Landsea Homes Expands Florida Homebuilding Portfolio By Acquiring Hanover Family Builders
NEWPORT BEACH, Calif., Jan. 19, 2022 /PRNewswire/ — Landsea Homes Corporation (Nasdaq: LSEA) (“Landsea Homes” or the “Company”), a publicly traded residential homebuilder, announced today the completion of its acquisition of Hanover Family Builders (HFB), an Orlando-based homebuilder for a purchase price of $179.3 million, subject to certain post-closing adjustments plus the assumption of debt of approximately $69.3 million, which was refinanced with the Company’s unsecured revolving credit facility. In 2021, Hanover closed 632 homes at an average selling price of $328,323 and ended the year with more than 4,100 lots under control, 469 homes in backlog worth more than $200 million and 18 active communities.
“In 2021, Landsea Homes surpassed the milestone of $1.0 billion in revenues and completed our first year as a public company. We believe our acquisition of Hanover Family Builders is another truly transformative event for the Company,” said John Ho, Chief Executive Officer, Landsea Homes. “With the closing of this transaction, we have increased our lots under control to more than 12,800 and further accelerated our asset-light strategy by increasing our controlled lots to approximately 50% of our total lot inventory. We have also grown our active community count by more than 50% from our December 31, 2021 year end. This transaction vaults Landsea Homes into one of the leading positions in the Orlando area, a very attractive homebuilding market, and reaffirms our strategy of quickly becoming one of the top homebuilders in the markets we serve. Additionally, Hanover’s focus on the more affordable segments of the market aligns strongly with our broader product positioning goals.”
Ho continued, “With 469 homes in backlog as of December 31, 2021 at an attractive margin profile, we expect that our acquisition of Hanover Family Builders will have an immediate impact to our earnings and will drive our return on beginning equity to exceed 20% in fiscal year 2022 and beyond. Thanks to the structuring of this deal, and the well capitalized nature of our balance sheet, our leverage ratios remain in good shape following the closing of the transaction, with a pro-forma debt-to-total capital ratio as of December 31, 2021, of approximately 43% and a net-debt-to-total capital ratio below 33%, as calculated by our credit agreement.”