While many builders are tiptoeing carefully into the second half of the year, Royce Builders is intent on expansion. Currently active in the ultracompetitive markets of Houston, Dallas, and Atlanta, the company, which focuses primarily on the entry-level market, now has a significant foothold in Charlotte, N.C.
In mid-April, the company went head-to-head with everyone from C.P. Morgan to local builders to acquire 548 lots in four active communities after Charlotte-area builder and developer Dan Mossier passed away. According to Shonna Speer, senior vice president at Royce, the company also purchased Mossier's plans to ensure the design will be reflective of the Charlotte market. However, she does predict some modifications to the entry-level, single-family product. Construction began in July on homes that will range from 1,100 to 2,200 square feet and will be priced from $140,000 to $180,000.
Initially, the North Carolina operations were to be run as a satellite market under Royce's Atlanta division. But, because it was set to make inroads in the state, Speer was tapped to be the Charlotte division president. “As we build out communities, we will be actively seeking replacement communities and additional communities to increase our market share,” she says. “Once we establish ourselves, we will continue to explore other markets in the Carolinas. Clearly, Raleigh is a strong market with excellent opportunity as well. At this point, we are leaving all possibilities open.”
In addition, the company also is moving into the San Antonio market this month after acquiring a position of 84 lots in one active subdivision. But, as in Charlotte, the company is pursuing other deals for future purchases.
Speer predicts the company will close on 2,500 homes in 2006, up 33 percent from the 2005 figure of 1,690. “We're more of a strategic planning company,” she says of the expansion.