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Benjamin Obdyke forms Innovation Council

BY HBSDealer Staff

Benjamin Obdyke Incorporated has formed its Innovation Council for 2013. The roof and wall products manufacturer will rely on the varied perspectives of builders, contractors, designers and architects to form conclusions about best practices and innovative solutions in the marketplace.

"As a manufacturer, we recognize that we have limited insight into, and access to, the marketplace," said product development manager George Caruso. "We are constantly looking to interact with leading building professionals on the front lines of the construction industry, and the Innovation Council provides us with insight and ideas that we would likely otherwise miss. In exchange, we expose members to relevant market information related to building construction best practices and current industry trends."

The Council, which is made up of 97 members, plans to conduct in-person focus groups, attend tradeshows and build web resources. (The link to join is here.)

The Council also recently completed the 2013 Product Concept Survey to help determine what motivates construction professionals to choose certain building materials over others. The majority (62%) of the Council worked on the questionnaire.

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Maryland dealers partner with BlueTarp

BY HBSDEALER Staff

BlueTarp Financial announced it has entered into a new partnership with a pair of long-serving lumber companies on Maryland’s Eastern Shore.

Both Rock Hall Lumber Co. and Chestertown Lumber Co. are owned and operated by Ernest “Tot” Strong and his wife Millie, who have guided the companies for nearly 35 years. The companies turned to BlueTarp to manage their in-house trade credit program for their professional customers, including applications, credit extension, service and collections.

“As an independent dealer, making more money in today’s accelerating market certainly requires a watchful eye on many facets of the operation,” said Strong, in a prepared statement. “BlueTarp’s reputation and expertise in credit issues will greatly relax what has become the ‘banking’ aspect of the operation, allowing management to concentrate on selling great products with exceptional customer service. This relationship should greatly relieve credit concerns in any succession plan, which is a major factor in a successful transition.” 

Rock Hall and Chestertown Lumber are expected to benefit from BlueTarp’s guaranteed cash flow by receiving funds on a pre-determined schedule that allows them to plan their investments ahead of time. “Many independent dealers turn to BlueTarp because of our steady cash flow. When we also take away the hidden risks that were there when they managed their in-house program alone and add in flexible terms for customers, it’s a win for everyone,” said Scott Simpson, CEO of BlueTarp Financial.

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Can Minnesota lumberyards sustain the Pulte Homes megadevelopment?

BY Steph Koyfman

There’s an extent to which New Brighton, Minn. represents the national homebuilding industry at large. Under the guise of a statewide housing recovery that’s lurching forward in fits and starts, the community is due for a major expansion that is likely to place demand ahead of supply. The good news, for now at least, seems to be that local lumberyards will have no problem accommodating Pulte Homes’ megasized development project, but the prospect of increased business isn’t drawing a tremendous of enthusiasm.

On June 11, Pulte Homes received approval to build 86 single-family homes and 34 townhomes within 27 acres west of Old Highway 8, the Sun Focus reports. With an average sales price of $385,000 for single-family homes and $170,000 for townhomes, the project (valued at $33.6 million) will put approximately $1.3 million into the city’s hands in exchange for the land, in addition to an annual tax revenue of $336,000.

Daniel Fesler, president of Lampert Yards, said the lumberyard would take the business but would not expect to turn a major profit. 

"We don’t go after production builders in a big way – you can’t make any money on them," he said in an email interview. "They just give you volume and they over-demand. Because track builders work on high volume/low price, you can’t really benefit from their projects."

Overall, this isn’t the biggest development project in Pulte’s arsenal. According to spokeswoman Valerie Dolenga, the homebuilder’s developments range in size from 10-unit neighborhoods to 5,000-unit master-planned communities. Pulte works with both national and local trade partners.

"Quite frankly, our lumber partners can handle the increased request for lumber," said Dolenga in an email.

This runs slightly contrary to a recent report by the National Association of Home Builders, which found that homebuilders and lumber dealers were experiencing significant lumber shortages that falls short of rising demand.

"While a nascent housing recovery is underway, as reflected by the modest increase in sales by dealers, it’s clear that the ongoing material shortages and price increases being reported by dealers continue to be a cause for concern as we move into the latter half of 2013," said Michael O’Brien, National Lumber and Building Materials Dealer Association president and CEO.

According to Fesler, Minnesota was the first to enter the housing downturn in 2005, but the state initiated a steady recovery last year that has been slightly hampered by bad spring weather and recent storm damage.

"The economy in Minnesota is rising; existing house prices are seeing appreciation again," he said. "Days on market for resale is shrinking; good houses are selling quickly, sometimes with multiple offers. [There are] more housing starts last year than the previous two to three years, [and] projects have increased in number and size."

At the very least, the project, which is slated to run from 2014 to 2018, will be a boon to Pulte. Yahoo! Finance reports that PulteGroup, Inc. (PHM) was upgraded to a Zacks Rank #1 (Strong Buy) on Jul. 2 on the heels of a major share price surge. 

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