Orleans Buys Realen
Orleans Homebuilders acquired Realen Homes for $60 million—$55 million in cash and a $5 million purchase money note. Orleans, which builds in Pennsylvania, New Jersey, North Carolina, South Carolina, Virginia, and Florida, will now expand its presence in Pennsylvania and the greater Chicago market.
Realen delivered 429 homes in 2003, generating revenues of $145 million. With this acquisition, Orleans' company-wide revenues are expected to exceed $800 million in 2005.
Barratt American's management team signed an agreement last month to acquire the company from its British-based corporate parent, Barratt Developments, for $165 million. The privately held company will maintain the name Barratt American, and will keep the same management, headquarters in Carlsbad, Calif., and full project and land inventory in Southern California. Barratt Developments will now concentrate on the United Kingdom, where it is the largest home builder. Michael Pattinson, president of Barratt American, said that the transaction would allow Barratt American to continue its strong growth. Its fiscal year ended June 30 with record sales of 702 residential units and $305 million in revenue.
KB Back To Home Turf
Los Angeles-based KB Home is returning to its roots in Orange County. KB, formerly the county's market leader, sold only four homes there during the first half of 2004. The builder didn't replenish its supply of land quickly enough as its homes sold, according to Jay Moss, president of KB's greater Los Angeles and Orange County divisions. KB is negotiating to buy land throughout the county.
It hasn't been easy finding “work-force housing” solutions that actually work. Community demands for affordable workforce housing often remain at odds with the challenges of impact fees, zoning impediments, and the need for builders and developers to turn a profit. Harvard University, which recently published a major study on the topic through its Joint Center for Housing Studies, is trying to help. It's design school is conducting a three-and-a-half day case-study program for public and private sector managers to tackle the issues surrounding work-force housing. The session will be Nov. 30 to Dec. 3 at Harvard University in Cambridge, Mass. Admission is $2,500 for private sector managers and $2,250 for nonprofit managers. Visit www.gsd.harvard.edu/execed and click on “Admissions Programs.”
Learn more about markets featured in this article: Los Angeles, CA.