The Palm Beach Post from West Palm Beach, Florida on March 29, 1998 · Page 90
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The Palm Beach Post from West Palm Beach, Florida · Page 90

West Palm Beach, Florida
Issue Date:
Sunday, March 29, 1998
Page 90
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Page 90 article text (OCR)

THE PALM BEACH POST SUNDAY, MARCH 29, 1998 Lennar a 'production' builder I 30 YEAR FIXED age, said Cannon of AREEA. 15YEAR FIXED 6.375 7& NO INCOME, NO ASSET C LOWEST RATES AVAILABLE Se ASK 3 Down Payment ABOUT No Closing Cost First OO HOT BUY ANOTHER CD, ANNUITY or VIATICAL PROGRAM until You call Our Toll Free 1-888-262-7804 24 HOURS FOR A FREE REPORT Southern MORTGAGE CORP. I OUR: No Point DIRECT LENDERS 'Licensed Mortgage Bankers f S Banking Department ' Rales subiect to chai API without notice Mortgages with I s and Monthly payments These 5.49 The OLDE Premium Plus Money Market Series won the Lipper Analytical Services and IBC Financial Data 1997 awards. These awards were given for the number one total return performance for the 1 2 months ending December 31, 1997, out of 210 and 299 general purpose retail funds respectively. The fund was also ranked 1 by both services for the five-year period through December 31, 1997 out of 173 and 181 funds respectively. Past performance is no guarantee of future results. In addition to its top ranking, this money market fund offers: A highly competitive yield Daily access to your cash Free checks and checkwriting 5.64 3fliD required. 833-2900 Jupiter 561 747-4500 351 South U.S. Highway 1 A minimum initial investment of $25,000 is West Palm Beach 561 302 Datura Street Ranked 3 out of 232 General Purpose money market Data, Inc. OLDE has and continues to absorb a portion and effective yields would have been 5.43 and 5.58 For more complete information on the OLDE Premium Plus Coconut Creek 954 968-6900 3840 Coconut Creek Parkway OLDE America's Full Service Discount Broker1 funds for the 7-day period ending 031798. Source: IBC's of the expenses of the fund until January A 1999. Had the respectively. Money Market Series, including management fees, charges and an OLDE office. Read it carefully before you invest or send money. An investment in this fund is neither insured nor guaranteed by the U.S. government, and there can be no assurance tlmt the fund will be able to maintain a stable net asset value of $1.00 per share. Past performance is no guarantee of future results. Yields fluctuate. 398 OLDE Discount Corporation Member NYSE & SIPC "They got out of it and they resolved it," he said of the Hurri cane Andrew damage. They came to the piper with their insur ance and their own resources. Since the 1992 hurricane, Len nar's stock has climbed steadily year after year, trading an average of 6.40 m 1992 to an average $10.32 in 1997. With the compa ny s recent spin off of its commercial and financial services division, and its buyout of California-based Pacific Greystone, stock prices are shooting up. In the past nine months the stock has tripled its value, setting a new company high last week of $33.38 after first-quarter numbers were released. Jess Santamaria, who has been building homes in the western communities for 25 years, sees a different worry with Lennar. "Over the years we have had a multitude of builders, big and small. It's been very competitive, and that's the reason prices are so good," said Santamaria, principal of Royal Professional Builders. "What I'm seeing now are a few large national builders like Lennar that are gobbling up all the remaining vacant land. They're public companies. They have zillions of dollars and they can buy thousands of acres. There will be a complete shrinking of competition, and prices are going to go up." Indeed, Lennar does plan to stay out west as long as there's potential development, said Mike Smolak, head of the company's Palm Beach County division. There's going to be a lot of growth in the area," he said, "and we plan on being part of that." The 1 r If Rotes Rise, So Can 6.625 7& I ll-WH 11 1 I UJ-IUE. lAva.laDI. Habla Espartol North Palm Beach 561-688-0844 Boca Raton 561-361-8200 Broward 954-527-5800 financing in excess ot 60 available with slightly higher rales apply to new applicants only Current Yield Effective Yield Money Fund Report a service of IBC Financial expenses not been absorbed, the fund's current expenses, obtain a prospectus by calling or visiting T$ AJ" if $10 .(. arcnunu he mff Uw ri wnttJnmJ. Nation!Wia Carp bought in western Palm Beach County, it already had operations in Arizona and Texas and would enter California at the same time. "Historically, they tend not to land-bank, but they do all sorts of buying when there are opportunities around," said company analyst Sheldon Grodsky of Orange, NJ.-based Grodsky Associates Inc. They expanded into Texas and California mostly when the market was weak." But there's more to why Lennar is the western communities' biggest landholder today, analysts said. "They did a coup during the RTC bank failure days," said Michael Cannon, president of Appraisal and Real Estate Economic Associates Inc. of Miami. "They went to Wall Street and saw an opportunity in aligning themselves with Morgan Stanley Real Estate Fund to bid on portfolios of mortgages. "They actually bought, for cents on the dollar, huge portfolios, then sold off the pieces they couldn't use for themselves. They didn't use their capital. It was Wall Street money." Lennar was the first home builder to own a significant part of Wellington. The community's original developer and those who followed were all land sellers, not home builders, said Joe Piconcelli, who worked with all three of Wellington's master developers. The original developer, Breakwater Housing, sold individual lots to prospective settlers who toured a "model's row" where many small builders vied for their business. Under Wellington's original architectural guidelines, Lennar would not have been able to build "A builder could put two of the same houses on a block, but they had to change the front elevation And the colors had to be different,' said Darryl Bowen, a Realtor who sat on the original architectural review board. By the mid 1980s, there were about 100 small builders con structing homes in Wellington, said Piconcelli, who opened his own construction company, Flori da East Coast Developers, in 1988. Many did not survive the early 1990s downturn. And those re maining can't compete against the giant Lennar. "Lennar gives an awful lot of square footage for the dollar, said Piconcelli. "When I looked at it and saw thein coming, I did a turn in my business and got out of the market Lennar was in and went more to the custom building." Problems crop up Lennar entered the western communities still stinging from damage done to its homes from Hurricane Andrew that devastated Miami in 1992. Lennar was accused of having built shoddy homes that were destroyed in the storm. Lennar settled many claims. A few still linger, according to the company's 1997 annual report issued this month. And the company has had other problems as well. Lennar settled last year with homeowners in the Miramar Hampshire Homes development when a sinkhole opened up to reveal Lennar had built on a trash dump. And late last year, some home owners from a Boca Raton devel ODtnent where Lennar had sold "Homes of the Future," filed class-action suit alleging the sys tems don t work. "Those homeowners who hav 'Homes of the Future' are part of this," said Jeffrey Sonn, who rep resents the plaintiffs. Vere in discovery rigl t now." The judge has not detemiined yet whether there is a class, he said. The suits have not tarnished the home builder's long-term im- southern plan projects said 37 percent of homeowners in the southern U.S. region are taking on home projects this year, budgeting $2,939 a 36 percent increase over last year's $2,150 estimate. (Retailers take note.) While home offices are high on the upper end, most homeowners (27 percent) are putting more focus on the bedroom beating out the living room (17 percent), which was last year's top room. And just where does the money come from? Despite the frequent notices that homeowners "qualify" for a second mortgage, 70 percent say they will dip into their savings, with 57 percent of those supplementing their budgets with windfalls such as income tax fund or company bonus. Only 9 percent also rely on a home improvement loan and 5 percent through refinancing a mortgage. Yoi! tan reach Am Van de Water &204722 or fax her at 8204445. 'LENNAR I From IF m ; Jj "I had a client I took into Bink's p Forest," said real estate broker Jj Wanda Smith. "And he said, This j is just $250,000 tract homes." ; Lennar is building homes in 1 prices stretching from $112,000 ?i for a patio home at Grand Isle through $160,000 for 2,500 square 2 feetin Saddle Brook to $184,000 on j the golf course in Lakefield. Len nar houses sold for more than 4 $200,000 in The Preserve at Bink's .1 Forest S i But it still carries an imace of a Moderate home builder for nodest-income families. Even Ci with four to six models per com-(J munity, Lennar's style is more the repetitive cookie-cutter home than .tjhe majority of the developments si-in the western communities. There was always that poten-'tial that they would produce the vjower-end cheaper tract house," Z said Mark Miles, who owns Wellington Remodeling and Miles Construction. "It's kind of a nasty S term to call it a tract home because J they're building some nice homes, J but heaven help you if you want to move a wall." ' Lennar admits they don't cus- tomize homes. ' "We are a production home ' builder, meaning we build homes jj that are value-oriented, and we ' build groups of them so we can pass on the efficiencies to the : buyer." 3 Realtor Four out of 5 sales : Across the nation, 6,702 buy- ers chose Lennar during the com-',, pany's last budget year, and 3,367 ! of those were in Florida. Smith, a $ Realtor for 18 years, said last year ; was her best, and four of every five j .houses she sold were new homes. i The company's venture to ! Palm Beach County's western-; most suburbs began in 1992 when ; it paid $2.75 million for nearly 600 ; acres on Okeechobee Boulevard ; that had once belonged to Palm ' Beach millionaire Henry Rolfs. ! Rolfs had lost the land through ! foreclosure to First Union National I Bank. 1 - In 1994, Lennar and First Union did business again. A Len-nar subsidiary bought all the re-; maining Wellington property that ; the community's last developer, ' Corepoint Corp., had lost through i foreclosure. The acquisition in-' eluded 500 lots, mostly in the Aero ; Club, Lakefield and Meadow I Wood, a small commercial section ! on Pierson Road, and the commu- nity's two country clubs. . Then, Lennar bought the 541 ' lots surrounding Bink's Forest I Golf and Country Club for $7.8 ! million from the Resolution Trust I Corp. There, Lennar premiered its ! "Home of the Future" in western I Palm Beach County. The homes j were equipped with electronic : systems that allowed a homeown-i er to operate functions by voice ' command or through their televi-; sions or telephones. A year later, Lennar bought and foreclosed on the mortgages of the huge Orange Point tract, 1,700 acres of orange groves on which Palm Beach County had approved the construction of 1,500 homes. "We thought early on that that part of the county was a desirable . place to live. We had the financial I resources to take advantage," said I Mark Shevory, Lennar's South ' Florida regional president. Florida's largest builder : Lennar, created in 1954 when Leonard Miller invested in Miami-based F&R Builders, was known for buying moderately priced land and building inexpensive homes. It became Florida's largest home builder when it bought rival Hollywood-based Development Corp. of America in 1987. By the time the company I One-third of homeowners SOURCE From IF And on the northern tip of Hy-poluxo Island (Point Manalapan is the southern portion of the island), an 8,000-square-foot house is going up on a lot that sold for $785,000. A few doors away is a huge house owned by Binns, who Said he just got a contract on it for more than his asking price of $1.65 million. There were three people chasing it" he said. j Did you know . . . One in four (26 percent) Americans earning ' $40,000 or more annually plan to ! add or refurnish a home office this J year. And, on average, they expwt J to spend $1,459 on equipment, in- eluding desk chair, computer, fax machine, work station, file storage ! nd accessories. The index, which monitors consumers' retail spending trends. re at Your Interest In This CD. 16 - Month CD. Sure Step There 's no place to go but up with the Sure Step CD from NationsBank and Barnett. Because no matter what happens to interest rates, you'll come out ahead. If rates rise, you can step up to a higher rate after only six months, locking in that higher rate for an additional 16 months, or longer. If rates go down, you're already locked in for 16 months at your original rate. We also offer an IRA which works the same way. So stop by your nearest NationsBank or Barnett banking center to open your Sure Step CD. Barnett. E3(SGfrjiisS(SiuiI A Mercer Of Ideas. A New Level Of Financial Opportunity... 'Annual pe-n-entaa wHs (ATTI effective a of VUrr". !- The rrurumuir. halame to .-n at .nt ! '' TV rrunimurr- hatanr to earn a S jh balance under SlO.OiiM mil tarn APV tH !! m.wth Suit nt ft Rat arc ut o(unc "ith'iit mine A jwnaJt t NationsBank Corporation suhii.iiari haMs are MnJm FHC Barwrt N A a iTi suhi.1iar of NatKOivRank rpnratkt C:

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