Big Buyers: D.R. Horton, Arlington, Texas

D.R. Horton is one of the most acquisitive builders in the industry, picking up 17 companies since 1994 from Hawaii to Florida. But three deals stand out in CEO Donald Tomnitz's mind: Continental Homes in 1998, Cambridge Properties in 1999, and Schuler Homes in 2001.

Merging with Continental "put us in the big leagues purchasing-wise," Tomnitz says, pushing Horton's volume to 14,000 closings in 1998. "That's when we had the volume for national purchasing to realize efficiencies." Cambridge represents a "sentimental" favorite for the CEO: Horton's share price fell during the acquisition process, but the sellers agreed to postpone the stock-based deal until Horton values rose, rather than selling to another builder. As for Schuler, "that put us over the top," Tomnitz says, as the combined company delivered 31,584 homes last year, making it the largest home builder in the country, based on U.S. closings.

Revenue has climbed as well. In 2002, Horton generated $7.3 billion, resulting in a three-year compound annual growth rate of 40.1 percent. But the company's penchant for acquisitions has gotten Horton in trouble with stock analysts, who'd prefer to see more internal growth at the Arlington, Texas-based builder. "I'm really indifferent about whether we do it internally or externally," says Tomnitz, who says that since 1994, the company's growth has come half from operations and half from acquisitions. Still, the company nodded to the organic growth pressure, promising to provide 20 percent earnings-per-share growth in 2003 without acquisitions.

Donald Tomnitz
Donald Tomnitz

Horton's internal growth strategy: market domination. The company is already among the top five builders in 70 percent of its markets, but division presidents receive bonuses if they land in a market's top five builders, occupy the No. 1 spot, or capture double-digit market share. "We don't want them resting on their laurels," says Tomnitz.

While the home building industry remains fragmented, Tomnitz says that the rise of the mega-builders has changed some of the attitudes about growth and the potential size of a home building company. "I think most people thought a home builder doing 20,000 units a year would implode. I don't think they thought there was a corporate structure to support it," he says. "Now they're talking about a 50,000-unit builder or a 100,000-unit builder."

Rankings

Rank Company/Address % Gross Revenue Change 2000-2002* 2002 Gross Revenue** % Closing Growth From 2000-2002 2002 Closings (What They Build) Year Founded No. of Employees
Key: EL = Entry-level, MU = Move-up, LUX = Luxury/Custom, AA = Active adult, SEC = Second home
*Revenue change = the compounded annual growth rate over three years. **In millions
1

Anderson Homes

335 Water St.
Wilmington
DE
19804

900% $50 17,100% 172
EL, MU
2000 65
2

Kara Homes

197 Rt. 18
E. Brunswick
NJ
08816

258.8% $103 1,600% 289
EL, MU, LUX, AA, SEC
1999 155
3

Shamrock Construction

2160 E. Lemon Creek Rd.
Berrien Springs
MI
49103

139.4% $2 -20% 14
EL, MU
1993 3
4

Dana Dugas Affordable Homes

P.O. Box 11310
New Iberia
LA
70562

133.4% $2 267% 22
EL, MU, SEC
2000 3
5

Town & Country Home Builders

201 S.W. Port St. Lucie Blvd.
Port St. Lucie
FL
34984

107% $3 250% 21
MU, LUX, SEC
1998 10
6

Pageantry Cos.

1333 N. Buffalo Dr.
Las Vegas
NV
89128

94.9% $76 287% 410
EL
1994 95
7

Homes By Kennedy

600 W. Hillsboro Blvd.
Deerfield Beach
FL
33441

89.2% $68 245% 441
EL, MU, AA, SEC
1997 53
8

Lowell Homes

80 S.W. 8th St.
Miami
FL
33130

81.5% $56 85% 222
EL, MU, LUX
1987 35
9

Transeastern Properties

3300 N. University Dr.
Coral Springs
FL
33065

73.5% $295 103% 1140
EL, MU, AA
1986 210
10

Dunmore Homes

2150 Professional Dr.
Roseville
CA
95661

72.1% $160 100% 577
EL, MU
1953 135
11

Keystone Homes

924 Stevens Creek Rd.
Augusta
GA
30907

67.3% $28 172% 215
EL, MU
1995 23
12

Vantage-Raylee Homes

4131 Barbara Loop
Rio Rancho
NM
87124

65.3% $41 225% 273
EL, MU, LUX
1976 40
13

Syncon Homes

2221 Meridian Blvd.
Minden
NV
89423

60% $87 106% 303
EL, MU, LUX
1995 55
14

Joseph Douglas Homes

19435 W. Capitol Dr.
Brookfield
WI
53045

54.9% $12 76% 37
MU, SEC
1999 9
15

Ole South Properties

275 Robert Rose Dr.
Murfreesboro
TN
37129

53.8% $71 131% 627
EL
1987 34
16

World Development

44600 Village Ct.
Palm Desert
CA
92260

53.5% $33 49% 58
EL, MU
1997 45
17

Hovnanian Enterprises

10 Hwy. 35,
Red Bank
NJ
07701

49.7% $2551 118% 9514
EL, MU, LUX, AA
1967 500
18

Ginsburg Development Corp.

245 Saw Mill River Rd.
Hawthorne
NY
10532

49.5% $114 131% 268
MU, LUX
1964 164
19

Meritage Corp.

8501 E. Princess Dr.
Scottsdale
AZ
85255

46.7% $1120 105% 4574
EL, MU, LUX, AA
1985 870
20

Lee Wetherington Homes

6009 Business Blvd.
Sarasota
FL
34240

44.6% $69 90% 190
MU, LUX, AA, SEC
1981 70
21

M.B.K. Homes

175 Technology Dr.
Irvine
CA
92618

44.5% $117 55% 310
EL, MU
1991 71
22

Centerline Homes

12534 Wiles Rd.
Coral Springs
FL
33076

44.2% $104 39% 418
EL, MU, LUX, AA
1994 87
23

Century Homebuilders

7270 N.W. 12th St.
Miami
FL
33126

44% $141 80% 855
EL, MU, SEC
1999 110
24

Legend Home Corp.

10410 Windermere Lakes Blvd.
Houston
TX
77065

42.2% $93 85% 587
EL, MU
1991 85
25

Orleans Homebuilders

One Greenwood Sq.
Bensalem
PA
19020

42% $361 67% 1282
EL, MU, LUX, AA
1920 367
26

Keystone Homes

3611 W. Swann Ave.
Tampa
FL
33609

41.4% $12 163% 42
EL, MU, LUX, SEC
1984 16
26

Main Street Homes

717 N. Courthouse Rd.
Richmond
VA
23236

41.4% $22 52% 93
MU, AA
1996 26
26

Patrick Malloy Communities

851 Cedar St.
Carrollton
GA
30117

41.4% $32 78% 158
EL, MU
1997 35
26

SeaGate Homes

185 Cypress Point Pkwy.
Palm Coast
FL
32164

41.4% $30 83% 262
EL, MU
1994 43
30

Elliott Homes

80 Iron Point Cir.
Folsom
CA
95630

41.3% $479 21% 1394
EL, MU, LUX
1955 176
31

Gehan Homes

1101 N. Union Bower Rd.
Irving
TX
75061

40.2% $173 79% 1090
EL, MU
1991 160
32

D.R. Horton

1901 Ascension Blvd.
Arlington
TX
76006

40.1% $7324 67% 31584
EL, MU, LUX, AA, SEC
1978 5000
33

Matthews Brothers Homebuilders

8134 Country Village Dr.
Cordova
TN
38016

39.5% $37 77% 253
EL, MU, AA
1997 27
34

Town & Country Homes

1806 S. Highland Ave.
Lombard
IL
60148

39% $290 80% 1350
EL, MU
1958 318
35

Mercedes Homes

6767 N. Wickham
Melbourne
FL
32940

37.8% $575 59% 3066
EL, MU, SEC
1985 1086
36

Essex Homes Southeast

4458 Augusta Rd.
Lexington
SC
29073

37.4% $17 74% 80
EL, MU
1993 17
37

Holiday Builders

2293 W. Eau Gallie Blvd.
Melbourne
FL
32935

35.5% $235 61% 2114
EL, MU, AA
1983 250
38

Brownstone Homes

12670 S.W. 68th Ave.
Portland
OR
97223

35.4% $22 46% 120
EL, AA
1987 12
39

Southern Homes of the Upstate

108 Ole Towne Sq.
Central
SC
29630

35% $31 89% 268
EL, MU, LUX, SEC
1989 50
40

Woodside Group

3855 S. Jones Blvd.
Las Vegas
NV
89103

34.9% $641 39% 2491
EL, MU, LUX
1977 388
41

Kalian Corp.

225 Hwy. 35
Red Bank
NJ
07701

34.3% $119 107% 749
EL, MU, AA, SEC
1986 46
42

Beazer Homes USA

5775 Peachtree Dunwoody Rd.
Atlanta
GA
30342

34.2% $2852 82% 14720
EL, MU, LUX, AA, SEC
1985 2905
43

Bowen Family Homes

4460 Commerce Dr.
Buford
GA
30518

33.5% $173 63% 951
EL, MU, AA
1993 100
43

Realen Homes

1040 Stony Hill Rd.
PA
19067
0.33498247846995438

18000% $0.45 54700% 1968
120 EL, MU, LUX, AA
45

Century Vintage Homes

1535 S. D St.
San Bernardino
CA
92408

33% $168 45% 655
EL, MU, LUX, SEC
1962 118
46

Gateway Homes

10255 Richmond Ave.
Houston
TX
77042

32.6% $58 57% 407
EL, MU
1990 55
47

Sotherby Homes

4975 Preston Park Blvd.
Plano
TX
75093

32.3% $56 71% 188
MU
1995 50
48

Amber Homes

14901 E. Hamden Ave.
Aurora
CO
80014

31.7% $26 51% 157
EL, AA
1998 38
49

Parkside Homes

1600 Specht Point Dr.
Fort Collins
CO
80527

31.2% $31 42% 185
EL, MU
1996 18
50

Highland Holdings

4110 S. Florida Ave.
Lakeland
FL
33813

30.4% $51 27% 372
EL, MU, AA
1996 35
50

McDaniels Homes

9470 Annapolis Rd.
Lanham
MD
20706

30.4% $17 46% 60
EL, MU, LUX
1995 13
52

Bosgraaf Homes

301 Douglas Ave.
Holland
MI
49424

29.9% $27 49% 121
MU
1985 30
52

Essex Homes of Western New York

8940 Main St.
Clarence
NY
14031

29.9% $27 51% 77
EL, MU, LUX
1992 25
54

Southern Engineering Corp.

7501 Wisconsin Ave.
Bethesda
MD
20814

29.1% $10 67% 25
MU
1951 10
55

Renaissance Custom Homes

1672 S.W. Williamette Falls Dr.
West Linn
OR
97068

28.7% $48 43% 136
MU, LUX, AA
1984 40
56

Carefree Homes

1560 Goodyear St.
El Paso
TX
79936

28.1% $41 46% 356
EL, MU
1990 16
57

ICI Homes

2359 Beville Rd.
Daytona Beach
FL
32119

27.1% $218 19% 767
MU, LUX, AA, SEC
1980 158
58

Pasquinelli Construction Co.

6880 N. Frontage Rd.
Burr Ridge
IL
60527

26% $381 39% 2004
EL, MU, LUX, AA
1956 341
59

McBride & Son Enterprises

1 McBride Center Dr.
Chesterfield
MO
63005

25.6% $292 73% 1098
EL, MU, LUX
1946 940
60

Pinnacle Homes

5768-B Miller Ct.
Columbus
GA
31909

25.4% $11 31% 81
EL, MU
1997 11
61

Astoria Homes

9555 Del Webb Blvd.
Las Vegas
NV
89134

25.1% $122 38% 568
EL, MU
1995 115
62

Park Square Homes

5200 Vineland Rd.
Orlando
FL
32811

24.3% $122 37% 546
MU, LUX, SEC
1984 110
63

Ball Homes

3399 Tates Creek Rd.
Lexington
KY
40502

24.2% $148 38% 949
EL, MU
1958 140
64

Dominion Homes

5501 Frantz Rd.
Dublin
OH
43017

22.8% $492 44% 2591
EL, MU
1946 562
65

Bryant Building Co.

P.O. Box 876
St. Cloud
FL
34770

22.5% $3 88% 15
MU
1987 2
65

Stillbrooke Homes

8901 Adams N.E.
Albuquerque
NM
87113

22.5% $33 38% 148
EL, MU, LUX, SEC
1997 28
65

Whitestone Custom Homes

1017 N. Central Pkwy.
San Antonio
TX
78232

22.5% $12 27% 42
MU, LUX
1998 12
65

Woodland Homes of Huntsville

7545-A Hwy. 72 W.
Madison
AL
35758

22.5% $18 26% 68
MU, LUX
1995 23
69

The Drees Co.

211 Grandview Dr.
Fort Mitchell
KY
41017

21.7% $838 31% 2746
EL, MU, LUX
1928 930
70

Michael Crews Development

P.O. Box 300429
Escondido
CA
92030

21.5% $31 25% 65
MU
1979 82
70

Neumann Homes

4355 Weaver Pkwy.
Warrenville
IL
60555

21.5% $248 21% 1156
EL, MU
1992 280
72

Royce Homes

7850 N. Sam Houston Pkwy. W.
Houston
TX
77064

21% $347 23% 1604
EL, MU, LUX
1984 320
73

Southern Homes of Polk County

2000 E. Edgewood Dr.
Lakeland
FL
33803

20.9% $19 59% 165
EL, SEC
1991 21
74

Tadian Homes

2038 W. Big Beaver
Troy
MI
48084

20.6% $40 104% 161
EL, MU
1985 80
75

Fieldstone Communities

14 Corporate Plaza
Newport Beach
CA
92660

20.4% $293 20% 800
EL, MU
1986 165
76

TK Constructors

5141 W. Hessler Rd.
Muncie
IN
47304

20.3% $55 33% 513
EL, MU
1990 132
77

Belgravia Group

833 N. Orleans
Chicago
IL
60610

20.2% $39 12% 91
EL, MU, LUX
1989 12
77

GHO Homes

5670 Corporate Way
West Palm Beach
FL
33407

20.2% $13 40% 81
MU, AA, SEC
1983 27
77

Standard Pacific Corp.

15326 Alton Pkwy.
Irvine
CA
92618

20.2% $2050 62% 6265
MU, LUX, AA
1961 1359
80

Grand Homes

8350 N. Central Expwy.
Dallas
TX
75206

19.8% $191 23% 670
EL, MU, SEC
1986 241
81

Thompson Homes

981 S. Bolmar St.
West Chester
PA
19382

19.5% $30 93% 56
LUX, SEC
1975 20
82

G.L. Homes of Florida

1401 University Dr.
Coral Springs
FL
33076

19.3% $434 23% 1355
EL, MU, LUX, AA
1976 300
83

Forrest Homes

4040 Nine McFarland Dr.
Alpharetta
GA
30004

18% $32 43% 251
EL, MU
1998 39
84

The Hamlet Cos.

308 E. 4500 S.
Murray
UT
84107

17.8% $43 28% 287
EL, MU
1994 61
85

The Villages of Lake-Sumter

1100 Main St.
The Villages
FL
32159

17.6% $463 27% 2260
AA
1959 2220
86

WCI Communities

24301 Walden Center Dr.
Bonita Springs
FL
34134

17.5% $1218 -7% 1699
MU, LUX, AA, SEC
1946 3000
87

NVR

7601 Lewinsville Rd.
McLean
VA
22102

16.3% $3136 13% 11368
EL, MU, LUX
1987 3334
88

Hometowne Building Co.

37000 W. 12 Mile Rd.
Farmington Hills
MI
48331

16.1% $58 37% 163
EL, MU
1995 58
89

Lakewood Homes

2500 W. Higgins Rd.
Hoffman Estates
IL
60195

15.9% $258 22% 1250
EL, MU, LUX, AA
1990 134
90

Choice Homes

1600 E. Lamar Blvd.
Arlington
TX
76011

15.5% $467 23% 3879
EL, MU
1987 375
90

Cullum Homes

8408 E. Shea Blvd.
Scottsdale
AZ
85260

15.5% $12 -38% 5
LUX
1985 36
92

Lennar Corp.

700 N.W. 107th Ave.
Miami
FL
33172

15% $7320 21% 27393
EL, MU, LUX, AA
1954 7700
92

M.D.C. Holdings

3600 S. Yosemite St.
Denver
CO
80237

15% $2319 19% 8900
EL, MU, LUX
1972 2250
94

Venture Homes

1580 Terrell Mill Rd.
Marietta
GA
30067

14.6% $63 9% 302
EL, MU
1984 90
95

MHI

7676 Woodway
Houston
TX
77063

14% $520 23% 2715
EL, MU
1989 400
96

Morrison Homes

3700 Mansell Rd.
Alpharetta
GA
30022

13.5% $806 19% 3197
EL, MU, AA
1978 675
97

Toll Brothers

3103 Philmont Ave.
Huntingdon Valley
PA
19006

13.3% $2329 12% 4430
MU, LUX, AA, SEC
1967 2960
98

Great Western Homes

3850 E. Baseline Rd.
Mesa
AZ
85206

13.2% $100 53% 742
EL, MU, AA
1995 75
98

Iverness Group

11305 Reed Hartman Hwy.
Cincinnati
OH
45241

13.2% $50 32% 282
EL, MU, AA
1994 55
100

Hallmark Communities

10675 Sorrento Valley Rd.
San Diego
CA
92121

11.8% $20 4% 56
EL, MU, LUX
1984 38
100

Woodstock Building Associates

78 Prospect St.
Woodstock
CT
06281

11.8% $5 50% 12
MU
1978 26

Learn more about markets featured in this article: Houston, TX, Dallas, TX, Los Angeles, CA, Atlanta, GA.