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2008-02-06

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stories: ajc.com

The Atlanta-Journal Constitution recently posted a piece concerning John Wieland, who has recently suspended construction on a $350 million luxury condominium project in midtown Atlanta. As there is no shortage of condos in midtown Atlanta either in the process of completion or having been recently completed, we believe this was likely the right decision.

Per the AJC article, John Wieland has been "shocked" by the downturn in housing. The AJC notes:

"The end of last year was the most miserable time of my life," Wieland said.

...

"I am shocked, and I don't shock too easily," he said. "I don't know anybody out there that is 'doing well.' And the bankruptcies of the builders in Atlanta are starting."

But a new promotion offering price discounts up to $100,000 and a lifetime structural warranty on Wieland houses produced 89 sales for the company between Jan. 25 and Feb. 3, twice the number of homes the company sold in the same period last year, according to Wieland officials.

Though the steep discount was able to drive up sales for Wieland, the company is still marketing some 30 communities and over 400 homes still in inventory. Regarding ongoing sales at Wieland, the AJC notes:

"It takes more visits these days to get people to make a buying decision than it did a year ago," Wieland said. Currently, he said Wieland buyers are averaging 71 days between first contact and purchase commitment, up 29 percent from the 55-day average a year ago.

The Atlanta area has some eleven months in unsold inventory. Despite the downturn, Wieland believes his company will survive.

And we'll be watching to see how it all plays out.

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Important: Ailing Builders haven't shut down, but they've suffered significant valuation declines, temporarily halted redemptions, or faced other major business hurdles. Builders on watch may not even have unusual declines relative to peers, but may be posted if it is felt there may be risk of developing a more serious condition in the near future.