Sales plunged at DSLD Homes with the start of coronavirus pandemic; now the area homebuilder is setting records.
DSLD is projecting to build about 150 to 250 more homes this year than it forecast six months ago.
“For four weeks, our sales fell in half,” said Jeff Purpera Jr., DSLD’s chief financial officer. “Then sales picked back up and we’ve been setting records since May for new contracts and closings. To say it has been surprisingly good would be to put it mildly.”
DSLD now expects to build 3,550 homes companywide, after Purpera pegged sales projections in March at 3,300. Within its core south Louisiana market alone, DSLD expects to do about the same, going from 2,050 to about 2,200.
Purpera credits low interest rates and millennials wanting to get out of rental properties and into their own homes as driving much of the sales activity.
“It’s the first-time homebuyers that are really driving it,” he said.
First-time buyers are a crucial part of DSLD’s business. The company, which posted $659 million in revenue in 2018, sells just under 60% of its homes to first-time buyers.
“We sell to a lot of teachers, firemen, police officers, people who work in the plants,” Purpera said. “A lot of two-income families with a child or two.”
DSLD’s homes start in the $170,000 range and go up to about $350,000. The average sale price is about $215,000.
“Lot prices are our single biggest cost component,” Purpera said. “We reverse engineer to be at a certain price point.”
The key for DSLD is to find affordable land in areas near good schools. "Location is going to be the key," he said.
DSLD has about 400 employees, a little more than 300 who work in Louisiana, supervising construction and handling the sales and marketing of homes.
In order to keep track of all the houses under various stages of construction, the company has a team of inspectors going out to check how a house is coming together. The sheer repetition of contractors and subcontractors building roughly the same type of home helps too, Purpera said. It’s one thing to build a home; it’s another thing to build that same home for the 50th or 100th time.
Purpera and the other principals of DSLD, Saun Sullivan, the chief executive officer, and Lee Foster, the manager of construction and building, got their start working with longtime Denham Springs builder Allen Thomason. Thomason built hundreds of homes in Livingston Parish over the years.
“When we started, we were just in Denham Springs, Ascension and a little bit of Tangipahoa,” Purpera said. “Then Katrina hit.”
Thomason sold all of his lots to national builder D.R. Horton in 2006. His building and title company remained, but he had to give up the name. As a placeholder, Thomason’s attorney gave his first business the name DSLA, which stood for “Denham Springs, Louisiana”. Other entities were dubbed, DSLB, DSLC, and so on.
When Thomason got back into real estate a few years later, the entity that had his insurance and contractors license was known as DSLD — so that’s how the company got its name.
“We never bothered to change the name,” Purpera said. “We typically tell people it stands for Denham Springs Land Development, but it doesn’t really mean anything.”
When DSLD started in 2010, the company was concentrated in the old Thomason footprint. It quickly got to the point where it had reached market saturation and sales were happening at the extent of other DSLD communities. In order to expand, the business moved into Lafayette in 2012. Houma-Thibodaux followed in 2013, then Lake Charles and Shreveport.READ MORE