day 1 :: dog is my co-pilot

Well, today was the big day. Up and at 'em at 5 a.m., and out on the open road by 6. Lindy and I waved goodbye to the District...


...and set out on the first leg of our journey.



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First, just a short hop, skip, and jump over the Potomac into NoVa, followed by the more time consuming trek to Richmond.


Gotta love the ingenuity of Big Tobacco.

Eventually, we crossed the state line...


And made our way to Raleigh, N.C., to visit the Ohmann brothers.


First and foremost, I have to thank them for their hospitality and making not just myself, but my furry companion feel right at home. It was also refreshing to get St. Lawrence Homes president Bob Ohmann's perspective on the housing downturn. As it turns out, Bob and I happen to agree that home building has gone beyond a recession and past the brink of depression.

But it's a cyclical industry. Eventually, things will turn around. Just how the face of housing may have changed once recovery is reached is anyone's guess, but it seems highly probable that the landscape will be altered—and I'd bet hard money that it will happen on a submarket by submarket basis.

In the Raleigh-Durham-Chapel Hill metro, for example, it seems that smaller, local builders will come out of the downturn ahead in the market share department. Bob Ohmann noted that many larger production home builders have already exited the market in the face of slumping sales.

Seven years Bob's junior, Rich serves as company vice president. It was fairly coincidental that the two wound up at the same company—they had previously worked for separate home building enterprises—but the arrangement seems to work well. Although they share the singular ability of siblings to know just which buttons to push, any workplace disagreement is nothing that a night at home to cool off or a phone call from mom can't smooth over.

The passion and joviality shared by the Ohmanns makes it all that more depressing to discuss the company's Chapter 11 bankruptcy filing. In fact, Bob commented that 2008 marked the first and only year to date that St. Lawrence has failed to turn a profit—a somewhat distressing blemish on an otherwise remarkable record.

Of course, in light of market circumstances coast to coast, the very fact that St. Lawrence remained profitable in 2007 when so many of its peers failed to do so is a victory in and of itself.

One of my key takeaways was an affirmation of the fact that "bank" truly seems to be a significant 4-letter word. Not only in terms of deals falling through due to an inability on the part of the home buyer to obtain financing, the banks have become the villain due to their refusal to mark assets to market.

On the topic of net operating loss (NOL) carry-back refunds applied to taxes paid in a prior, profitable year, Bob pointed out that it's simply not an option for a smaller, privately held builder, as the banks push for personal guarantees on all loans.

Of recent bulk land sales on the part of the nation's large, publicly traded home builders where parcels were moved at a sizable loss in order to tap NOL cash, "They got their bailout," Bob said. "And you can quote me on that."

I could go on and on about my day with the Ohmanns, but it's getting late. And besides, tomorrow is another day. Another day, another blog, right?

After saying our goodbyes, Lindy and I piled back into the car...


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And now, I bid you goodnight from the heart of the ATL.


Sleep well, get up well.