed but unsold new homes.
The database, which allows shoppers to peruse models at various developments in the area, contains nearly 2,100 unsold homes from 15 regional builders, including Dominion Homes and Rockford Homes. The company expects to roll the service out to out cities soon.
Clarification In the article “Global Cash, Local Cache,” in the September 1 issue, Phil Nowick and Nick Tramontana were listed as working for Michael P. Kahn & Associates. However, during the time the issue was at the presses, the two left the firm and now work for PNT Capital Advisors, a specialty investment bank for home builders.
Executive Moves John Laing Homes' San Diego division names Josh DeGroot as its new land acquisition manager.
In this position, he will focus on enhancing the builder's portfolio in the area, identifying opportunities, conducting financial analysis, and negotiating purchase agreements.
Atlanta-based John Wieland Homes and Neighborhoods has a new president of its financial services. Keith Fadeley will take over as president of Wieland Financial service, the builder's mortgage banking division. The 20-year-old subsidiary generates more than $300 million in mortgage loans per year.
Also in the Atlanta area, Sivica Communities hires a new controller. Former Centex Homes employee Sara Hendrickson will develop budgets and forecasts, supervise the accounting department, and oversee the company's financial controls and processes.
Buena Vista Custom Homes continues its hiring trend. Tom Cockerill joins the growing builder as operations manager for the office Bend, Ore. He will manage Realtor and subcontractor relationships, negotiate with the city, and coordinate permitting activities.
Also for Buena Vista Custom Homes in Bend, Tammy Davis is hired as the office's controller.