Mattamy Homes, the Canadian private home builder that has been on an aggressive expansion drive in the Southeastern U.S. and Arizona, On Tuesday announced it is fleeing the state of Minnesota, with the exception of one still-under-development community. The rest of its land holdings, which were not identified by the company in its announcement, will be sold to CalAtlantic Homes and M/I Homes, both of which have a significant presence in the state.
Mattamy said that subject to a 45-day due-diligence period, the initial purchases under the contract are expected to close in April 2017, followed by additional takedowns of lots over the next three years, in accordance with the terms of the option agreements, with total expected purchases comprising all land currently held by Mattamy in Minnesota with the exception of the Lino Lakes development.
The company web site lists seven active communities in Minnesota in addition to Lino Lakes and two communities “coming soon.”
“Minnesota was Mattamy’s first expansion outside the Greater Toronto Area, and over time has produced solid results for the company,” said Peter Gilgan, Founder & CEO of Mattamy Homes. “However, Minnesota is not a long-term strategic fit for Mattamy’s business in the US, as it doesn’t align well in terms of our geographic focus. CalAtlantic Homes and M/I Homes both have a much larger presence in the Midwest, and should benefit from the economies of scale afforded by this concentration.”
Mattamy will reinvest proceeds from the transaction in land purchases in existing or new markets, in line with the company’s business goal of doubling the size of its US business over the next five years.
Mattamy will continue to develop unfinished lots as part of the agreement, and will continue to build and service the homes of its current customers.
