Dallas Firm Agrees to Buy Small Builder

As part of its push to expand in Southern California, Centex Homes of Dallas has agreed to acquire Aliso Viejo-based Pacific Gateway Homes.

Centex officials drafted a letter of intent Wednesday evening to purchase the small builder from Canadian developer Ken Field, Pacific Gateway President Rita Lamkin said. Terms of the deal, which is expected to close in August, were not disclosed.

The deal would give Centex access to 626 residential lots in Corona and Pico Rivera--land it needs to expand its operations, which are concentrated mainly in the Inland Empire.

Sources close to the deal say few of Pacific Gateway’s 30 employees will join Centex, except Lamkin and Operations Vice President Jim Guccione. However, Lamkin said those details have not been worked out and insists no employees have been informed that they would be out of a job.

Pacific Gateway was formed in 1989 by Field and former Mission Viejo Co. executive Harvey Stearn. Last year, it was Southern California’s 27th-largest builder, constructing 300 homes and racking up $55.3 million in annual revenue from projects in Aliso Viejo, Orange and Corona, according to The Times’ annual home builder survey.

Centex was much larger, ranking fourth with 1,224 homes built and $255.5 million in revenue. The home building giant first announced its intention to expand in the Southland last month, when it hired a new division president, former Kaufman & Broad executive Roland Osgood. In recent years, small home builders like Pacific Gateway have had an increasingly difficult time competing with the large publicly traded builders that have flooded the market. Many have been swallowed up or have gone under.