Even as pockets of the Phoenix residential real estate market--particularly for finished home lots at dramatically repriced levels--continue to show the first faint signs of a pulse, home builder operators are hunkered down for a tough go of it for the foreseeable future in an embattled economy and a glutted supply of homes for sale. Especially, private home builders.
Kevin Egan, T.W. Lewis president and COO since 2004, announced that he will leave the company, effective March 1. The move, driven by a need to preserve cash as a harsh outlook for new-home demand continues to bedevil Phoenix's new-home market beyond visible limits, was Egan's own decision. Egan's choice to step down echoes that of other high-level private home building company executives--e.g., Melbourne, Fla.-based Holiday Builders' Kim Shelpman last April, and, in August 2008, CEO Tom Eggleston resigned from Indianapolis-based now-defunct home builder C.P. Morgan--who've chosen to identify themselves as a cost savings amid a housing recession that has probably reduced corporate and field associate ranks among home builders by as much as 60% to 70%.
"Tom [Lewis] is more engaged on a day-to-day basis here," Egan told Big Builder as he announced his plans to start his own consultancy, Egan Ventures, while he explores full-time opportunities in Arizona and Texas, where he served until 2004 as COO at Dallas-based Darling Homes. "We really didn't need a president these days," Egan said, noting that T.W. Lewis had shrunk from 140 employees two years ago to a current 38. "There's a lot we've learned as we've sized ourselves to the diminished demand. I feel that the [T.W. Lewis] company's culture, and attitude, and operational execution is where it needs to be. It's time for me to move on."
"Kevin was here for six years, from the boom times to when it started to get ugly," said Tom Lewis, T.W. Lewis founder and owner. "He led our organization to new heights in quality--we were winners of the National Housing Quality Award--and he created a strong team organization. It's always hard to get people in different departments to work well together, and he was masterful at that. He created an incredible cooperative culture here. We'll miss that."
T.W. Lewis ranked 20th among Phoenix area home builders in 2009 permits, according to R.L. Brown data compiled by Land Advisors Organization, with 1.1% of a total 8,000 permits in the market. That's down from a peak in 2006 of better than 60,000 permits and is expected to increase only marginally over the next two years from 8,500 in 2010 to 13,000 in 2011.
Learn more about markets featured in this article: Phoenix, AZ.