Housing starts for June show improvement
Monthly housing starts for June rose above the 600,000 mark for the first time since January, according to data released today by the Commerce Department.
Housing starts increased to a seasonally adjusted annual rate of 629,000 in June, up 14.6% from the revised May estimate of 549,000. Single-family starts also showed a big improvement — up 9.4% to a rate of 453,000.
The 629,000 annual rate came in much higher than anticipated by most forecasts, which had called for a rate of about 570,000.
The June figures were heading in the right direction on a year-over-year basis, also. Total housing starts were up 16.7% over June 2010, and single-family starts were up a slight 0.4% compared with a year ago.
Looking at the four regions of the country, single-family construction showed the biggest growth in the Midwest, where starts increased more than 20% compared with last year and last month. The Northeast in June posted a 35.1% increase in total housing starts, compared with May.
Building permits in June were at a seasonally adjusted annual rate of 624,000, up 2.5% from May, and up 6.7% compared with June 2010.
Former ProBuild execs form investment group, acquire steel company
An investment group led by Paul Hylbert, former CEO of ProBuild Holdings, and Boreas Advisors have announced the acquisition and recapitalization of Barton Supply, a Colorado fabricator and distributor of structural and reinforcing steel products and accessories.
Hylbert’s new investment group, as yet unnamed, partnered with Boreas Advisors in 2011 to look for opportunities in the housing and building products industry. It wasn’t difficult for Hylbert and Boreas to find each other after Hylbert left ProBuild three months ago: Boreas consists of former ProBuild executives.
Steve Swinney, former VP finance, planning and analysis at ProBuild, is managing partner of Boreas Advisors. The Denver-based firm’s principals, Kyle Barker, Bryan Cleveringa and Eric Miller, all worked in finance at ProBuild.
Swinney will serve as CEO of the new acquisition, while Cleveringa will serve as CFO. The former owners of Barton Supply, Don and Scott Barton, will stay on as part of the management team, as well as investors.
With locations in Aurora, Colorado Springs and Fort Collins, Barton Supply serves general contractors, foundation and framing subcontractors, and home builders. Over the past five decades, Barton Supply has grown to three locations and added bending, cutting and welding capability to fabricate reinforcing steel products, as well as structural steel beams, posts and columns.
In an interview with Home Channel News, Hylbert talked about the 18-acre facility and rail siding at Barton’s main facility, and the similarities between the distribution of any building materials, be it lumber or steel. Although Hylbert still has three months left on his non-compete contract with ProBuild, “We’re in the rebar fabrication game,” he explained. “These are products that lumberyards don’t sell [so] it’s not really competitive with ProBuild.”
Temple-Inland board urges shareholders to reject IP offer
The takeover battle for Temple-Inland continues to escalate as the Austin, Texas, wood products supplier issued a statement today urging its stockholders to reject an unsolicited offer from International Paper (IP). Temple-Inland’s board of directors voted unanimously to reject the $30.60-per-share offer because it undervalues the company. The timing of the offer is also “extremely opportunistic,” the company said in its official recommendation.
“Housing markets are at historically low levels, temporarily depressing the value of our building products operations,” the board wrote. “IP is attempting to take advantage of our stockholders by moving to grab Temple-Inland at a bargain price at a time when there is little or no market value being ascribed to building products.”
International Paper will finance the $3.7 billion deal with $1.5 billion cash and the rest in borrowings. The company is interested in Temple-Inland’s corrugated packaging operations, which consist of seven mills and 58 converting facilities. Temple-Inland also makes a wide range of wood-based building materials.