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Regency lays off workers, no word on Storm Lake condos

Monday, April 28, 2008

Iowa's largest homebuilder, Regency Homes Inc., laid off all its employees except for top management in its homebuilding and land development companies Friday.

Regency Commercial Services owns the stalled Sunset Bay Condominiums project on Storm Lake's city golf course, where the project has not been touched since September of last year.

Regency officials have not returned calls to the Pilot-Tribune.

A letter addressed to friends and partners of the West Des Moines-based privately held company said 103 employees were told Friday afternoon they had been laid off.

It was unclear whether the company planned to halt construction, according to the Associated Press.

In the letter, Regency said it is working with financial advisers and legal counsel on the issue of vendor payments and other cash obligations "that our current situation does not allow us to fulfill."

"We do believe that our equity outweighs our current obligations," according to the letter, which was obtained by The Associated Press.

The company has been struggling for months and laid off 26 workers in January as the housing industry slump hurt homes sales.

Then, company officials said the home building business had shrunk by about 40 people - nearly half - over the past two years.

The company reported in January that it expected to sell 550 houses this year, a 43 percent decline from the high of 2005 when 1,000 homes were sold, a record for any single home builder in the state.

Regency was founded in 1986 by Michael R. Myers and Richard D. Moffitt, who joined their individual building and carpentry companies into one company. It builds single family homes, condominiums and town homes ranging in price from $170,000 to more than $600,000.

Company officials indicated earlier that several units in the still-to-be-built Storm Lake project had been sold. Others have bought single-family homes yet to be delivered.

In addition to the Des Moines market and Sunset Bay, Regency serves other areas including Cedar Rapids, Iowa City, Ames and Cedar Falls.

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