What 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!
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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.
- Previously in Swamplot: The Real Reason Royce Builders Home Sales Were in the Toilet, Royce Builders: So Hard To Say Goodbye, Royce Builders Sales Staff Update: Never Mind the Rumors, Sell Sell Sell!, Royce Builders Death Spiral: Juicy Details!, We Have Layoffs: Heads Roll at Royce Builders, The Rumors Circling Around Royce Builders
Photo of Royce Builders offices at 7850 N. Sam Houston Pkwy. West: Stewart Title