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Modular success for Excel
By John Hilton, May 22, 2015 at 3:00 AM
Roofers install shingles on a modular unit at Excel Homes in Susquehanna Township, Juniata County. The facility produces five to six residential boxes per day with an average unit size of 2,200 square feet.
Roofers install shingles on a modular unit at Excel Homes in Susquehanna Township, Juniata County. The facility produces five to six residential boxes per day with an average unit size of 2,200 square feet. – (Photo / Amy Spangler)
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The traditional home has long been built from the ground up using hammers, nails and other means to fasten wood, brick, concrete and other materials.
When the company now known as Excel Homes began building homes in 1984, it capitalized on a revolution transforming the modular home industry from a niche business into a mainstream option that today accounts for nearly 10 percent of all new homes. Until then, modular homes were mainly rectangular and suffered the stigma of being associated with the cheap homes that filled a market need in the post-war decades.
That housing need stemmed from the baby boom generation, which fueled strong population growth across the United States.
From a Juniata County manufacturing facility, Excel began making customized modular homes. Advances in Computer-Aided Design programs opened the door for creative modular designs.
Within a few years, Excel was constructing 2,000-square-foot family homes with all the modern amenities — all from the climate-controlled confines of its five factories. Today, the company is under the Innovative Building Systems Inc. umbrella, the result of the 2010 sale of Excel Homes to H.I.G. Capital, a Miami-based private investment firm.
H.I.G named Steven Scheinkman president and CEO and created IBS.
IBS, based in Lower Allen Township, claims to be the leading builder of modular homes in the United States. The original of its five factories is in Susquehanna Township, Juniata County, while others are in Maine, Virginia, Indiana and Iowa.
“The culture that exists at Excel is one of pride and relationships,” said Phil Hickman, president of Excel Homes and All American Homes, another IBS brand. “There are very strong relationships, not only with the employee base … but also the supplier base and the builder base. We treat our janitor the same as we treat our CEO.”
Tough times
After more than 25 years of mostly strong growth, Excel Homes went through a tumultuous period in 2010. The down period coincided with the poor economy, which caused home sales to plummet.
President and CEO Steve Scharnhorst resigned in April, and the company was acquired a month later by H.I.G. Capital.
Anthony Zarilli, president of Zarrilli Homes Inc. in Brick, N.J., had several homes on order at the time for various customers. He recalled meeting Scheinkman, who personally visited Zarilli to smooth relations.
“It wasn’t the easiest process for about six months, but they 100 percent came through,” Zarilli said. “So that kind of solidified the relationship for me.”
Zarilli is one of Excel’s biggest customers, ordering 30 to 40 homes annually for the Jersey Shore. The majority of IBS homes are sold along the East Coast; overall they are sold in more than 30 states.
“I’ve tried a couple other companies over the years and nobody has been able to beat Excel on the quality,” said Terrance Hegel, owner and president of Atlantic Modular Builders in Manasquan, N.J. “When I talk about Excel as a manufacturer to my customers, I say they’re the Toyota of the modular home world.”
In 2014, Scheinkman and partner Jeffrey Samson bought a bigger stake in IBS from H.I.G., and became majority shareholders. The five years under Scheinkman have seen strong growth, with IBS acquiring All American Homes, Modukraf Homes, Keiser Homes, and, most recently, Future Home Technology Inc. and HandCrafted Homes.
The latter two deals were completed in December. Jolene Myers, president and chief financial officer of IBS, said it is looking for more acquisitions. The company continues to rebound from the economic downturn, she added. IBS built 1,000 homes in 2014, with revenue of about $100 million.
While the 2014 production represented a 30 percent increase over 2013, the numbers are about a third of what Excel produced in 2004 and 2005, Myers said. Excel produced about 3,000 homes annually during that 2004-05 period.
The company owns seven factories total, two of which remain shuttered.
Public acceptance
According to U.S. Census data, manufactured homes accounted for about 9 percent of the 678,000 new homes built in 2013, the most recent year data is available. But builders say acceptance is growing due to the options available.
Virtually anything short of an elevator can be added in an IBS factory, Hickman said. Builders can handle requests for everything from security systems to the latest ceramic tile, he added.
“If you think about the stick-built and the construction on site, the materials are outside,” Hickman said. “In a plant, everything is stored in a controlled environment. Construction methods, because we’re in a controlled environment, are much tighter.”
Customers can order a million-dollar home built in a factory that is as good, or better, than one built on-site, Zarilli said. And the Excel/IBS personnel work with builders to solve issues.
For example, New Jersey builders had concerns this year about ground-floor pipes freezing, Zarilli said. After consulting with Excel, an alteration was implemented to move pipes between the first and second floors. Moving the pipes between the first and second floors eliminated exposure to ground temperatures. Pipes are now located between flooring and insulation, which helps prevent freezing.
“That’s going to eliminate the freezing problem,” Zarilli said. “We just have that kind of relationship. You run into problems, but we always just get on the phone and work it out. They have high integrity and they stand behind their product.”
Timeline of Excel Homes
1984: The company now known as Excel Homes begins manufacturing homes at its Susquehanna Township, Juniata County facility.
1997: Partners Ed Langley and Perry Bolton purchase the Susquehanna Township facility and create Excel Homes Inc.
2004: Huron Capital Partners buys a stake in Excel Homes with a major investment.
2007: Steve Scharnhorst is named president and CEO of Excel Homes, subsequently leading the company through the economic downturn, which hit housing especially hard.
2010: H.I.G. Capital, a Miami-based private investment firm, purchases Excel Homes and creates a new company, Innovative Building Systems, which becomes the corporate parent of Excel. Steve Scheinkman is named president and CEO.
2014: Scheinkman and Jeffrey Samson buy a majority stake from H.I.G., becoming majority shareholders in IBS. H.I.G. becomes a minority shareholder.
December 2014: IBS completes purchases of HandCrafted Homes and Future Home Technology Inc., adding to its roster of brands, which includes All American Homes, Modukraf and Keiser Homes, all purchased since 2010.
Source: Innovative Building Systems
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Modular success for Excel
By John Hilton, May 22, 2015 at 3:00 AM
Roofers install shingles on a modular unit at Excel Homes in Susquehanna Township, Juniata County. The facility produces five to six residential boxes per day with an average unit size of 2,200 square feet.
Roofers install shingles on a modular unit at Excel Homes in Susquehanna Township, Juniata County. The facility produces five to six residential boxes per day with an average unit size of 2,200 square feet. – (Photo / Amy Spangler)
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The traditional home has long been built from the ground up using hammers, nails and other means to fasten wood, brick, concrete and other materials.
When the company now known as Excel Homes began building homes in 1984, it capitalized on a revolution transforming the modular home industry from a niche business into a mainstream option that today accounts for nearly 10 percent of all new homes. Until then, modular homes were mainly rectangular and suffered the stigma of being associated with the cheap homes that filled a market need in the post-war decades.
That housing need stemmed from the baby boom generation, which fueled strong population growth across the United States.
From a Juniata County manufacturing facility, Excel began making customized modular homes. Advances in Computer-Aided Design programs opened the door for creative modular designs.
Within a few years, Excel was constructing 2,000-square-foot family homes with all the modern amenities — all from the climate-controlled confines of its five factories. Today, the company is under the Innovative Building Systems Inc. umbrella, the result of the 2010 sale of Excel Homes to H.I.G. Capital, a Miami-based private investment firm.
H.I.G named Steven Scheinkman president and CEO and created IBS.
IBS, based in Lower Allen Township, claims to be the leading builder of modular homes in the United States. The original of its five factories is in Susquehanna Township, Juniata County, while others are in Maine, Virginia, Indiana and Iowa.
“The culture that exists at Excel is one of pride and relationships,” said Phil Hickman, president of Excel Homes and All American Homes, another IBS brand. “There are very strong relationships, not only with the employee base … but also the supplier base and the builder base. We treat our janitor the same as we treat our CEO.”
Tough times
After more than 25 years of mostly strong growth, Excel Homes went through a tumultuous period in 2010. The down period coincided with the poor economy, which caused home sales to plummet.
President and CEO Steve Scharnhorst resigned in April, and the company was acquired a month later by H.I.G. Capital.
Anthony Zarilli, president of Zarrilli Homes Inc. in Brick, N.J., had several homes on order at the time for various customers. He recalled meeting Scheinkman, who personally visited Zarilli to smooth relations.
“It wasn’t the easiest process for about six months, but they 100 percent came through,” Zarilli said. “So that kind of solidified the relationship for me.”
Zarilli is one of Excel’s biggest customers, ordering 30 to 40 homes annually for the Jersey Shore. The majority of IBS homes are sold along the East Coast; overall they are sold in more than 30 states.
“I’ve tried a couple other companies over the years and nobody has been able to beat Excel on the quality,” said Terrance Hegel, owner and president of Atlantic Modular Builders in Manasquan, N.J. “When I talk about Excel as a manufacturer to my customers, I say they’re the Toyota of the modular home world.”
In 2014, Scheinkman and partner Jeffrey Samson bought a bigger stake in IBS from H.I.G., and became majority shareholders. The five years under Scheinkman have seen strong growth, with IBS acquiring All American Homes, Modukraf Homes, Keiser Homes, and, most recently, Future Home Technology Inc. and HandCrafted Homes.
The latter two deals were completed in December. Jolene Myers, president and chief financial officer of IBS, said it is looking for more acquisitions. The company continues to rebound from the economic downturn, she added. IBS built 1,000 homes in 2014, with revenue of about $100 million.
While the 2014 production represented a 30 percent increase over 2013, the numbers are about a third of what Excel produced in 2004 and 2005, Myers said. Excel produced about 3,000 homes annually during that 2004-05 period.
The company owns seven factories total, two of which remain shuttered.
Public acceptance
According to U.S. Census data, manufactured homes accounted for about 9 percent of the 678,000 new homes built in 2013, the most recent year data is available. But builders say acceptance is growing due to the options available.
Virtually anything short of an elevator can be added in an IBS factory, Hickman said. Builders can handle requests for everything from security systems to the latest ceramic tile, he added.
“If you think about the stick-built and the construction on site, the materials are outside,” Hickman said. “In a plant, everything is stored in a controlled environment. Construction methods, because we’re in a controlled environment, are much tighter.”
Customers can order a million-dollar home built in a factory that is as good, or better, than one built on-site, Zarilli said. And the Excel/IBS personnel work with builders to solve issues.
For example, New Jersey builders had concerns this year about ground-floor pipes freezing, Zarilli said. After consulting with Excel, an alteration was implemented to move pipes between the first and second floors. Moving the pipes between the first and second floors eliminated exposure to ground temperatures. Pipes are now located between flooring and insulation, which helps prevent freezing.
“That’s going to eliminate the freezing problem,” Zarilli said. “We just have that kind of relationship. You run into problems, but we always just get on the phone and work it out. They have high integrity and they stand behind their product.”
Timeline of Excel Homes
1984: The company now known as Excel Homes begins manufacturing homes at its Susquehanna Township, Juniata County facility.
1997: Partners Ed Langley and Perry Bolton purchase the Susquehanna Township facility and create Excel Homes Inc.
2004: Huron Capital Partners buys a stake in Excel Homes with a major investment.
2007: Steve Scharnhorst is named president and CEO of Excel Homes, subsequently leading the company through the economic downturn, which hit housing especially hard.
2010: H.I.G. Capital, a Miami-based private investment firm, purchases Excel Homes and creates a new company, Innovative Building Systems, which becomes the corporate parent of Excel. Steve Scheinkman is named president and CEO.
2014: Scheinkman and Jeffrey Samson buy a majority stake from H.I.G., becoming majority shareholders in IBS. H.I.G. becomes a minority shareholder.
December 2014: IBS completes purchases of HandCrafted Homes and Future Home Technology Inc., adding to its roster of brands, which includes All American Homes, Modukraf and Keiser Homes, all purchased since 2010.
Source: Innovative Building Systems