Big Buyers: D.R. Horton, Arlington, Texas
D.R. Horton is one of the most acquisitive builders in the industry, picking up 17 companies since 1994 from Hawaii to Florida. But three deals stand out in CEO Donald Tomnitz’s mind: Continental Homes in 1998, Cambridge Properties in 1999, and Schuler Homes in 2001.
Merging with Continental “put us in the big leagues purchasing-wise,” Tomnitz says, pushing Horton’s volume to 14,000 closings in 1998. “That’s when we had the volume for national purchasing to realize efficiencies.” Cambridge represents a “sentimental” favorite for the CEO: Horton’s share price fell during the acquisition process, but the sellers agreed to postpone the stock-based deal until Horton values rose, rather than selling to another builder. As for Schuler, “that put us over the top,” Tomnitz says, as the combined company delivered 31,584 homes last year, making it the largest home builder in the country, based on U.S. closings.
Revenue has climbed as well. In 2002, Horton generated $7.3 billion, resulting in a three-year compound annual growth rate of 40.1 percent. But the company’s penchant for acquisitions has gotten Horton in trouble with stock analysts, who’d prefer to see more internal growth at the Arlington, Texas-based builder. “I’m really indifferent about whether we do it internally or externally,” says Tomnitz, who says that since 1994, the company’s growth has come half from operations and half from acquisitions. Still, the company nodded to the organic growth pressure, promising to provide 20 percent earnings-per-share growth in 2003 without acquisitions.
Horton’s internal growth strategy: market domination. The company is already among the top five builders in 70 percent of its markets, but division presidents receive bonuses if they land in a market’s top five builders, occupy the No. 1 spot, or capture double-digit market share. “We don’t want them resting on their laurels,” says Tomnitz.
While the home building industry remains fragmented, Tomnitz says that the rise of the mega-builders has changed some of the attitudes about growth and the potential size of a home building company. “I think most people thought a home builder doing 20,000 units a year would implode. I don’t think they thought there was a corporate structure to support it,” he says. “Now they’re talking about a 50,000-unit builder or a 100,000-unit builder.”
| Rank | Company/Address | % Gross Revenue Change 2000-2002* | 2002 Gross Revenue** | % Closing Growth From 2000-2002 | 2002 Closings (What They Build) | Year Founded | No. of Employees |
| Key: EL = Entry-level, MU = Move-up, LUX = Luxury/Custom, AA = Active adult, SEC = Second home | |||||||
| *Revenue change = the compounded annual growth rate over three years. **In millions | |||||||
| 1 | Anderson Homes 335 Water St. | 900% | $50 | 17,100% | 172 EL, MU | 2000 | 65 |
| 2 | Kara Homes 197 Rt. 18 | 258.8% | $103 | 1,600% | 289 EL, MU, LUX, AA, SEC | 1999 | 155 |
| 3 | Shamrock Construction 2160 E. Lemon Creek Rd. | 139.4% | $2 | -20% | 14 EL, MU | 1993 | 3 |
| 4 | Dana Dugas Affordable Homes P.O. Box 11310 | 133.4% | $2 | 267% | 22 EL, MU, SEC | 2000 | 3 |
| 5 | Town & Country Home Builders 201 S.W. Port St. Lucie Blvd. | 107% | $3 | 250% | 21 MU, LUX, SEC | 1998 | 10 |
| 6 | Pageantry Cos. 1333 N. Buffalo Dr. | 94.9% | $76 | 287% | 410 EL | 1994 | 95 |
| 7 | Homes By Kennedy 600 W. Hillsboro Blvd. | 89.2% | $68 | 245% | 441 EL, MU, AA, SEC | 1997 | 53 |
| 8 | Lowell Homes 80 S.W. 8th St. | 81.5% | $56 | 85% | 222 EL, MU, LUX | 1987 | 35 |
| 9 | Transeastern Properties 3300 N. University Dr. | 73.5% | $295 | 103% | 1140 EL, MU, AA | 1986 | 210 |
| 10 | Dunmore Homes 2150 Professional Dr. | 72.1% | $160 | 100% | 577 EL, MU | 1953 | 135 |
| 11 | Keystone Homes 924 Stevens Creek Rd. | 67.3% | $28 | 172% | 215 EL, MU | 1995 | 23 |
| 12 | Vantage-Raylee Homes 4131 Barbara Loop | 65.3% | $41 | 225% | 273 EL, MU, LUX | 1976 | 40 |
| 13 | Syncon Homes 2221 Meridian Blvd. | 60% | $87 | 106% | 303 EL, MU, LUX | 1995 | 55 |
| 14 | Joseph Douglas Homes 19435 W. Capitol Dr. | 54.9% | $12 | 76% | 37 MU, SEC | 1999 | 9 |
| 15 | Ole South Properties 275 Robert Rose Dr. | 53.8% | $71 | 131% | 627 EL | 1987 | 34 |
| 16 | World Development 44600 Village Ct. | 53.5% | $33 | 49% | 58 EL, MU | 1997 | 45 |
| 17 | Hovnanian Enterprises 10 Hwy. 35, | 49.7% | $2551 | 118% | 9514 EL, MU, LUX, AA | 1967 | 500 |
| 18 | Ginsburg Development Corp. 245 Saw Mill River Rd. | 49.5% | $114 | 131% | 268 MU, LUX | 1964 | 164 |
| 19 | Meritage Corp. 8501 E. Princess Dr. | 46.7% | $1120 | 105% | 4574 EL, MU, LUX, AA | 1985 | 870 |
| 20 | Lee Wetherington Homes 6009 Business Blvd. | 44.6% | $69 | 90% | 190 MU, LUX, AA, SEC | 1981 | 70 |
| 21 | M.B.K. Homes 175 Technology Dr. | 44.5% | $117 | 55% | 310 EL, MU | 1991 | 71 |
| 22 | Centerline Homes 12534 Wiles Rd. | 44.2% | $104 | 39% | 418 EL, MU, LUX, AA | 1994 | 87 |
| 23 | Century Homebuilders 7270 N.W. 12th St. | 44% | $141 | 80% | 855 EL, MU, SEC | 1999 | 110 |
| 24 | Legend Home Corp. 10410 Windermere Lakes Blvd. | 42.2% | $93 | 85% | 587 EL, MU | 1991 | 85 |
| 25 | Orleans Homebuilders One Greenwood Sq. | 42% | $361 | 67% | 1282 EL, MU, LUX, AA | 1920 | 367 |
| 26 | Keystone Homes 3611 W. Swann Ave. | 41.4% | $12 | 163% | 42 EL, MU, LUX, SEC | 1984 | 16 |
| 26 | Main Street Homes 717 N. Courthouse Rd. | 41.4% | $22 | 52% | 93 MU, AA | 1996 | 26 |
| 26 | Patrick Malloy Communities 851 Cedar St. | 41.4% | $32 | 78% | 158 EL, MU | 1997 | 35 |
| 26 | SeaGate Homes 185 Cypress Point Pkwy. | 41.4% | $30 | 83% | 262 EL, MU | 1994 | 43 |
| 30 | Elliott Homes 80 Iron Point Cir. | 41.3% | $479 | 21% | 1394 EL, MU, LUX | 1955 | 176 |
| 31 | Gehan Homes 1101 N. Union Bower Rd. | 40.2% | $173 | 79% | 1090 EL, MU | 1991 | 160 |
| 32 | D.R. Horton 1901 Ascension Blvd. | 40.1% | $7324 | 67% | 31584 EL, MU, LUX, AA, SEC | 1978 | 5000 |
| 33 | Matthews Brothers Homebuilders 8134 Country Village Dr. | 39.5% | $37 | 77% | 253 EL, MU, AA | 1997 | 27 |
| 34 | Town & Country Homes 1806 S. Highland Ave. | 39% | $290 | 80% | 1350 EL, MU | 1958 | 318 |
| 35 | Mercedes Homes 6767 N. Wickham | 37.8% | $575 | 59% | 3066 EL, MU, SEC | 1985 | 1086 |
| 36 | Essex Homes Southeast 4458 Augusta Rd. | 37.4% | $17 | 74% | 80 EL, MU | 1993 | 17 |
| 37 | Holiday Builders 2293 W. Eau Gallie Blvd. | 35.5% | $235 | 61% | 2114 EL, MU, AA | 1983 | 250 |
| 38 | Brownstone Homes 12670 S.W. 68th Ave. | 35.4% | $22 | 46% | 120 EL, AA | 1987 | 12 |
| 39 | Southern Homes of the Upstate 108 Ole Towne Sq. | 35% | $31 | 89% | 268 EL, MU, LUX, SEC | 1989 | 50 |
| 40 | Woodside Group 3855 S. Jones Blvd. | 34.9% | $641 | 39% | 2491 EL, MU, LUX | 1977 | 388 |
| 41 | Kalian Corp. 225 Hwy. 35 | 34.3% | $119 | 107% | 749 EL, MU, AA, SEC | 1986 | 46 |
| 42 | Beazer Homes USA 5775 Peachtree Dunwoody Rd. | 34.2% | $2852 | 82% | 14720 EL, MU, LUX, AA, SEC | 1985 | 2905 |
| 43 | Bowen Family Homes 4460 Commerce Dr. | 33.5% | $173 | 63% | 951 EL, MU, AA | 1993 | 100 |
| 43 | Realen Homes 1040 Stony Hill Rd. | 18000% | $0.45 | 54700% | 1968 | 120 | EL, MU, LUX, AA |
| 45 | Century Vintage Homes 1535 S. D St. | 33% | $168 | 45% | 655 EL, MU, LUX, SEC | 1962 | 118 |
| 46 | Gateway Homes 10255 Richmond Ave. | 32.6% | $58 | 57% | 407 EL, MU | 1990 | 55 |
| 47 | Sotherby Homes 4975 Preston Park Blvd. | 32.3% | $56 | 71% | 188 MU | 1995 | 50 |
| 48 | Amber Homes 14901 E. Hamden Ave. | 31.7% | $26 | 51% | 157 EL, AA | 1998 | 38 |
| 49 | Parkside Homes 1600 Specht Point Dr. | 31.2% | $31 | 42% | 185 EL, MU | 1996 | 18 |
| 50 | Highland Holdings 4110 S. Florida Ave. | 30.4% | $51 | 27% | 372 EL, MU, AA | 1996 | 35 |
| 50 | McDaniels Homes 9470 Annapolis Rd. | 30.4% | $17 | 46% | 60 EL, MU, LUX | 1995 | 13 |
| 52 | Bosgraaf Homes 301 Douglas Ave. | 29.9% | $27 | 49% | 121 MU | 1985 | 30 |
| 52 | Essex Homes of Western New York 8940 Main St. | 29.9% | $27 | 51% | 77 EL, MU, LUX | 1992 | 25 |
| 54 | Southern Engineering Corp. 7501 Wisconsin Ave. | 29.1% | $10 | 67% | 25 MU | 1951 | 10 |
| 55 | Renaissance Custom Homes 1672 S.W. Williamette Falls Dr. | 28.7% | $48 | 43% | 136 MU, LUX, AA | 1984 | 40 |
| 56 | Carefree Homes 1560 Goodyear St. | 28.1% | $41 | 46% | 356 EL, MU | 1990 | 16 |
| 57 | ICI Homes 2359 Beville Rd. | 27.1% | $218 | 19% | 767 MU, LUX, AA, SEC | 1980 | 158 |
| 58 | Pasquinelli Construction Co. 6880 N. Frontage Rd. | 26% | $381 | 39% | 2004 EL, MU, LUX, AA | 1956 | 341 |
| 59 | McBride & Son Enterprises 1 McBride Center Dr. | 25.6% | $292 | 73% | 1098 EL, MU, LUX | 1946 | 940 |
| 60 | Pinnacle Homes 5768-B Miller Ct. | 25.4% | $11 | 31% | 81 EL, MU | 1997 | 11 |
| 61 | Astoria Homes 9555 Del Webb Blvd. | 25.1% | $122 | 38% | 568 EL, MU | 1995 | 115 |
| 62 | Park Square Homes 5200 Vineland Rd. | 24.3% | $122 | 37% | 546 MU, LUX, SEC | 1984 | 110 |
| 63 | Ball Homes 3399 Tates Creek Rd. | 24.2% | $148 | 38% | 949 EL, MU | 1958 | 140 |
| 64 | Dominion Homes 5501 Frantz Rd. | 22.8% | $492 | 44% | 2591 EL, MU | 1946 | 562 |
| 65 | Bryant Building Co. P.O. Box 876 | 22.5% | $3 | 88% | 15 MU | 1987 | 2 |
| 65 | Stillbrooke Homes 8901 Adams N.E. | 22.5% | $33 | 38% | 148 EL, MU, LUX, SEC | 1997 | 28 |
| 65 | Whitestone Custom Homes 1017 N. Central Pkwy. | 22.5% | $12 | 27% | 42 MU, LUX | 1998 | 12 |
| 65 | Woodland Homes of Huntsville 7545-A Hwy. 72 W. | 22.5% | $18 | 26% | 68 MU, LUX | 1995 | 23 |
| 69 | The Drees Co. 211 Grandview Dr. | 21.7% | $838 | 31% | 2746 EL, MU, LUX | 1928 | 930 |
| 70 | Michael Crews Development P.O. Box 300429 | 21.5% | $31 | 25% | 65 MU | 1979 | 82 |
| 70 | Neumann Homes 4355 Weaver Pkwy. | 21.5% | $248 | 21% | 1156 EL, MU | 1992 | 280 |
| 72 | Royce Homes 7850 N. Sam Houston Pkwy. W. | 21% | $347 | 23% | 1604 EL, MU, LUX | 1984 | 320 |
| 73 | Southern Homes of Polk County 2000 E. Edgewood Dr. | 20.9% | $19 | 59% | 165 EL, SEC | 1991 | 21 |
| 74 | Tadian Homes 2038 W. Big Beaver | 20.6% | $40 | 104% | 161 EL, MU | 1985 | 80 |
| 75 | Fieldstone Communities 14 Corporate Plaza | 20.4% | $293 | 20% | 800 EL, MU | 1986 | 165 |
| 76 | TK Constructors 5141 W. Hessler Rd. | 20.3% | $55 | 33% | 513 EL, MU | 1990 | 132 |
| 77 | Belgravia Group 833 N. Orleans | 20.2% | $39 | 12% | 91 EL, MU, LUX | 1989 | 12 |
| 77 | GHO Homes 5670 Corporate Way | 20.2% | $13 | 40% | 81 MU, AA, SEC | 1983 | 27 |
| 77 | Standard Pacific Corp. 15326 Alton Pkwy. | 20.2% | $2050 | 62% | 6265 MU, LUX, AA | 1961 | 1359 |
| 80 | Grand Homes 8350 N. Central Expwy. | 19.8% | $191 | 23% | 670 EL, MU, SEC | 1986 | 241 |
| 81 | Thompson Homes 981 S. Bolmar St. | 19.5% | $30 | 93% | 56 LUX, SEC | 1975 | 20 |
| 82 | G.L. Homes of Florida 1401 University Dr. | 19.3% | $434 | 23% | 1355 EL, MU, LUX, AA | 1976 | 300 |
| 83 | Forrest Homes 4040 Nine McFarland Dr. | 18% | $32 | 43% | 251 EL, MU | 1998 | 39 |
| 84 | The Hamlet Cos. 308 E. 4500 S. | 17.8% | $43 | 28% | 287 EL, MU | 1994 | 61 |
| 85 | The Villages of Lake-Sumter 1100 Main St. | 17.6% | $463 | 27% | 2260 AA | 1959 | 2220 |
| 86 | WCI Communities 24301 Walden Center Dr. | 17.5% | $1218 | -7% | 1699 MU, LUX, AA, SEC | 1946 | 3000 |
| 87 | NVR 7601 Lewinsville Rd. | 16.3% | $3136 | 13% | 11368 EL, MU, LUX | 1987 | 3334 |
| 88 | Hometowne Building Co. 37000 W. 12 Mile Rd. | 16.1% | $58 | 37% | 163 EL, MU | 1995 | 58 |
| 89 | Lakewood Homes 2500 W. Higgins Rd. | 15.9% | $258 | 22% | 1250 EL, MU, LUX, AA | 1990 | 134 |
| 90 | Choice Homes 1600 E. Lamar Blvd. | 15.5% | $467 | 23% | 3879 EL, MU | 1987 | 375 |
| 90 | Cullum Homes 8408 E. Shea Blvd. | 15.5% | $12 | -38% | 5 LUX | 1985 | 36 |
| 92 | Lennar Corp. 700 N.W. 107th Ave. | 15% | $7320 | 21% | 27393 EL, MU, LUX, AA | 1954 | 7700 |
| 92 | M.D.C. Holdings 3600 S. Yosemite St. | 15% | $2319 | 19% | 8900 EL, MU, LUX | 1972 | 2250 |
| 94 | Venture Homes 1580 Terrell Mill Rd. | 14.6% | $63 | 9% | 302 EL, MU | 1984 | 90 |
| 95 | MHI 7676 Woodway | 14% | $520 | 23% | 2715 EL, MU | 1989 | 400 |
| 96 | Morrison Homes 3700 Mansell Rd. | 13.5% | $806 | 19% | 3197 EL, MU, AA | 1978 | 675 |
| 97 | Toll Brothers 3103 Philmont Ave. | 13.3% | $2329 | 12% | 4430 MU, LUX, AA, SEC | 1967 | 2960 |
| 98 | Great Western Homes 3850 E. Baseline Rd. | 13.2% | $100 | 53% | 742 EL, MU, AA | 1995 | 75 |
| 98 | Iverness Group 11305 Reed Hartman Hwy. | 13.2% | $50 | 32% | 282 EL, MU, AA | 1994 | 55 |
| 100 | Hallmark Communities 10675 Sorrento Valley Rd. | 11.8% | $20 | 4% | 56 EL, MU, LUX | 1984 | 38 |
| 100 | Woodstock Building Associates 78 Prospect St. | 11.8% | $5 | 50% | 12 MU | 1978 | 26 |
Learn more about markets featured in this article: Houston, TX, Dallas, TX, Los Angeles, CA, Atlanta, GA.
