Make us your home page
Instagram

Pulte Homes' merger with Centex Corp. will cost Florida jobs

Two giant home builders with a Tampa Bay area presence dating back to the 1980s are joining forces in a $1.3 billion merger.

The union of Pulte Homes and Centex Corp. combines Pulte's strength in retirement housing with Centex's might with first-time home buyers.

Pulte plans to save $350 million by absorbing Centex. The new company will adopt the Pulte name. The efficiency comes at a price: Integrating the two companies will cost the area jobs.

Pulte employs about 150 in its Central Florida division, which includes Tampa. Close to 70 people work for Centex in west Florida. Overlap is inevitable.

"Neither Centex nor Pulte people have enough to do. So they can trim their overhead, especially staff, and manage the same amount of construction," Tampa Bay area housing analyst Marvin Rose said.

In terms of sales, both companies sit comfortably in the top 10 of builders in the Tampa Bay area. They've also won plaudits for quality, ranking near the top of the J.D. Power and Associates Tampa area customer satisfaction survey.

Tampa hasn't seen such a large merger of home builders since Lennar Homes doubled its size by buying U.S. Home in 2000. Pulte will now be the country's biggest home builder with combined sales of $11.6 billion. The No. 2 builder, D.R. Horton, took in $5.82 billion last year.

"It's a blockbuster," Rose said. "Everybody predicted consolidation of some of the major players in this housing downturn."

But the merger comes with risks. It's happening as home sales stake out their lowest point in decades. Construction has dropped about 75 percent since the peak in 2005-06.

Pulte lost almost $3.73 billion over the past two years, wiping out profits for the previous three boom years. Centex lost $2.66 billion last year, erasing four years worth of earnings.

Florida has been shedding construction workers for nearly three years. In the past year alone, the building industry dropped 115,000 jobs, shrinking by 21 percent.

Pulte took a big hit in 2007 when it bailed from the 14,000-home Wiregrass Ranch project in Wesley Chapel, on the edge of New Tampa. The company plunked down tens of millions in deposits to buy the ranch, but lost that money when it canceled the deal.

Pulte entered the Tampa Bay area 27 years ago by buying Robert Sierra's Criterion Corp., builder of Northdale and Bloomingdale in Hillsborough County. Centex followed Pulte into the local market about the same time, absorbing Karpay Homes in the early 1980s.

By a series of smaller mergers, the companies have broadened their brands. Pulte also runs retirement home builder Del Webb and luxury builder DiVosta. Centex controls the Fox & Jacobs trademark.

The merger raised expectations among investors about other builder takeovers. Beazer Homes, for example, is trading for about a dollar. Its shares, combined with those of Lennar and Hovnanian, all jumped Wednesday.

Times wires contributed to this story.

Pulte Homes' merger with Centex Corp. will cost Florida jobs 04/08/09 [Last modified: Wednesday, April 8, 2009 8:35pm]
Photo reprints | Article reprints

Copyright: For copyright information, please check with the distributor of this item, Times Staff Writer.
    

Join the discussion: Click to view comments, add yours

Loading...
  1. Daniel Lipton resigns as artistic director of Opera Tampa

    Stage

    TAMPA — Daniel Lipton has resigned as artistic director of Opera Tampa, the David A. Straz Jr. Center for the Performing Arts announced.

    Daniel Lipton became the artistic director and conductor of Opera Tampa in 2012. Lipton replaced the opera's only previous director, Anton Coppola, who retired. [Times file (2012)]
  2. Throwback Tampa Bay station 102.9 goes from R&B jams to WFLA-AM's conservative talk

    Blogs

    Talk radio station WFLA-AM (970) began simulcasting on 102.9 in the Tampa area this morning. 

    Tampa's 102.9 is going from Throwback Tampa Bay to WFLA-AM's news radio.
  3. Bank of Tampa expanding into Sarasota

    Banking

    TAMPA — The Bank of Tampa is expanding to Sarasota County. It opened a loan office this month in downtown Sarasota at 1858 Ringling Blvd., which will be converted to a full-service branch within the year, the company said in a release Monday.

    The Bank of Tampa is expanding to Sarasota. Charles Murphy, pictured, will lead the Sarasota branch. | [Courtesy of The Bank of Tampa]
  4. Tampa Bay home prices still climbing, though more slowly

    Real Estate

    Tampa Bay home prices rose again in June, although the once-torrid pace of increases shows signs of slowing.

    This three story home in Port Richey's gated Harborpointe sold for $1.15 million in June, making it the top sale in Pasco County for the month.
[Penny Perry]
  5. Pinellas licensing board asks Sen. Jack Latvala for $500,000 loan

    Local Government

    The troubled Pinellas County agency that regulates contractors wants Sen. Jack Latvala to help it get a $500,000 lifeline from the state to stay afloat.

    State Sen . Jack Latvala, R- Clearwater, is being asked to help the Pinellas County Construction Licensing Board get $500,000 from the state so it can stay open beyond February.  [SCOTT KEELER   |   Times]