Mobile Home Builder Fleetwood Sees Stronger Sales

Riverside, CA, July 27--Fleetwood Enterprises plans to double its mobile-home manufacturing space in the Inland Empire by leasing a 96,550-square-foot factory on 13 1/2 acres in Perris. The Riverside-based company had been looking for more Southern California space for some time, said Kathy Munson, Fleetwood's director of investor relations. "This is one of the hot markets for manufactured homes, but we haven't been able to take advantage of it because we didn't have enough capacity," she said. Although Fleetwood's Riverside factory, at 7007 Jurupa Ave., is the company's third largest manufactured home plant with 309 employees, it is too small to handle the demand, and there is no room there to expand it, Munson said. The factory, located at 804 S. Redlands Ave., is owned by Perris Holdings Limited Partnership, a company run by Harry Clark, the founder and former chief executive officer of Turnkey Inc., a now-bankrupt prefabricated classroom builder. Clark built the $5 million, state of the art facility, known as Perris Academia de Respeto y Communidad, or PARC, in 2003. Turnkey, which was based in Temecula, used the factory until January when the company went out of business. "I think they are going to do well there and enjoy it. It's in spectacular shape," Clark said, adding that Fleetwood plans to make some minor changes that may take several weeks. "They are expecting to have at least 250 employees there." Financial terms of the five-year lease weren't disclosed. Perris is also home to Modtech Holdings, a prefabricated classroom builder, as well Golden West Homes, a subsidiary of Knoxville, Tenn.-based Clayton Homes, one of the country's largest manufactured home builders. "The manufactured home and recreational vehicle industries are hugely important to Perris," said Michael McDermott, the city's real estate services director. "It is certainly a large percentage of our manufacturing and overall job base." RV builders National RV and Weekend Warrior are also based in Perris. There are only a limited number of companies who could have used it, McDermott said. Fleetwood, which is one of the nation's largest builders of both manufactured homes and RVs, announced two weeks ago that it plans to sell most of its mobile home retail outlets to Clayton Homes, which is owned by Berkshire Hathaway. Fleetwood has made mobile homes for decades and began selling them through its retail outlets seven years ago. The industry experienced a major slump and the Fleetwood subsidiary never made money. In March the company changed its top management and is now focusing on manufacturing. Fleetwood lost $161.5 million, or $2.92 per share, for the fiscal year that ended April 24. It was the fifth consecutive unprofitable year for the onetime Fortune 500 firm, which has lost more than $700 million since 2000.

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