Deal secures further growth
D.R. Horton has confirmed its acquisition of Gulf Coast-based homebuilder Truland Homes for $100 million.
The nation’s largest residential builder by volume will pay Truland roughly $100 million in cash. Under the deal, D.R. Horton will combine the Truland operations with its current D.R. Horton platforms in Baldwin County, Alabama, and Northwest Florida.
The acquisition will also allow D.R. Horton to increase its homebuilding assets with the addition of Truland’s portfolio of around 263 lots, 155 homes in inventory, and 55 homes in sales order backlog. Additionally, D.R. Horton acquired 156 lots and control of approximately 400 lots through option contracts from Truland affiliates and 201 lots and control of about 260 lots through option contracts from third parties.
Donald R. Horton, chairman of the board, commented: “We are excited for the Truland team to join the D.R. Horton family. Their quality building operations and strong presence across the Gulf Coast make Truland a great addition to D.R. Horton’s already strong local market operations.”
“Leading Truland Homes over the last 13 years has been the most rewarding experience of my professional career,” Truland Homes founder Nathan Cox said in a press release. “The amazing team members that took us from our first home to over a billion dollars in total sales are the ones that deserve all the credit. No matter what, they always came through. In conjunction with growing Truland Homes over the last decade-plus, D.R. Horton has afforded us the honor and privilege of becoming the largest lot supplier within their Gulf Coast region. We look forward to continuing as a key lot development partner for D.R. Horton.”
Read next: US homebuilder sentiment increases to near one-year high
Builder confidence in the market for single-family houses continued to improve as builders boosted production to meet unmet demand, according to the National Association of Home Builders. Mirroring builder sentiment, The Census Bureau reported a 21.7% spike in single-family housing starts, which rose to a seasonally adjusted annual rate of 1.63 million units.
“Builders are feeling cautiously optimistic about market conditions given low levels of existing home inventory and ongoing gradual improvements for supply chains,” said NAHB chairman Alicia Huey. “However, access for builder and developer loans has become more difficult to obtain over the last year, which will ultimately result in lower lot supplies as the industry tries to expand off cycle lows.”
“The Federal Reserve nearing the end of its tightening cycle is also good news for future market conditions in terms of mortgage rates and the cost of financing for builder and developer loans,” added NAHB chief economist Robert Dietz.
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