New Business Venture Announced for Johnson Development, Johnson Development Services
February 24, 2012
Houston Business Journal (Week of February 24-March 1,2012)—The Johnson Development Corp., a prolific creator of master-planned communities, has established a new services company to sell development expertise to property ownwers and homebuilders in non-Johnson projects for the first time in the firm's 37-year history.
Johnson Development Services launched at the beginning of the year in partnership with Michael Cox. The operations of Memorial Development Services Inc., a local company formed by Cox in 2001, were folded into the new entity.
Cox and Larry Johnson, CEO of Johnson Devlopment Corp., have ownership stakes in the new company, but the exact structure is not being disclosed. Cox is leading the new business as senior vice president.
Houston-based Johnson Development Corp. started the new business venture as a way to expand and work on smaller residential projects than in the past, said Doug Goff, senior vice president and COO of Johnson Development Corp.
Johnson Development's large communities in the Houston area include the 10,500-acre Sienna Plantation, 3,700-acre Riverstone, 3,000-acre Woodforest and 2,300-acre Fall Creek. The company also develops communities in and around Atlanta.
The expansion plan follows the company's divestiture last year of 320 acres in four local communities to generate cash flow, Goff said. Johnson Development sold acreage in Riverstone, Sienna Plantation and Fall Creek to various homebuilders. Now, theoretically, Johnson Development could win business from those homebuilders by development lots for them.
It has become more difficult for owners of large land tracts to get financing for lot development, Goff said, so the lot supply has been diminishing each year. It sometimes makes more sense for the homebuilder to buy and build the lots, Cox added.
Johnson Development Services will use some employees from Johnson Development Corp. to handle some of the contracts.
"We saw the opportunity to take talent and people around the city and go after additional business," Goff said.
The new operation will be business as usual for Cox, who, over the last 11 years has provided community development on a contract basis and construction services for high-rise resort projects along the Gulf Coast. Some local clients include First Colony, Lost Creek, and Long Meadow Farms.
The first job for Johnson Development Services will be the development of 550 home lots in Willow Creek Farms in Katy. The land is owned by Cox and a small group of investors. Cox initially intended to develop the community with his partner, Jimmy Pappas, who passed away in September.
Construction will begin in the second quarter on the first 100 home lots, which will be delivered to homebuilders by the end of the year. There are commitments from builders, but Cox would not reveal their names yet.
This will be an extension of the original Willow Creek Community, which was started in 2008 by Ryland Homes and Ashton Woods Homes.
A total of 370 home lots controlled by Cox are in the coveted Katy Independent School District. The rest, in the Lamar Consolidated School District, will be held for future home building.
|
