Housing Giants - October 10, 2008 - (Page 20)

FOr NeArly 30 yeArS, housing industry icon Art Rutenberg, now 81, pioneered his unique franchising concept exclusively in Florida, with only a few small steps into contiguous home building markets in bordering states Alabama and Georgia. But now, Art has kicked himself upstairs and turned over day-to-day leadership of his company, Clearwater, Fla.-based franchise network Arthur Rutenberg Homes, to David Hanrahan, 40, and Alan Weiner, 48, who have ambitious plans to sign up builder franchisees in Atlanta, Charlotte, and the coastal resort markets of the Carolinas. Certainly, the condition of Florida’s housing markets had to influence this decision, and the new CEOs have a mandate to grow Rutenberg’s franchise network to justify their positions. The firm’s housing revenues dropped to $385.6 million in 2007, from a peak of $492 million the previous year, even though the average sale price escalated from $677,685 in 2006 to $864,600 in 2007. (It now stands at just under $1 million in 2008.) Still, homes closed dropped precipitously from 726 in 2006 to 446 last year. Even so, Rutenberg is climbing Professional Builder’s Giant 400 rankings — from No. 78 in 2006 to No. 63 this year. But the decision to grow the company actually pre-dates the Florida housing slump. “In October of 2005, just coincidentally the month the market crashed, Art promoted us to co-CEOs and declared that he’s now the nonexecutive chairman of the company,” Hanrahan recalls. “But he told us he retains ‘unlimited meddling rights,’ and he’s keeping his word.” Art Rutenberg has not taken any sixweek vacations, says Alan Weiner. “He does travel a lot,” Weiner laughs, “but it’s mostly road trips to visit the franchises, to see how they’re using the services we provide. His most important role right now is quality control. He delves into different areas of our operations and looks at every aspect of that department’s operations. In a down market, he wants to use the opportunity we have to get better at everything we do. His knows this company inside out. He wants us to come out of this downturn a better company.” And a bigger one. Art Rutenberg’s theory has always been an appealing one, a housing equivalent of McDonald’s Corp.: Let the franchisees carry the debt and assume most of the risk. Grow the 20 HOUSING GIANTS.10.10.08 www.HOUSINGGIANTS.cOm http://www.arthurrutenberghomes.com http://www.housingzone.com/probuilder/index.asp?layout=giants http://www.housingzone.com/probuilder/index.asp?layout=giants http://www.housinggiants.com

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