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Home Builders' Partnership May End In Bankruptcy

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By LAURA KINSLER, The Tampa Tribune

Published: November 24, 2007

LIVE OAK PRESERVE - TOUSA's joint venture with Transeastern Homes could pull the multibillion-dollar home builder into bankruptcy.

The company, which operates in 10 states, has lost $818 million this year, including a nearly $620 million loss in the third quarter. TOUSA hired a financial advisory firm in October to assist with a possible restructuring.

A news release said the company "is considering all available in and out of court restructuring and reorganization alternatives, including a possible Chapter 11 filing."

South Florida's Transeastern Homes was the fastest-growing home builder in the United States when it launched New Tampa's Live Oak Preserve in 2003, but the builder failed after partnering with TOUSA in 2005.
TOUSA was forced into a costly buyout of Transeastern and rolled its assets into its Florida subsidiary, Engle Homes. TOUSA's stock price has plunged from nearly $30 a share when the joint venture was formed to 12 cents Nov. 16. On Monday, the New York Stock Exchange halted trading of the stock and delisted it, which could force the company into bankruptcy.
TOUSA has appealed the decision to delist the stock.

The Transeastern deal factored prominently in the company's losses.

On Sept. 30, the company had 452 completed, unsold homes in inventory - a 142 percent increase over the same period in 2006. Nearly half were in former Transeastern communities.
Engle Homes also operates in Pasco County's Tampa Bay Golf & Country Club and The Hammocks, a 500-unit town house project on County Line Road. It controls hundreds of homesites in Live Oak Preserve, which is approved for 1,599 homes.

The company is laying off workers and unloading land at fire sale prices. The earnings release warned that TOUSA could sell off "underperforming assets, communities, divisions and joint venture interests."

Reporter Laura Kinsler can be reached at (813) 865-4844 or lkinsler@tampatrib.com.

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