As 2012 clocked to a close, a behemoth builder was created in Pittsburgh. NVR, the largest builder in town, bought Heartland Homes, the second biggest. Together they account for more than half of the new-home market.
As nod to Heartland’s impressive brand recognition in the market, the Reston, Va.–based NVR will continue to market homes under the Heartland name. The two companies are complementary because NVR’s Ryan Homes brand serves mostly first-time and first-time move-up buyers while Heartland’s market is the higher-end discretionary buyer. It also builds on buyers’ own lots.
The two companies also have similar business models. Both are “asset light,” pre-selling homes before building them and buying lots as they need them from developers rather than developing them themselves.
The merger, announced by NVR in a news release and Securities and Exchange filing, gives Heartland the ability to grow within the Pittsburgh market, something NVR said in the release that it intends to do. Currently Heartland is building in 36 communities in the Pittsburgh area, one community in Monongalia, W.V., and one community in Raleigh, N.C.
The two companies have a familial connection as well. Heartland was founded in 1984 by Alan “Gus” Gillespie, the son-in-law of the late Ed Ryan, founder of Ryan Homes in 1948. Gillespie’s son Martin Gillespie became president of Heartland Homes in 2005 and will continue to manage the Heartland business.
Heartland closed 400 homes in 2012. NVR doesn’t divulge its sales numbers for individual markets. Builder’s Local Leaders Rankings for 2011 showed the two builders closed 1,401 homes in the Pittsburgh market in that year, nearly 60% of the market.
Neither Heartland nor NVR immediately returned Builder’s calls requesting more information about the merger.
Teresa Burney is a senior editor for Builder magazine.