Following a pattern of steady growth since its founding in 2005, Arlington, Texas-based Wall Homes has entered into an agreement to acquire the majority of the assets of one of North Texas' Top 20 home builders.
CEO Steve Wall confirms that his company is in the process of acquiring the Dallas/Fort Worth division of Newmark Homes, a brand of TOUSA, Inc. (formerly Technical Olympic USA), including raw land, site developments, finished lots, and construction in process. With the acquisition, Wall Homes will increase its active neighborhoods in Texas to nearly 50 from 28.
Though Wall would not comment on the value of the transaction, which is anticipated to close on May 31, he did say that the acquisition was made at a substantial discount. TOUSA estimates a gross sales price of $55.7 million from the transaction, and, according to a TOUSA SEC filing, the company expects the sale to generate a pre-tax loss of $11.7 million.
"This is an amazing opportunity for Wall Homes," said Steve Wall. "Newmark parallels Wall's market focus and dedication to customer service and satisfaction. With the acquisition, we begin our third year in business at twice the size we were at the end of our second year. It's a great fit."
In the DFW area, Newmark's 28 communities feature homes with prices ranging from $126,000 to $400,000. Existing Wall neighborhoods in Dallas, Fort Worth, Houston, Austin, and San Antonio offer a single-family detached and attached homes priced from the $120s to the $500s.
In his company's earning call on May 10th, TOUSA CEO Antonio Mon said, "the decision to sell our Dallas division is part of the execution of our asset management strategy and will enable us to sharpen our focus on gaining share in the other Texas markets where we have been more profitable." The company also builds under the Newmark name in the Texas markets of Houston, Austin and San Antonio as well as Nashville, Tenn. This sale does not affect any other divisions.
According to a Wall Homes spokesperson, the company is currently conducting staff evaluations and considering reassignment of Newmark employees within the expanding Wall organization.
Learn more about markets featured in this article: Dallas, TX.