Watt Housing Unit Sold to British Firm : Deals: Recession had squeezed the Santa Monica-based home builder. The sale is worth $116 million.

Santa Monica-based home-building giant Watt Enterprises said Thursday that it sold nearly all of the assets of Watt Housing Corp., a subsidiary, to British-owned Beazer Homes for $116 million.

Watt Housing said the sale includes about 3,800 lots on 44 tracts, including 19 in Southern California and 17 in Phoenix.

Beazer is the U.S. subsidiary of Hanson, Britain’s third-largest home builder. It also owns Jacuzzi Whirlpool Baths and Farberware Cookware.

Ray Watt founded his company in 1948 with a small crew of construction workers and a battered pickup truck. He has since built more than 100,000 homes in Southern California--mostly in the San Fernando Valley and Los Angeles’ Westside.

One of the largest and most prosperous of Southern California builders until well into the 1980s, the company fell on hard times several years ago when the recession took hold and home sales slumped.

The downturn caused lenders to cut back on loans for new developments and left hundreds of developers scrambling for cash.

Watt, who will remain chairman of the company, acknowledged that his firm “had felt the effects of the credit crunch.” The $116 million will shore up his balance sheet and make it easier to get new loans for projects, he said.

Watt’s various companies built more than 2,000 homes a year and rang up more than $500 million in annual sales throughout most of the late 1980s.

It was consistently among the top 10 largest builders polled for The Times’ annual home-building survey.

But Watt sold only 949 homes last year for a total of $165 million. Atlanta-based Beazer sold 1,182 homes, mostly in the Southeast, while its British parent company built nearly 5,000 homes in the United Kingdom.

Thursday’s announcement came just three weeks after another big builder--Woodcrest Development in Irvine--asked a bankruptcy court to liquidate four of its development partnerships.