S.F. Developer to Buy Akins Cos. for $9 Million in Stock : Real estate: Catellus will acquire local home builder, and the new firm will be based in Irvine. No layoffs are planned.

IRVINE — As part of ongoing consolidations in the local real estate industry, a San Francisco developer on Thursday agreed to pay $9 million in stock for the Akins Cos., a longtime, family-owned Orange County home builder.

Publicly traded Catellus Development Corp., with $1.8 billion in assets and extensive land holdings, agreed to purchase the 47-year-old Akins Cos. The new company will be called Catellus Residential Group and will be based in Irvine.

Founded by Ed Akins and run by his two sons, the Akins Cos. is one of Southern California’s larger home builders. It has constructed nearly 10,000 homes in the Southland, among them residences in Mission Viejo, Rowland Heights and Tustin. Last year it sold 640 homes.

Like many builders, Akins has suffered in the real estate downturn. It survived by finding joint-venture partners and hiring itself out for a flat fee to build housing tracts for other developers. Last year, it reported $95.4 million in revenue.

“It’s really been a goal that we established to align ourselves with a company that could provide the dollars we need to grow our business,” said Bruce Akins, 44, company president. “We have access to Wall Street now. The world has evolved, and having as many options open just gives you more stability.”

Bruce Akins will remain president of the new company. His brother Carl, 47, will remain chairman. No layoffs are planned.

The purchase will not have any affect on the real estate partnerships created by Akins in recent years, he said.

More specifically, a partnership formed in April with Newport Beach developer Koll to build more than 3,300 homes in the controversial Bolsa Chica wetlands project will continue as planned, he said. Called Koll/Akins, the joint venture is still the master developer for that site, he said.

“We hope that the added strength we bring with Catellus will make that [partnership] even more viable,” Bruce Akins said.

Catellus stock closed unchanged Thursday at $6 a share; the news was announced after market close.

“It was an ideal fit for us. We have a lot of land for residential opportunities but didn’t have the home building expertise. They do,” said Stephen Wallace, a chief financial officer at Catellus, which also owns major office buildings in Anaheim and Union Station in downtown Los Angeles.

“I got a great, clean company and smart people,” he said.

Catellus also owns 70 acres in Buena Park, where the new company will first begin building, and an additional 682 acres near Stockton in Northern California.

Analysts said the move is part of a consolidation wave sweeping the badly shaken Southern California real estate industry as many small home builders find it hard to obtain needed capital.

“We are going to see a revolution in the way home building is done in California. And this purchase is part of that,” said Al Gobar, a real estate consultant in Brea. “Home building will soon be just a commodity. And a few major companies that operate nationwide will do it.”

Founded in 1948 in Pacific Palisades by Ed Akins when he was just 23, the company was originally a custom home builder.

“Dad always enjoyed building. He wanted to build the family a home in Pacific Palisades. That’s how he got started,” said Bruce Akins.

In 1951, Ed Akins moved the company to Tustin, where a revolution in tract housing was underway. Akins jumped on the bandwagon.

“It was really the birth of tract housing,” said Bruce Akins.

Bruce Akins, who began his career in real estate sweeping out homes for his father, began working full time with the company in 1973. His father, now 70, retired in 1981 and lives in San Juan Capistrano.

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Real Estate Merger

The Akins Cos., an Irvine-based real estate firm, has been acquired by Catellus Development Corp. of San Francisco. Details on the two firms and the merger:

THE AKINS COS.

Headquarters: Irvine

Business: Real estate development, home building and project management

Chairman: Carl Akins

President: Bruce Akins

Employees: 110

1994 sales: $88.3 million

Purchase price: $9 million in Catellus stock

CATELLUS DEVELOPMENT

Headquarters: San Francisco

President/CEO: Nelson C. Rising

Employees: 205

1994 sales: $156.1 million

Merger effective: First quarter, 1996

New name: Catellus Residential Group

Source: Catellus Development Corp.

Los Angeles Times