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Letter to the editor

Crisis clobbers another builder

Tousa, a builder with Tampa area ties, files for bankruptcy but vows to keep operating.

By JAMES THORNER, Times Staff Writer
Published January 30, 2008

Florida-based Tousa Inc., which thrived in the housing boom off such best-selling neighborhoods as New Tampa's Live Oak Preserve, has filed for bankruptcy.

Tousa, based in Hollywood, became the second builder active in the Tampa area to seek bankruptcy protection in the midst of a sharp housing downturn. The first was Levitt & Sons, active in Hernando County.

But unlike Levitt, which ceased construction as bankruptcy loomed last fall, Tousa vowed Tuesday to continue business as usual. Its subsidiary, Engle Homes, will maintain operations in neighborhoods such as Live Oak, the Hammocks in New Tampa and Pasco County's Tampa Bay Golf & Country Club.

Tousa blamed the credit crisis, falling home prices, low consumer confidence and high inventory for its troubles.

Like many builders, Tousa sold a large percentage of homes to investors in places like Live Oak. While such sales initially buoyed the company, the investors ended up competing for the same buyers with Tousa.

"This action is necessary to reflect the realities of today's home building market. Our core operations are solid, and our market position suggests a strong future," company president Antonio Mon said.

Tousa entered the Tampa market in August 2005 by buying Transeastern Homes for $857-million.

Transeastern had already built much of Live Oak and other Florida neighborhoods. Last year, Tousa folded Transeastern into Engle Homes.

The Transeastern purchase coincided with the first signs of a housing slowdown. Tousa's financial struggles made it ripe for bankruptcy rumors for much of last year.

In announcing the filing, Tousa said it will placate creditors by handing over "substantially all of the common stock of the reorganized company."

To keep up construction and payroll, Tousa plans to borrow an additional $150-million from Citigroup Global Markets Inc. Tousa's bankruptcy petition listed total assets of $2.28-billion and debts of $1.77-billion.

Times staff writer Bill Coats contributed to this report. James Thorner can be reached at thorner@sptimes.com or (813) 226-3313.

[Last modified January 29, 2008, 22:42:17]