National homebuilder and developer Taylor Morrison announced it has finalized its acquisition of AV Homes.
The deal, valued at close to $1 billion, marks a new phase in Taylor Morrison's growth strategy.
Taylor Morrison explained that this acquisition expands its scale in five overlapping markets, including Orlando, Phoenix, Charlotte, Raleigh and Dallas-Ft. Worth, and adds Jacksonville to the company’s portfolio.
Taylor Morrison said it is expecting to now generate $5 billion in revenue in 2018, with 54,000 owned and controlled lots spread out over 19 markets. Last year, Taylor Morrison and AV Homes closed 8,032 homes and 2,491 homes, respectively.
"When we set our sights on growing our business, we were looking for a builder whose footprint overlaid neatly with ours and could take us deeper into the top housing markets we operate in today," said Sheryl Palmer, Taylor Morrison chair and CEO.
"This deal represents a leap forward at a time when macro fundamentals favor housing and support Taylor Morrison's smart-growth roadmap. The combined business broadens our target market with more options for first-time and 55-plus buyers, two consumer groups AV Homes served well,” she added.
The acquisition increases Taylor Morrison's workforce by 20%, according to the company, which also said it has created an integration plan to provide a “seamless” employee onboarding experience.
"We are thrilled to welcome AV Homes team members to the Taylor Morrison family, and are excited to work together to make the transition into our culture, technology environment and operations as seamless and productive as possible," said Palmer.
The deal is just another in a phase of consolidation in the homebuilding industry. Last year, Lennar acquired WCI Communities, a luxury homebuilder headquartered in Florida, for $963 million, and later, Lennar purchased CalAtlantic Group in a $9.3 billion deal that created the nation’s largest homebuilder.