United Homes Group (UHG), No. 48 on the 2023 BUILDER 100 list, continues its expansion in the Southeast with the acquisition of Rosewood Communities in South Carolina.
“We liked their product set, we liked the demand that their product set created, we liked their community locations, we liked their forward lot locations. We really see [the acquisition] as a diversification strategy from a product standpoint,” Jack Micenko, president of UHG, told BUILDER. “Our [average sales price] is in the $325,000 to $335,00 range. Theirs is probably close to double that.”
The acquired company builds primarily in the Greenville and Clemson markets. Micenko told BUILDER that in-migration growth in the upstate South Carolina market is strong and makes the area a high-growth potential market.
“Acquiring Rosewood Communities is a great opportunity to expand our existing footprint in the upstate area,” UHG CEO Michael Nieri said in a news release announcing the deal.
“With a world-class university in Clemson and a booming industrial base in Greenville with employers like BMW, upstate South Carolina is a fast-growing, attractive new-home market. Rosewood’s innovative home designs will also allow us to diversify our product offering in the upstate, and we plan on using their designs in our other markets.”
UHG said Mark Nyblom, the former owner of Rosewood Communities, will stay on as division manager–Rosewood.
“I am very pleased to become a part of the UHG team,” Nyblom said. “The UHG story is inspiring, and I believe that Rosewood Communities will bring a lot to the table as a member of the family. The combination of the UHG land-light business model and focus on the Southeast is very promising, and my team and I are excited about the future.”
Nyblom formed Rosewood Communities in 1998; for the first 10 years in business the company primarily operated as a developer before initiating its concept of low-maintenance cottage-style communities in 2008. The acquisition adds a second move-up and empty nest move-down product type to the UHG portfolio, which has primarily been catered toward first-time buyers and first move-up buyers, Micenko said.
“We became public to support growth both organically and through M&A. Part of that is really product diversification and creating a broader product portfolio that allows us to bring that product into our markets,” Micenko said. “More product diversification will allow us to take on bigger land positions because we can diversify the offering, which will allow us to grow where we already have high market share in places like the Midlands of South Carolina without cannibalizing our current offering.”
Micenko said the acquisition is consistent with the company’s strategic vision announced when UHG went public earlier this year.
“We plan to continue deploying capital into thoughtfully chosen acquisitions of private builders,” Micenko said. “The Rosewood transaction follows our entrance into the Raleigh, North Carolina, market in August of this year. We will continue to focus on growth via both entry into new markets and adding builders that allow us to offer a more diversified product set.”
Micenko said UHG will continue to look at private builders, either within its existing markets or in contiguous markets, to grow in the near term.
“We have a fairly defined market footprint. We’re trying to be intelligent, we’re trying to be measured and grow in a deliberate, conscious manner,” Micenko told BUILDER.
Inclusive of the Rosewood communities, UHG will operate 19 communities in the upstate South Carolina market, with plans for future expansion. Columbia, South Carolina-based UHG operates and builds new-home communities in South Carolina, North Carolina, and Georgia.
