The Pardee family may no longer be at the helm of the company founded by George Pardee in 1921, but according to Mike McGee, Pardee Homes' president and CEO, the family's business philosophy and spirit are still very much alive in what is now a subsidiary of Weyerhaeuser Real Estate Co. (WRECO).
"We've always been perceived as a family company and focused on being a builder of homes for families," said McGee, who joined Pardee Homes as a project manager in 1988. "We come to work every day and see the Pardee name and say, 'That's the legacy and name we will honor.'"
McGee earned a bachelor's degree in business administration from the University of Southern California and a J.D. from Southwestern University School of Law. He is also a graduate of Harvard Business School's Advanced Management Program and UC Irvine's Light Construction and Development Management Program. Beginning his career in commercial and industrial real estate, he gravitated to homebuilding because he found the environment more creative and rewarding.
"I enjoyed affecting people directly in the homes and communities in which they lived," McGee said. "I love the fact that what we build at Pardee will be here long after I'm gone, and that we conceptualize an environment, develop and build it, and people make it their home. That's tremendously satisfying for me personally -- to give a person a home or a community that gives them a sense of security and self-worth."
Named "Homebuilder of the Year" by Builder and Developer magazine in 2003, McGee's experience includes a 22-year tenure with WRECO. The company purchased Pardee Homes, originally known as Pardee Construction, in 1969. Today, Pardee Homes has 740 employees and is WRECO's largest wholly owned subsidiary.
In San Diego, Pardee focuses primarily on building single-family homes, though attached homes -- both apartments and condos -- make up between 10 percent and 20 percent of its volume. Last year, the company's gross sales in San Diego were $416 million, while its overall sales were $2.1 billion.
According to McGee, key characteristics that distinguish Pardee Homes from the competition and have contributed to its success include being careful about the markets it chooses, committing to those markets for the long haul and offering a broad range of products from apartments to luxury homes.
Long after Pardee homes are sold, the company continues to be actively involved in the communities it builds. Pardee regularly sponsors events such as 5-K races, for example, to raise money for schools or charitable organizations. Pardee employees participate in community planning boards, and some also work and live in Pardee communities.
"Having our own employees living and working in Pardee communities provides them with stability and creates a continuing connection between us and those communities," said McGee. "We have a number of employees who started their career with us living in one of our apartments, and then went on to buy a condo, then a single-family home and ultimately end up living in a larger, more luxurious home."
In addition to more obvious factors such as employment driving the demand for new homes, McGee said that in San Diego there are other more subtle factors at work, including what he refers to as the "psychology of aspiration." People who live in highly desirable cities like San Diego tend to do everything in their power to stay employed and raise their family there while enjoying the best possible lifestyle, he explained.
"People who buy homes in San Diego are constantly looking for opportunities to upgrade to a better house or one in a different neighborhood," said McGee. "It's really tied in with consumer confidence. When they have a sense of well-being about where they live, when they feel good about things like job security, the schools their kids are in and opportunities for recreation in the area, then they can feel good about reinvesting their hard-earned dollars in a new home."
McGee added that people who buy new homes are looking for communities with more amenities than those typically found in older communities. The opportunity for their children to attend a particular school, avoiding the hassle of remodeling an existing house and being able to take advantage of the latest in housing design also make new homes appealing to these buyers.
And with more design options and amenities to choose from than ever before, buyers are no longer limited to the cookie-cutter features and looks typically associated with new homes in the past.
"This is probably the biggest change I've seen in the new home industry in the last 10 or 15 years," McGee said. "Buyers used to come in and have two choices for customizing their homes -- white or almond appliances and the chance to upgrade to mirrored wardrobe closets. Now, with new materials and methods in construction, together with the ability to make many choices via our Web site, we can offer extensive choices in materials and the manner in which they're installed, so customers truly have the opportunity to individualize their new homes."
Like other homebuilders across the country, Pardee is feeling the impact of a diminishing demand for new homes, dwindling land supplies and increasing materials costs and rising interest rates.
To manage increases in raw materials costs, McGee said Pardee tries to work closely with its suppliers to accurately forecast demand for products and to take advantage of short-term fluctuations in costs when possible. Though higher interest rates are keeping some consumers out of the new home market, McGee pointed out that rates are still relatively low.
Though McGee described the environment in which Pardee does business as "complex," he seems to take the challenges in stride.
"We're building a complicated product," he said. "After going through a very complex and lengthy government approval process, you realize that you are probably building for someone the most expensive product that they will ever buy. You come up against many diverse challenges throughout the process. But I find it all exciting."