Eastex Advocate - News
Jim Walter Homes shutting its doors
By ALEX WUKMAN
After 62 years Tampa, Fla.-based home builder Jim Walter Homes will be closing up shop. Walter Industries, Inc. announced January 6 that it would be shutting its “legacy” home construction business in order to shift focus to the more lucrative Pure Play Natural Resources and Energy industry.
The announcement of the closure came on the ninth anniversary of the death of company founder Jim Walter. Walter founded the company in November of 1946 when he took $395 of the money he made while serving in the Navy during WWII and bought an unfinished home, which he later sold for close to $700.
Since its inception, Jim Walter Homes had built 350,000 homes; in 2002 the company opened two subdivisions — Woodbridge Glen in Brookwood, Alabama and Patriot Point in Houma, La. Despite diversification, the home construction division had not been profitable for several years.
“The story of Jim Walter Homes began as World War II ended and soldiers came home to pursue the American Dream. Regrettably, it ends at a time when the fundamentals of the homebuilding industry have deteriorated in ways never seen before,” said Walter Industries Chairman Michael T. Tokarz.
According to a report from PRNewswire, Jim Walter Homes is expecting to record an $8-10 million pre-tax charge, which is a fee that has to be spent before taxes are paid. The charge is related to the closure of the business.
The shuttering of the home construction division comes after a major restructuring last year that saw the closure of almost half of the Jim Walter Homes sales centers. However, even that did not help the troubled company.
“Efforts to sell the business were unsuccessful in the face of the unprecedented conditions in the housing industry and tightness in the credit markets,” reads a company issued statement. The closure will affect approximately 230 employees nationwide, including those in the Cleveland office.
The company stated to PRNewswire that even though sales efforts have ceased they will continue to meet obligations to customers with homes under construction. As of December 31, Jim Walter Homes had 150 homes under construction nationwide, including two in the Beaumont area.
However, the Jim Walter Homes website stated that the company is “still selling and building in our Patriot Point community in Houma, La.” and encouraged interested parties to contact the Patriot Point sales office in Houma.
The closure comes after what some have called one of the darkest periods for the company. For the last several years, Jim Walter Homes has been plagued with customer complaints.
The seriousness and amount of complaints forced the West Florida Better Business Bureau to revoke Jim Walter Homes’ membership in December of 2006.
However, the BBB later changed the classification and stated that Jim Walter Homes had “an unsatisfactory record.” Currently Jim Walter Homes has a BBB rating of F and is considered a non-accredited business.
Complaints about the company using defective materials, hiring substandard subcontractors and then refusing to pay them, as well as building homes on the wrong property and then foreclosing on the homeowner litter websites like ripoffreport.com and myjimwalterhome.com.
Many of the problems seem to have started after company founder Jim Walter died in 2000. Before his death, Walter had been recognized at home and abroad as a dynamic leader of industry.
The company that bore his name had built 320,000 homes in 24 states. The active mortgage portfolio on those homes had grown to be worth over $4 billion.
Because of a combination of factors, some beyond the control of Jim Walter Homes’ executives, the first business Walter created will be shutting its doors for good nine years after his death. Customers of Jim Walter Homes who have questions or concerns about a home under construction should call 1-800-925-8374, ext. 4444.
The announcement of the closure came on the ninth anniversary of the death of company founder Jim Walter. Walter founded the company in November of 1946 when he took $395 of the money he made while serving in the Navy during WWII and bought an unfinished home, which he later sold for close to $700.
Since its inception, Jim Walter Homes had built 350,000 homes; in 2002 the company opened two subdivisions — Woodbridge Glen in Brookwood, Alabama and Patriot Point in Houma, La. Despite diversification, the home construction division had not been profitable for several years.
“The story of Jim Walter Homes began as World War II ended and soldiers came home to pursue the American Dream. Regrettably, it ends at a time when the fundamentals of the homebuilding industry have deteriorated in ways never seen before,” said Walter Industries Chairman Michael T. Tokarz.
According to a report from PRNewswire, Jim Walter Homes is expecting to record an $8-10 million pre-tax charge, which is a fee that has to be spent before taxes are paid. The charge is related to the closure of the business.
The shuttering of the home construction division comes after a major restructuring last year that saw the closure of almost half of the Jim Walter Homes sales centers. However, even that did not help the troubled company.
“Efforts to sell the business were unsuccessful in the face of the unprecedented conditions in the housing industry and tightness in the credit markets,” reads a company issued statement. The closure will affect approximately 230 employees nationwide, including those in the Cleveland office.
The company stated to PRNewswire that even though sales efforts have ceased they will continue to meet obligations to customers with homes under construction. As of December 31, Jim Walter Homes had 150 homes under construction nationwide, including two in the Beaumont area.
However, the Jim Walter Homes website stated that the company is “still selling and building in our Patriot Point community in Houma, La.” and encouraged interested parties to contact the Patriot Point sales office in Houma.
The closure comes after what some have called one of the darkest periods for the company. For the last several years, Jim Walter Homes has been plagued with customer complaints.
The seriousness and amount of complaints forced the West Florida Better Business Bureau to revoke Jim Walter Homes’ membership in December of 2006.
However, the BBB later changed the classification and stated that Jim Walter Homes had “an unsatisfactory record.” Currently Jim Walter Homes has a BBB rating of F and is considered a non-accredited business.
Complaints about the company using defective materials, hiring substandard subcontractors and then refusing to pay them, as well as building homes on the wrong property and then foreclosing on the homeowner litter websites like ripoffreport.com and myjimwalterhome.com.
Many of the problems seem to have started after company founder Jim Walter died in 2000. Before his death, Walter had been recognized at home and abroad as a dynamic leader of industry.
The company that bore his name had built 320,000 homes in 24 states. The active mortgage portfolio on those homes had grown to be worth over $4 billion.
Because of a combination of factors, some beyond the control of Jim Walter Homes’ executives, the first business Walter created will be shutting its doors for good nine years after his death. Customers of Jim Walter Homes who have questions or concerns about a home under construction should call 1-800-925-8374, ext. 4444.
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