84 Lumber shifts towards commercial
In a bid to expand its focus beyond residential building, 84 Lumber is bidding on light commercial projects involving steel framing and other types of commercial building products. “We are taking a very definite and purposeful movement into this market,” said Jeff Nobers, vp-communications and marketing for 84 Lumber.
The company’s largest project so far is Grand Palisades at Lake Austin, a resort outside Orlando. 84 Lumber is supplying all the building materials for 890 condo units, including installed metal studs, insulation, exterior sheathing, interior drywall, trim, and metal trusses. The project is being delivered and managed out of the company’s Sanford, Fla., store.
The estimated completion date is February 2010.
84 Lumber worked with the agent of the property, Synergy, on a previous project, according to Nobers. That project, called Mona Lisa, was a 200-unit commercial building. 84 Lumber installed the trim and supplied other building materials.
“These are very different types of projects to manager than home construction,” Nobers observed. As for residential building, “We’re still trying to take market share,” he said.
Hackett’s to open 11th location
Hackett’s, a chain of department stores with full service True Value Hardware departments, has made an agreement to open its 11th location, the Ogdensburg, N.Y.-based company reported.
The new store, which will be located in Lake Placid, N.Y., will occupy a 41,000-square-foot building that was formerly a Tops Market. The company said the store should be open by spring of 2009.
Hackett’s, a subsidiary of Seaway Valley Capital Corporation, opened its 10th location on August 2 in Sackets Harbor, N.Y. The company is one of the nation’s oldest retailers with roots dating back to 1830.
Each of its larger stores contains a True Value hardware department with hardware, tools, plumbing, paint and electrical departments. Other departments in the stores include men’s, women’s and children’s brand name apparel, athletic, casual and work footwear, home dZcor, gifts, seasonal merchandise and sporting goods.
Losses widen at KB Home
CORRECTED – As losses widened at KB Home in the third quarter, the company said that part of its new strategy is to build smaller houses, as demand for less square footage appears to be outpacing demand for the outsized homes that were popular during the housing boom.
Losses in the third quarter were $144.74 million, steeper than the $35.6 million in losses recorded in the comparable period last year. Losses at KB Home totaled $668.8 million for the first three quarters of the year, falling further from losses of $156.8 million in the same nine-month period last year.
Revenues were $681.6 million, down from $1.54 billion in the same period last year, a 55 percent decline. The company also saw an overall 10 percent decline in the average home selling price, to $239,700.
KB Home delivered 2,788 homes, compared with 5,699 homes in the year-ago period. The company’s cancellation rate jumped as well, to 51 percent from 27 percent a year ago.
KB Home CEO Jeffrey Mezger said the cancellation rate reflected “broader dynamics” in the housing market. To respond, the company is trying a variety of tactics, including building smaller homes and cutting the number of developments underway.
In the Inland Empire area of California, he noted, the company is shifting to smaller, less expensive homes, going from an initial size of 3,400 square feet at $450,000, to 2,400 square feet at $300,000 last year. Mezger said that change “worked for a time, but the market continued to move away from us.” In response, the builder has started building three-bedroom, 1,230-square-foot homes selling for $200,000 in the Inland Empire, he said.