06/20/14 12:00pm

Ad for Royce HomesBack in January of this year, the bankruptcy trustee assigned to colorful imploded homebuilder Royce Homes obtained a $9.3 settlement from Amegy Bank for the bank’s role in what attorneys called a $39 million conspiracy — to swindle creditors by draining the collapsed builder’s bank accounts shortly before Royce shut down and was declared bankrupt, in 2008. A separate settlement with Royce Builders’ founder, Michael Manners, was reached in March. And earlier this month, a jury in federal court returned a $27 million verdict against Royce’s former CEO, John Speer, for his role in the escapade. (Back in March, an earlier jury had ended up deadlocked on a number of charges.)

According to reporting by Law360’s Jeremy Heallen, the charges stemmed from what the attorneys claimed amounted to an off-the-books leveraged buyout of Royce Homes. In 2006, Speer bought Manner’s 50 percent stake in the Royce Homes for $33 million, to give himself complete ownership of the homebuilder. Though the funds used to finance the purchase (including a $20 million personal loan from Amegy Bank) were borrowed in Speer’s own name, Speers, Manners, and Amegy came to an understanding that Royce Homes would ultimately be responsible for paying them off, the suit claimed. The purpose of the scheme, according to the claims, was to keep the loans off of Royce Homes’s financial statements, because doing so would have “wiped out most of the homebuilder’s equity and caused lenders to shut down vital credit lines,” Heallen reports.


Amegy Bank and More
12/14/10 3:34pm

COMMENT OF THE DAY: ANOTHER WESTWOOD GARDENS WELCOME “Sylvia, welcome to the WG Homes community. I am very sorry to hear about your cats. Yes, there are stray dogs outside our community (the first trailer home on Gessner). It is very sad indeed. Yes, it does feel a lot like a community, and it is going to go uphill from now on. No looking back. Hope you enjoy your stay.” [Westwood G Resident, commenting on Westwood Gardens Still Life: A Photo Tour of Half-Built Houston Homes; previously]

07/27/10 11:42am

WHERE THE ROYCE LAND WENT The Bryan farm-lending coop that ended up with 618 acres near Tomball after the collapse of Royce Builders has finally sold the property — to the Caldwell Companies, a land development and investment firm. Royce had planned 1,261 home lots in Cypress Lake Crossing, which is northeast of the intersection of Telge Rd. and Boudreaux and only a couple miles north of the sprawling Cypress home of former Royce president John Speer. (Speer’s Royce-built compound off Telge Rd., pictured above, now serves as the home address of one of his new ventures, Vestalia Homes.) “Bill Heavin, a land broker at Grubb & Ellis Co., says Royce Homes had completed quite a bit of development work on the tract, such as soil and water testing and the establishment of Harris County Municipal Utility District #416. Royce Homes began seeking an investor or joint venture partner on the large tract in late 2006 or early 2007. . . . the asking price was $30,000 an acre, or $18.5 million.” [Houston Business Journal; previously on Swamplot]

06/24/10 10:36pm

A commenter on the TexAgs online forum is claiming that former Royce Builders vice president Shawn Speer called his supervisors and threatened him with the loss of his job. The fun started about a month ago when another forum participant, who goes by the name Comet*, complained online that workers constructing a house next door to his had been using water from his home without permission, leaving nails on the street and trash around the neighborhood. Comet* didn’t know who was building the home, but 2 days later, after several hours of phone calls, he received a call back from Shawn Speer. Comet*’s record of the conversation will likely be of interest to the many fans of bankrupt Royce Builders:

So I told him what was wrong, and he was extremely nice and will be doing a number of things to make sure that doesn’t happen. Went above what I expected, and I am very satisfied for now. No complaints at all anymore.

He said we’re not trying to hide who we are, I just ran out of signs, so that’s why there was no contact info on the lot.

me: So you’re just going by “Shawn Spears?”

s: Well, I have several companies and mentioned Travis homes as one of them (the only one I didn’t know Royce was working under).

But according to Comet* (or Comet*’s wife, who apparently also posts under the same account), the workers didn’t stop using the water spigot on his property. And then things started to escalate. Comet*’s wife wrote the next day:


04/01/10 3:40pm

COMMENT OF THE DAY: WHAT ROYCE BUILDERS SOLD ME “I bought a home from them in oct 2007 and got riped off. First I am still trying to figure out how I even got financed based on my income. I was making about $1200.00 a month and my notes where almost $900.00 a month. Then I have an adjustable rate morgage which would go up every 6 months. I thought about it after the fact (I had to give up my home) that they must have messed with the figures to get me in the home at the first place. I couldn’t get them to come fix things that come with the home warranty. If anyone knows what kind if any lawsuit is out on them would you please let me know.” [monmon, commenting on No-Charity Case: Royce Builders Education in Bankruptcy]

11/25/09 12:11pm

A few ominous tidbits from the website of John Speer’s latest building venture, Vestalia Homes, which makes no mention of Speer’s former company, Royce Builders — or the more than $17 million Royce still owes its creditors:

When it comes to homebuilding, we understand that it is not just about making the customer happy. As the expert, we are committed to doing the little things of which the customer may not even be aware. . . .

And on the “Build on Your Lot” page:

It’s about trust.

Trusting your land and your dream home to a builder is a major decision. Placing your trust in the right builder is more than just a matter of choosing a builder who intends to please you. . . .

Does the builder have a reputation for delivering results?

Vestalia’s partners and builders have decades of experience in delivering excellence in homebuilding. Our team has “seen it all” and we understand the importance of communication in building a custom home. Our team’s track record speaks volumes.

Photo of unfinished entry, 18522 Arlan Lake Dr., for sale: Vestalia Homes

11/25/09 8:30am

THURSDAY IS ROYCE BUILDERS TURKEY DAY! “There are dozens of homeowners, contractors and other consumers who lost money when Royce closed its doors. If you are one of these people or businesses, November 26th is the deadline for filing a “proof of claim” in Royce’s bankruptcy. If you file, you may be reimbursed when any of Royce’s remaining assets are distributed among creditors. There’s no guarantee you will see any money. But it’s a sure bet you’ll never get a dime if you don’t file. If you had a warranty on your home, but you haven’t been able to get the work done because of the bankruptcy, there is a value on the warranty that you are owed. If you put earnest money down on a home that never closed, and you never got a refund, you should file. . . . For now, the Royce bankruptcy trustee says Royce owes more than $17 million; but he believes it’s much more… and that many people just haven’t filed.” [Ask Amy Blog]

11/24/09 11:32am

Channel 2 investigative reporter Amy Davis sends a KPRC newschopper to buzz the 80-acre Cypress party pad estate of former Royce Builders president John Speer. More than a year after we featured the innumerable builder upgrades of that Mack-Daddy mansion on Swamplot, it’s still sitting on the market — for the same $9.8 million.

Meanwhile, less than a mile to the west, sales aren’t going so well either in former Royce Homes subdivision Grant Meadows:

“Houses are in disrepair. Fences are in disrepair,” explained homeowner Matt Adams. “The whole neighborhood’s been left in ruins.” . . .

Royce stopped paying the bill for the street lights in Grant Meadows in July 2008.

Reliant recently switched them off, and told homeowners they must pay the $14,000 owed before they can turn them back on.

“It’s pitch black out here at night,” said homeowner Evit Byrd, who planned to retire in Grant Meadows with his wife. “You can’t see anything.”

But there’s some good news: Speer has been building again! His new company, Vestalia Homes, which Speer founded 3 weeks after he closed down Royce, is busy constructing and selling homes a little closer to FM 1960, in a subdivision called the Lakes of Cypress Forest.


11/23/09 1:53pm

COMMENT OF THE DAY: THE ROYCE BUILDERS LEGACY “I think the real story is all the trades and other businesses who wound up getting stiffed out of tens of thousands of dollars in some cases. Royce was a poorly managed company… especially in its final year. They built an empire building houses on credit and pocketing entirely too much cash. When the loans on new starts stopped, Royce found themselves way over their heads in debt from the thousands of spec homes sitting on the ground. But the cash was in their pockets… so they walked out and left all the trades and homeowners to drown. Anyone ever stop to think how this effected small companies like Conkir Electric or all the painters and sheetrock crews who worked for pennies anyway?” [Former Royce, commenting on A Chance To Relive All the Excitement That Was Royce Builders]

11/20/09 7:03am

A CHANCE TO RELIVE ALL THE EXCITEMENT THAT WAS ROYCE BUILDERS Royce Builders alumni and victims: Do you miss all the intrigue that surrounded Royce’s implosion last year? KPRC Local 2 investigative reporter Amy Davis tells Swamplot she’s working on a story about Royce Homes and its various reincarnations. Got any news to pass on about former Royce subdivisions? If you have any information to share about Vestalia, WG Builders, or any other entities where former Royce higher-ups might have resurfaced, she’d like to talk to you. Just send her an email — she says you can remain anonymous! [Swamplot inbox; email]

05/21/09 10:40am

Regular Swamplot readers will remember all the fun surrounding the collapse and shutdown of Royce Builders last year. What’s happened since? Chapter 7 bankruptcy! Plus now, says the Chronicle‘s Nancy Sarnoff:

Wisenbaker Builder Services, Suncoast Post Tension, Builders Mechanical and Luxury Baths by Arrow are collectively seeking to recover more than $1.1 million from the builder, according to the petition filed last month in U.S. Bankruptcy Court for the Southern District of Texas.

Thousands of home- owners could also have claims against the company.

Attorney David Jones, who is representing Royce in the bankruptcy, is compiling names of potential creditors that lists more than 12,000 people.

“Homeowners are the biggest portion,” said Jones, a partner with Porter & Hedges.

Oh, but there’s more! In a separate legal action, an educational charity that Royce owner John Speer used to promote his businesses and solicit contributions from customers is claiming that Royce failed to deliver funds raised on its behalf. A struggling charity that renamed itself the Royce Homes Foundation for Youth in 2003 — after Speer apparently promised to deliver several hundred thousand dollars a year in support — says Royce still owes it about $400K:


03/06/09 3:33pm

COMMENT OF THE DAY: WELCOME TO WESTWOOD GARDENS “The neighbors are starting to join together to remove the graffiti. Not many kids are on the blocks but they do range in age from babies to happy teens. You can see them outside at times with their parents, riding scooters, riding bikes or just playing around. The neighbors even have indoor small pups, not those that you see on the news that maul on people or those that are seen used to fight. They are small well cared for happy dogs. Never without being on a leash when they are outside. A few neighbors have been seen flying small model airplanes. Everyone is friendly. Try it, if you see any one of the neighbors outside just wave and you will get a smile and a wave back. Hopefully one day we see you, if so Welcome to Westwood Gardens where you are Not just a Neighbor, Your Family!” [We Are Family!, commenting on Westwood Gardens Still Life: A Photo Tour of Half-Built Houston Homes]

01/16/09 10:48am

So where are all the half-built homes? That question, asked by a Swamplot reader last week, prompted a slew of comments from other readers eager to identify pockets and neighborhoods in and around Houston where construction has come to a halt because of problems connected to the nationwide housing-market collapse. (As well as a few where construction stopped for reasons of a more local nature.)

Swamplot reader subprimelandguy suggested looking at Northwest Houston:

You need to go to the suburban areas, particularly the non master planned communities between the Beltway and Highway 6 / 1960. The most aggressive one is actually inside the Beltway near West Road and Gessner – a former Royce Homes (go figure) development called Westwood Gardens. It is a bombed out poster child for the subprime fiasco.

Then late yesterday, subprimelandguy sent in photos!


11/10/08 10:41am

Map of Royce Homes Neighborhoods

What’s a failed homebuilder to do when it hurriedly goes belly-up . . . but still has a huge chunk of inventory on hand?

Welcome to the Royce Builders Already-Gone-Out-of-Business Home Sale!

How’s it work? Well, if you’re a lucky real-estate agent, you receive a mysterious message with a couple of attachments listing the more than 300 homes in the Greater Houston area the . . . uh, former company still has available! In 49 different neighborhoods around town! And all at discount prices!

Included with the list: a map of the neighborhoods Royce graced (shown above), demonstrating the company’s vast exurban spread.

Of course, the email message doesn’t come from Royce Builders, because Royce is . . . no longer with us. (And, to judge from the comments coming into Swamplot from recent Royce buyers, employees, and vendors, it is sorely missed!) The list comes instead from an email address on the h-smith.com domain. That hyphen, of course, stands for “ammer.” Didn’t Hammersmith Financial, Royce’s sister mortgage company, also go out of business?

But the property list is so much more fun than a collection of random way-far-out addresses: