Homebuilder Leaves California for Texas as ‘Blue’ State Business Exodus Continues
A U.S. homebuilding company has Announcement plans to move its headquarters out of California, in another blow to the state.
Landsea Homes, a Newport Beach, California, construction firm, which designs and builds master-planned communities and houses across the country, announced Mar. 8 that it would move its corporate headquarters to Dallas, Texas.
The company has built homes and communities throughout Massachusetts, New York, New Jersey and Arizona.
“As a national publicly traded homebuilder with communities from California to Florida, this is a strategic move in the best interests of our shareholders,” John Ho, Landsea Homes’ director and CEO, stated this in a press release.
“In addition to our overall coast-to-coast growth strategy, we are very focused on growing our homebuilding footprint in Texas, and this move demonstrates our strong commitment to the state.”
Landsea’s new headquarters in Dallas will be on the 10th Floor at 1717 E. McKinney Street. It will cover 7,716 square footage.
‘Blue’ States Lose Out to ‘Red’ State in Business Exodus
The home-development firm was one of the many firms that fled. “blue” Texas to a better business environment, including Exxon Mobil, AT&T and Hewlett Packard.
Previously, Tesla and other companies such as Chevron, Hewlett Packards, NortonLifeLock, Kaiser Aluminum, and Chevron were headquartered in California. But, these businesses have moved to the Democrat-run state.
Tesla, which moved to Texas from the Bay Area in 2021, saved its CEO Elon Musk $2.5 billion in capital gains taxes.
Ho called Landsea’s decision to leave the state a positive move for the company in many other ways.
“We are relocating our corporate headquarters to Dallas, Texas, from Southern California, a move that should provide cost savings over time,” Ho told investors on a call on Mar. 7.
Texas only made up just 3 percent of Landsea’s revenue in 2022, but the company wants to build up its presence in the booming Lone Star State—but that will take time, he said.
The company currently has 1,087 lots that it owns or controls, primarily in San Antonio and Austin housing markets.
“Texas will come on toward the end of the year, but generally it will be around the same split [at year-end],” Ho explained.
California was responsible for 35 percent, Florida 33 percent, and Arizona 22 percent of the company’s homebuilding revenues in 2022.
Landsea Homes generated a total of $1.4 billion in revenue and pretax income of $11 million in 2022. The CEO reported that earnings were at $1.70 per share.
Despite closing 2,370 homes last year (a 45 percent increase in 2021), major challenges were faced in 2022’s second half due to a decline of the buyers sector.
“While 2022 was a record year in terms of profitability, it was also a year in which the demand environment became more challenging due to a rapid rise in mortgage rates and a subsequent decline in homebuyer confidence,” Ho said.
“This change in market dynamics caused buyers who were in the market for a new home to become more cautious and prompted buyers in our backlog to cancel their purchase contracts. As a result, our net new order activity in the third and fourth quarters dropped off significantly as compared to the prior year.”
Progressive Policies Fail Taxpayers
California lost a seat in Congress because of progressive policies. This is the first time that this has happened in American history.
Millions of Californians in the middle class and their companies complained about high taxes, draconian mandates, public corruption and rising crime. They also felt that there was little return on taxpayers’ money.
So-called ‘woke’ policies, the high cost of living, and political pressure from the left have not made things better in California, even for those who are not conservative.
Pandemics and other factors have led to the demise of once fashionable areas, and business districts have been decimated over the last three years.
The state government reported that it had accumulated a surplus of $75 Billion in 2022. However, it was short $25 Billion by the end.
Florida and Texas have seen the greatest outward surge in residents and congressional seats. “blue” State such as New York, Illinois and California.
U-Haul annual Report 2022 saw a massive influx of people from California and Illinois to the Lone Star State of Sunshine State. This has been increasing since the pandemic.
The report showed that New York City, Massachusetts, Michigan and Illinois were among the worst performing states in terms of growth last year.
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