Carroll County-based Masonry Homes has been sold to national builder Technical Olympic USA Inc. for $28 million, executives said yesterday.
Masonry was the 12th-largest homebuilder in the Baltimore metropolitan area through September, according to the Meyers Group, a Washington-based research and consulting firm that tracks new construction. Masonry said it closed on 250 homes during the past 12 months at an average price of $214,000.
Hollywood, Fla.-based Technical wants to expand and hopes to purchase other regional builders, said Antonio B. Mon, Technical's chairman and chief executive officer. Last month, publicly traded Technical acquired Jacksonville, Fla.-based D.S. Ware Homes for $35 million.
Technical also has building operations in Northern Virginia, Texas, Arizona, Tennessee and Colorado. It is the nation's 11th-largest builder, according to Washington-based Builder Magazine. It was formed this year by the merger of Engle Homes in Boca Raton, Fla., and Newmark Homes in Houston.
The average home sold by Technical is priced at $165,000, Mon said. The company hopes to move to the $200,000-to- $400,000 range as it expands. Technical closed on more than 5,000 homes during the past year. Its shares rose 25 cents to $14.25 yesterday.
Privately held Masonry joins other regional builders that have been purchased during the past 12 months as the industry continues to consolidate. Harford County-based Barry Andrews Homes and Howard County-based Patriot Homes were bought this year by Lennar Corp., the nation's largest builder. Experts said record home sales in 2000 and 2001 gave major builders more money to go on shopping sprees.
"I just think that the last two to three years has given the large public builders the opportunity to capture larger market shares by the acquisition of solid regional builders," said Peter Bisset, regional sales director with Meyers.
An area building representative said it appears that the consolidation trend is growing.
"It seems to be an increasing phenomenon these days," said John Kortecamp , executive vice president and chief executive officer for the Home Builders Association of Maryland, which has more than 1,200 members in the region. "Longer term, I think we have to bide our time and see what this all means."
Martin K.P. Hill, who founded Masonry in 1971, is to serve as a consultant to Technical. Chief Financial Officer Bob Lacey is president of the new Baltimore subsidiary. Masonry's 60 employees are to remain in their jobs. And the Masonry Homes name is not to change.
"We plan no changes in employment levels," Mon said. "If anything, we want to grow the business, and we probably will be adding to the employment numbers in the future."
The purchase of Masonry gives Technical access to 240 lots in Carroll County and southeastern Pennsylvania. Hill said he will continue to develop lots to provide sewers and other infrastructure for builders such as Technical.
Hill said another company he owns, Woodhaven Building and Development Inc., has access to more than 2,000 lots that homebuilders such as Technical will need, given land-preservation concerns.
"I think the lots are key to the success of any builder," Hill said.