Taylor Woodrow Targets First-Time, Mid-Range Homebuyers
By DANIEL D. WILLIAMS
Upscale homebuilder Taylor Woodrow Homes Inc. hardly is synonymous with the first-time home market in the Inland Empire, but that’s where the company’s Southern California arm is headed under a new management team.
The Irvine-based division of Britain’s Taylor Woodrow PLC,whose latest project is the 15-home Villas at Shady Canyon starting at $1.7 million,hopes to capture a piece of the first-time buyer and move-up markets in Riverside and San Bernardino counties.
As part of the shift, Taylor Woodrow in October hired Michael R. Forsum as its California regional president, replacing Tom Redwitz. Forsum was Northern California division president for Calabasas-based Ryland Group Inc., which targets first-time and move-up buyers.
“We are confident that Mike’s proven leadership abilities and obvious track record will help drive Taylor Woodrow’s growth in these very important markets,” said John R. Peshkin, chief executive of Taylor Woodrow Homes.
Forsum brought at least five people with him from Ryland who form the core of a new management team at Taylor Woodrow.
During Redwitz’ six-year tenure, the local Taylor Woodrow unit produced more than $1 billion in revenue and nearly $200 million in profits with high-end projects such as Castaways, Perazul, Watermark and The Villas at Shady Canyon.
“In the past, Taylor Woodrow has been a medium-volume builder,” Redwitz said. “The emphasis has been on the upper end of the market.”
Barbara Stowers, Taylor Woodrow’s regional vice president of sales and marketing, characterized the shift as a bid to expand the company’s offerings and not as a result of the current economic slump.
But luxury homes have taken the hardest hit during the slowdown. Homes priced $600,000 and up have come down in price in certain OC areas, while homes at $400,000 and below are expected to sell for more during 2002. One estimate has these mid-range homes rising by as much as 7% with luxury home rates stalling or falling.
“The market has been a mixed bag,” said Blaine Carter, an analyst with the Irvine office of The Meyers Group. “In the past five months, we’ve seen prices coming down and sales slowing. In November, some builders had good months, and the market stabilized more than in July, August and September. But there’s not been a lot of investing in the marketplace and builders have been selling off houses.”
In the wake of Sept. 11, Taylor Woodrow’s local sales dipped briefly before regaining strength, according to Stowers.
“Sales have been brisk in November and early December, as buyers who were somewhat skeptical in September and October realize that now is a great time to purchase a new home as interest rates are down, and inventory for new housing is running low in the county,” she said.
For now, Taylor’s Woodrow plans to build out its luxury inventory before bringing its mid-range product online.
The company has sold out the first two phases of homes at Irvine’s Shady Canyon. Taylor Woodrow is in talks with The Irvine Company to buy an extra 20 lots in the masterplanned community, officials said.
Future plans also call for two new Orange County neighborhoods, one in San Clemente and one in Irvine’s Turtle Ridge. Both are in the planning stages and are set to be priced at less than $1 million.
Taylor Woodrow also plans to continue looking for mid-range and high-end housing projects in Los Angeles, Orange and San Diego counties, officials said.
