$564M homebuilder sets its sights on new counties, multifamily market

On a recent tour of the Homes By Westbay showroom in Riverview, Willy Nunn, president and CEO of the $564 million homebuilder, pointed with pride to a narrow and shiny kitchen table. 

Nunn wasn’t about to break bread with the visitor. Instead, he mentioned that in a design session he had with his team, he pushed them to add the smaller table next to the more standard six-by-nine foot kitchen island. The design team demurred, saying it threw off the look and open concept. Nunn pushed forward. Now it’s one of the most popular kitchen additions for homebuyers. 

“There’s nothing better than being told something can’t work,” says Nunn, winking and smiling, “and then it does.” 

That mindset, combined with several other internal and external factors, has driven Homes by Westbay to the top of the Tampa Bay area homebuilding market. Now, with several transformative moves afoot — geographical expansion into at least a half-dozen counties and entry into the multifamily apartment market among them — Nunn and the leadership team will have to continue its counterintuitive ways. 

The expansion announcements, including a leadership reorganization, come at a confounding time for homebuilders. 

On one side, demand for housing in Florida, from entry-level to luxury, remains off-the-charts insatiable. Consider a survey released in July from real estate tech firm Redfin, one of many that could fall under the simple headline “Florida homebuilding is hot.” That report, looking at national migration data, found that the Tampa-St. Petersburg-Clearwater, North Port-Sarasota-Bradenton and Cape Coral-Fort Myers MSAs all made the list of top 10 metro areas homebuyers are moving into. “It is an exciting time to be a homebuilder in Florida with a demand for housing that has not been seen in decades,” Nunn says in a statement announcing Homes by WestBay’s expansion. 

“Tampa is under-sheltered, really all parts of Florida are under-sheltered,” Nunn adds in an interview. “I see tremendous opportunity.”

Yet this opportunity comes against the backdrop of rising interest rates, high inflation and significant cost increases on the supply side, with some construction materials up 30% or 40%. While Redfin looks at yearlong migration figures, some fresh data tell a different story. One example? In August there were 6,825 new residential construction permits worth $2.1 billion in Florida, according to Home Builders Weekly, a construction permit data service. The 6,825 homes, HBW reports, represent a 22% month-over-month drop in home construction activity.  

Nunn isn’t blind to those conflicting forces. “I worry about everything all the time,” he says. “I worry about what I don’t know.” 

Nunn also knows Homes by Westbay didn’t get to its current spot by sitting back and waiting for a market to change. This is a company, after all, founded in 2009 while the housing market crumbled around it. Area builder Roger Gatewood started the company and soon brought on Nunn, who had been an executive with Bank of America and Centex Homes, as president. For a time, the business operated out of Nunn’s den, and later six people worked out of his three-car garage.  

“I’ve run into the burning building every time,” says Nunn “You can’t wait for it. You can’t wait for it to get better in three or four years.” 

Wide spread

That leads Nunn to the transformational announcement earlier in October: Homes by Westbay and its lower-price point subsidiary, Casa Fresca Homes, will break into “two separate operating divisions to manage its current and future assets for increased market share throughout Central and Southwest Florida.” 

One division, WestBay North, includes the homebuilder’s legacy business in Hillsborough and Pasco counties, with active projects such as Hawkstone, Triple Creek, Creek Ridge, Waterset and Mirada. WestBay North will drive expansion in Polk, Hernando, and Marion counties, the company says.  

WestBay South, meanwhile, will focus on luxury markets in Manatee and Sarasota counties and oversee expansion into Charlotte and Lee counties over the next several years. Homes by WestBay has been active in these regions, catering to empty nesters, active adults and growing families. Initially, WestBay South will include the neighborhoods of North River Ranch, Crosswind Point, Crosswind Ranch, Star Farms in Lakewood Ranch and Wellen Park in south Sarasota County.

Nunn and Brian Bullock, who has been with the company since 2013 and is part of the original management shareholder group and leadership team, say there’s a practical reason, beyond supply and demand, to expand: Hillsborough County is quickly running out of land for homebuilders to put together projects. Nunn says the window, at most, is three or four years. “We know we can’t build in Hillsborough anymore,” Bullock says. 

Bullock will retain his role as vice president of sales and marketing, while also being named WestBay North division manager. His counterpart division manager at WestBay South is Dee Crescini, who is also vice president of design and part of the original management shareholder group and leadership team.

Photo by Rob Harris

A big benefit of moving into new counties with a recalibrated leadership structure, say firm executives, is proximity to projects. Now leaders and project managers can spend less time in the Riverview headquarters and more time in the field — where they can see and touch projects, and help solve problems. The company has 17 model centers for its projects, spread from Venice to Ocala. “We felt as though our leaders and managers were spending more and more time in the car,” Bullock says, “and that takes you away from seeing your people.”

Family minded  

Another side of the company’s strategy lies not in homes, but apartments. 

Nunn leans on his banker’s analytical mind to conclude a market shakeout in the seemingly never-ending multifamily boom is coming — and soon. “We see opportunity, as institutional investors withdraw from the space due to changes in capital markets and the tremendous excess supply that’s coming,” he says, 

So, like Homes by WestBay did during past down-cycles, it’s looking at the overbuilt apartment market as a chance to grow. That could be new projects or acquisitions, Nunn says. “I’m looking for apartment people,” he says. “It’s been on my mind for a while.”

It’s another bold move, given not only the opportunities in single-family-homes, but the recent past: Revenue has increased 110% in four years, for example, from $268.5 million in 2019 to $564 million in 2022. Homes by WestBay and Casa Fresca Homes combined built nearly 1,000 homes last year. In addition, while Nunn projects Homes by Westbay will be mostly flat in new builds in 2024, he estimates Casa Fresca will increase its new builds at least 75% next year. 

Achieving that growth will require navigating both homebuilder specific challenges, such as permitting, and standard business challenges, like hiring and retaining top people. On the former, Nunn says learning the permitting nuances of all the new counties is a No. 1 worry. “It’s not what you know,” he says, “it’s what you don’t know that can hurt you.” 

On people, the company, with some 200 employees, recently hired a full-time recruiting person, for managers and all levels. Nunn, 58, says building a group of future leaders is now one of his primary responsibilities. He works with an outside leadership development coach on that, while also marveling at the team already in place that makes Homes by WestBay hum. “I’m amazed at the talent that has chosen to join our team and organization we have built,” he says. 

One other thing Nunn tries to remember to do as the company executes on its big goals: to not be a bottleneck. “I try to stay in the big picture,” he says. “and stay out of everybody’s way.”