17 Problems with Royce Builders: Lavish Spending, Loose Keys, Roaming Rats

Royce Builders Building, 7850 N. Sam Houston Pkwy. West, HoustonWhat caused last week’s big implosion over at Royce Builders? And what’s happening now? A Swamplot informant tries to clue us in with this rich, extended view of the company’s problems:

Fact #1: Lavish spending by all of the Speers. At any given time one of two Bentley’s, Ferrari, Escalade or sports cars belonging to the family would be parked at the office. Shawn Speer and his wife Shonna were known for bragging about their lavish spending. Certainly, if you’re making money spend it, but when times are tight they were the only ones still spending money like water.

Fact #2: Example: Shonna told another employee about $30,000 shopping spree to New York and only a purse and few other items were on that steep tab.

Fact #3: As employees were crying and leaving Shonna and her best friend and manager Nicki K. were talking about moving forward with their new clothing line. This conversation opened up speculation that monies had been moved to accounts in Nikki’s name for this purpose.

Oh yes . . . there’s more!


Fact #4: Lack of management skills – 98% of the management were either in the wedding of the Shawn or Shonna, buds from A&M, or partying pals. All were young and inexperienced with leading. They did not hesitate to management by intimidating and name dropping that they were close friends of the Speers. Non of this management team ever had any building or management experience and therefore trades were not managed correctly resulting in poorly constructed homes.

Fact #5: Sales people were treated to trips to Europe, Mexico and the Las Vegas last year when things were tight. Certainly, the sales people made the Speers a lot of money, but cash was handed out like water for spending. The lack of leadership in all areas played a huge part in their demise.

Fact #6: The first clue that there was a problem was when they said to stop selling dirt and to tell your buyers on dirt that they needed to move to inventory. This was disturbing because buyers had already went to the Design Center and paid their deposits for upgrades. People also made conscience decisions about where they want to live. So, just telling them that their home could not be built was a problem. Never once did they sit down with sales to openly discuss the situation or even to talk about a goodwill approach. All sales was advised was to keep selling. Questions arose about our financial status. Still, everyone was told to keep selling. They knew that the financial condition of the company was unstable, but yet the continued to accept EM from buyers. None of these buyers will ever get their EM back.

Fact #7: They owe all of the employees money. They paid all hourly and salaried employees 1 week only. No vacation time on the books were paid, nor overtime, nor the 1 week that they owed since everyone gets paid for 2 weeks. Sales did not get the majority of their commissions.

Fact #8: At the meeting [last] week we were told to continue to sell. They did not know where the homes would close, and they could not guarantee that sales would get paid. They said that the banks were in control of everything. They basically did not know anything other than they wanted us to sell.

Fact #9: There are only 10 employees left in the company and they do not know if they are going to get paid.

Fact #10: They laid off over 150 employees for which at least 60 have keys, they had 75 sales people and most are gone with keys, most of the vendor supervisors have keys. Numerous calls are coming in from Realtors around the city noticing that properties are missing doors, tiles and anything that can be taken out is being removed. They owe the vendors millions and they never took a single key back.

Fact #11: The grass is so over grown on their lots, models and inventory that neighbors in all communities are complaining about the large rats that are now roaming all over the place.

Fact #12: Shawn Speer and Shonna Speer with no management background were both a joke. There was never a feeling of business as usual at the office from the time Shawn took over. It was more of a party atmosphere and the employees that they hired love[d] it. As soon as people got a sense of what was going on they left. Those that stayed were constantly being dangled a carrot or more money and more trips.

Fact #13: Shonna sent an email [a few] days ago telling everyone to stop sending out updates to the different blog groups. She was pissed from the tone of her email.

Fact #14: They have started to call people asking if they know if anyone is taking things from the models or from the inventory homes. They owe the entire planet and the rest of the planet has keys. I do not know of one single salesperson that has been in a model home or trailer in weeks. Everyone can log on from home and check email’s. No one is stupid enough to sell anything.

Fact #15: They let the gazillion year lease on their corporate office go over two weeks ago and it was leased to another firm. This firm came in and started making plans for the office space while Royce employees were still sitting at their desk. Employees started asking questions and all management said was they did not know. Also, this sale day a guy came in with a moving van and told the purchasing dept. that he had just bought the phone system. Again, management had not told one single person about anything. They laid all the entire office only giving severance packages to their management friends and all of the loyal, long time employees got one week. . . .

Fact #16: The Speers should be ashamed of the way they violated the trust of buyers and left them holding the bag. . . .

Fact #17: We were told to sell and that a disclaimer was being added to the contract which states that some other entity will be taking over before the closing and that the home is being purchased as is. It goes on to state that there is no guaranty of warranty or anything else. Whatever needs to be added to complete the home, but buyer must do it themselves. Lastly, Shawn told everyone that there are no more homeowner walks or warranty calls.

Photo of Royce Builders offices at 7850 N. Sam Houston Pkwy. West: Stewart Title

14 Comment

  • Well isn’t that just peachy…..

  • This sounds an awful lot like the bad business practices of one of the owners of another, now defunct, residential construction company, Savoy Custom Homes. Even though they built luxury customs. It makes you wonder if maybe they attended the same school of thought.

  • This one just keeps getting juicier and juicier.

  • Sheesh.

    It always amazes me how some people are able to survive as long as they have doing the things that they do.

  • I went to high school with that Shonna girl and she was a joke. She got around if you know what I mean. I also met her husband Shawn and I didn’t think he could tie his shoes by himself. He may be the dumbest sounding person I have ever met.

  • if the Speers think they will get away with ripping everybody off they have another thing coming and the gophers they have hanging around the office who have taken over Hammersmith will get their just deserts as well, completely sickening how many good employees were literally thrown to the wolves by Royce, we know where they all live so if they think they can hide from the law they seriously have another thing coming

  • Is the insider a 12 year old?

  • Why would anyone continue to work there? Sounds like some folk could be considered as committing criminal fraud… selling stuff that don’t exist? Is anyone under investigation?

  • Shonna is a wicked person who I believe is the reason Royce fell apart. What goes around comes around. Her trip to the bottom is going to be painful and I can’t believe Shawn ever bought into that girl. He and his family like everyone else, should have known better. How did scum like her ever end up at Royce? It used to be such a great place to work.

  • i am one of the people now stuck with a royce lemon that i bought back in march and i need help does any one out there know anyone who can help me with getting royce to finish my home there are so many problems with my home i wouldnt know where to begin help please anyone my email is ssgtbryanlee@live.com

  • bryan,

    Royce is out of business. Doors closed. Finished. Done. There is no one to ask about anything. You could hire a lawyer, but it would be a waste of your money. Sadly, you are on your own.

  • based on comments on a newer post, i thought i would respond to my experience with royce after several years selling homes for a living with royce. i question the person that posted this as what they post is versions of happenings that anyone there would never had said, but here we go (and i won’t use the term “fact” for reasons you will see):

    1. saw escalades (who puts that on the same level as ferrari and bentley? – even more, when has a day gone by that you haven’t seen an escalde?), saw a bentley a couple of times, never saw a ferrari, but did see a yellow porsche. these cars weren’t new and i saw them a couple of years back and occasionally over the years. i think i saw the bentley a couple couple of times over the years – it was blue, and a porsche a couple of times, like i said, yellow. as for other sports cars, not really sure, typically we were at the office at least twice a week for meetings and then once a week unless we had business there. by no means did the parking lot look like a high end auto business

    2. nyc trip was a company sales trip not a shopping spree. several sales people went who won the contest. i never heard a word about a purse or any other high-end item like that. i would love to see what a $30k purse looks like – once again trumped up bs

    3. clothing line? what are you smoking? monies being moved? like that couldn’t be traced……it seems to me that someone who worked for nikki could at least spell her name. i’d love to see the clothing line by the way, unless it is in the backyard of someone’s home. here we are several months later and i still haven’t been invited to a fashion show. let’s see – my bs monitor is buzzing and glowing bright red

    4. i worked directly for shawn for a period of time and indirectly for shonna for quite a while. i have no idea what you are talking about. any problem i ever had was resolved by the handbook (even though i didn’t always agree) and both of them worked there for over 10 years each as employees. both of them were the face of royce and the statements about the “buddies” and “wedding friends”, if you are in this business long enough, it seems the only friends you have are the people you work with since you spend so much time there. as for poor construction, refer to my comments about dale phillips inspections. are you saying his company compromised the level of quality to be “cool”? give me a break

    5. when was there not a sales trip offered by royce? we had one at least twice a year. there were continued benchmarks to earn spending money for the trip. if we weren’t given the trip, all the sales people would have been a little more than mad. i doubt that actually making sales to qualify for a trip would cause anyone to meet their demise

    6. what are you talking about? we received more points for the contests for spec sales vs dirt. furthermore, as a sales person, we made money faster for spec sales. if a company is carrying a larger than wanted spec inventory which costs money every month it isn’t closed, why wouldn’t they focus on spec inventory. i’ll also say that with loan programs disappearing everyday, why would you gamble on a 6 month out closing when you can get one today. if you believe this statement and if you really worked at royce, that should be reason enough why you shouldn’t have been there.

    7. as a sales person, i was paid what i was owed. as for vacataion and perk pay, the company went out of business. what is there expected? how many people do you know that got paid that much from a company that was closing the doors. i am not justifying, but since earlier this year, everyone knew that they were on borrowed time unless the economy turned around

    8. i like how you use “us”. you clearly were NOT there nor were you a sales person who had been with royce for any period of time. what was said is that were uncertainties as to how everything would close. seeing as it was uncharted territory, we would be kept informed, which we were, if you showed up to the meeting.

    9. hard for me to say since i am posting at a later date, but the last employees weren’t unceratin of their pay or position. silly statement

    10. obviously, YOU are the person they should have gotten a key back from. it’s funny how you acuse them of all this stuff and make comments of people wioth keys like you that steal. anyone in this industry knows about master keys and how they work. if you don’t, i’m not going into details here

    11. WOW!!!! are you serious??? the company is closed, did you expect their lots to be mowed for free? where do you think those rats came from?

    12. don’t know what you are talking about again, yes there were trips and i loved the fact that i had oppurtunities to go to places i hadn’t been before. i worked hard for the trips i won. i never had the types of experiences you mention interacting with either shawn or shonna

    13. this is how i know you ARE NOT A ROYCE SALES PERSON. shawn sent an email and talked publically about the fact that false statements were being posted on the internet. if you wanted to post something based in fact fine, if not, i believe his words were “please leave, you are not helping. you are keeping many people from getting paid the money their hard work has earned”. the people he specifically referenced were the labor/trade people and the sales people.

    14. i don’t know you talked to, but people stayed and tried to sell AND CLOSE until the end. once again, should you have been trusted with keys?

    15. i have no idea how long a lease was for. what i do know is in the last 12 months, the building had a lot of unused space. i saw , but haven’t verified, that they had over 40,000 sq ft of space. in all of 2008, many offices were empty. if you try to pass judgement on the sales trip expenditures being un-needed, why would you pass judgement in the other direction about the office space being leased. once again, do you really know what you are talking about?

    16. i can’t say who should be ashamed of what. what i do know is that they are still trying to get people paid. if they should be ashamed of anything, it is holding onto people like you for as long as they did. i imagine YOUR salary would have helped pay some of those bills

    17. WE were told that homes that closed would include commissions to us. i got paid. did you close anything? i doubt it, because you obvisouly weren’t there to hear what was said. the statement you make about what shawn said are false. i am not going into details here, but anyone that was at these meetings will agree that you have no idea what you are talking about.

    sorry to get all this stuff off my chest in probably the longest post in response to a swamplot “tip”.

    these “facts” are just wrong and ridiculous in nature. sure, i see the john speer home is up for sale, doesn’t that say just about everything that needs to be said? royce was a great company and i was always treated fair. i look forward to finding another place to work that i can have just as much fun as i did at royce.

  • “these “facts” are just wrong and ridiculous in nature. sure, i see the john speer home is up for sale, doesn’t that say just about everything that needs to be said?”

    Market – 3,349,311
    Appraised – 2,685,410

    9.8 mil is almost 3x more than the market value.
    The fact backing that up : http://www.hcad.org/records/details.asp?tab=2&bld=1&card=1&taxyear=2008&acct=0460490000035

    I have to ask myself these questions.

    Does the seller want to sell this home?

    Why would the seller ask such a high price in such a weak market. “fact” HCAD market value is $3,349,311 NOT even close to the 9.8M asking price

    Would it be better to use this address to set-up a new business?

    Don’t know but here’s a known “fact” about the new Speer business

    http://www.ghba.org/source/Members/cbc_list.cfm?area=se *just scroll to the bottom of this page

    HCAD address for Mr. Speers home he is selling:

    John Speer
    16427 Telge Rd
    Cypress, TX 77429

    Does he want to sell it? I will let you answer this since you were formerly part of the Royce sales team.

    My View:
    One might admire the desire to pay back those who deserve it, but this effort really leaves much to be desired

  • People, I know the facts, I served on the jury. He will have to pay what he owes. Problem is , the people won’t see a red cent. He is scum and you realize that when he opens his mouth. If you have a claim you need to contact the trustee Rodney Tow.