Question-and-Answer Session
Operator
[Operator Instructions]. Our first question will come from Chris Haley of Wachovia.
Chris Haley
Good morning gentlemen.
Wm. Britton Greene
Hey Chris.
Chris Haley
Two questions, if I can. First, could you offer a little bit of color on the contract that fell through? Was it financing contingent, was it a buyer that you had in the past? I’d just like to little bit understand what changed and how that may have been underwritten? And then secondly, recognizing that we are still in a very slow period and to Britt's comments that when Florida comes back, you feel more enthusiastic, you can feel more enthusiastic. You do provide information regarding your margins and grow most of your activity going forward will be lot sale only versus vertical bills. Can you give us a sense as to where you think the long-term margins are for that type of sale activity?
Wm. Britton Greene
I will start with the first one, Chris. The contract was with the previous buyer of Joe lands. This is very non-strategic conservation oriented land. And it was frankly a result of the termination being a result of the buyer’s cost of capital and access the capital in the 11th hour that caused the termination. And given the timing of the closing in the capital markets at that time in early October, it was - they decided to terminate and to leave the contract. It doesn’t mean in the future that we won't sell to that buyer. They have been a good buyer in the past and I would expect would be in the future and understand the position they were in. I will let Bill maybe talk to margin. He has the numbers in front of him.
William McCalmont
During this year, Chris, on lot sales, we have seen resort margins plus or minus 50% and primary home margins plus or minus 20%. And that’s kind of the reality of our marketplace today.
Chris Haley
Today or is that when you kind of – when do your long-term positioning, long-term strategies, are those kind of the numbers you are settling on?
Wm. Britton Greene
Well, that’s today's reality. I think as we go forward Chris, in any one of the product points and price points, it will -- our lot pricing to builders into the retail market, I would expect in resort residential will work its way back, back towards where we were, but certainly not at '04 and '05 highs and I’d tell you that in the primary residential that it will take a while to get back to what we had sustained frankly prior to the collapse of the market rather than trying to pinpoint exact, I would say normalcy to lots not look like '04 and '05, but it’s not going to be as it is today.
- To read the full transcript on Seeking Alpha, click here »
