Business owner builds local edge

   Ron Covington got into homebuilding 22 years ago in California because his dad worked for one of that state's largest home builders.

   When the industry slowed, he took a teaching job but jumped back into homebuilding after only a semester.

   Now, after spending seven years as Colorado Springsdivision president of California-based John Laing Homes, he started his own company - Ron Covington Homes - late last year. Whether it's designing or building homes, Covington said he's learned that providing a place to live fulfills a fundamental need for most people.

   "The former CEO of Laing used to tell me it's a very noble profession," Covington said. "I've got to agree with him."

   Covington moved to Colorado Springs in 1993, when homebuilding started to gain steam in Colorado. He worked for five years with Classic Cos., the area's largest locally based builder, as a purchasing manager, customer service representative and customer service manager.

   In 1998, he started Estate Homes, which he sold to John Laing three years later. He stayed on to head the company's Springs division.

   Covington has a master's degree in business administration from the University of Colorado at Colorado Springs, and a general education degree from National University in California. He lives in Douglas County with his wife, Grace, and has two children.

   Question: Home construction has slowed significantly in the Pikes Peak region. Why open a homebuilding company now?

   Answer: We think it is a perfect time to start a new homebuilding company. Many of the large national builders are either exiting the market or lowering their production levels. One of the difficulties homebuilders have had is repositioning their communities for a more price-sensitive market.We have the advantage of creating homes that are designed specifically for the buyers' lifestyles, and their financial needs in today's economic environment.

   Q: Ron Covington Homes is working with LandCo Equity Partners, a Springs residential and commercial development firm. What's the relationship between the companies?

   A: LandCo Equity Partners in the parent company of Ron Covington Homes, and I am one of the partners in LandCo.

   Q: What are some differences between local and national builders?

   A: National builders have a great deal of resources and training available to them. Their ability to work with some of the best consultants in the country gives them an edge when it comes to company branding, advertising resources and corporate expertise. However, this is a people business, and great people and great relationships are the most important element to sustained success. I believe the local companies have the advantage in this area. Being a local builder with roots in the national arena gives us the best of both worlds. ... When things get tough, the locals tend to demonstrate a stronger commitment to the marketplace.

   Q: What are some challenges for local builders as they compete against national and regional companies?

   A: National companies have a tremendous amount of resources both financially and professionally. However, with decisionmaking on a local level, the local companies usually have the ability to make quick decisions, and often have a better understanding of the market and their customers' needs. Historically, local companies have actually stood up very well against the larger national companies. ... Knowing that the people who are building your home are a part of your community in good times and difficult times is very reassuring.

   Q: How would you characterize the state of the homebuilding market right now?

   A: The Colorado Springs housing market has found the bottom, and is in the early stages of a recovery. During the past four or five years, the national housing market saw an incredible rise in volume and sales price escalation. Although we benefited from that strong market locally, we were nowhere near the levels of other U.S. housing markets ... Our inventory levels and pricing needed less of a correction. In addition, builders responded quickly to the slowdown, and thus there is not an excess of unsold new homes in Colorado Springs compared to the national housing market.

   Q: What will it take for conditions to improve?

   A: Good businesses are reacting to the market and offering consumers what they are looking for. In 2004 and 2005 it was all about price per square foot. Now homebuyers are looking for homes that fit their lifestyle in great neighborhoods. Many homebuilders are figuring this out ... The lending market has gone through some difficult times recently, which has impacted (buyers') ability to purchase a new home; however, that is beginning to improve and mortgage loans are becoming more readily available.