Meritage Homes has staked a claim on the Nashville, Tenn. market, buying Phillips Builders, the ninth largest builder in Nashville with 100 closings last year, according to BUILDER’s annual Local Leaders list. The purchase price was not disclosed.
"The acquisition of Phillips Builders provides Meritage with a successful operation, respected management team, and valuable asset position in the strong and growing Nashville market," Meritage CEO Steven J. Hilton said in a news release. “This is our fourth expansion market in the last two years and is consistent with our strategy to enlarge our southeast region.”
The purchase gives Meritage access to some 500 lots in Nashville and between 150 and 200 home closings in 2014. Meritage Homes will operate under the Phillips Builders brand name, and Jason and Charlie Phillips, grandsons of founder Randall Phillips Sr., will continue to manage the company, which began in 1952.
"It’s standard acquisition MO,” says Brent Anderson, Meritage’s vice president of investor relations. “We provide the capital and administrative and corporate reporting under their management team, their brand name, and their relationships to grow the market.”
Phillips Homes was bought at one time by Beazer Homes, which stopped building under the Phillips name after Eddie Phillips, the son of the founder, retired in 2003. Eddie’s sons worked for Beazer before they each started their own home building companies. They later joined forces to restart Phillips Homes, said Anderson.
Meritage approached several other Nashville home builders before striking a deal with Phillips, Anderson said. “[Nashville] fits real well with that kind of move up market (Meritage specializes in); not entry level, not the high end,” Anderson explained.
Teresa Burney is a senior editor for BUILDER.