Columbia firm builds business in Israel

RYLAND'S DESERT STORM

July 07, 1991|By Alyssa Gabbay | Alyssa Gabbay,Special to The Sun

JERUSALEM -- The road to the Israeli city of Beersheba is hot and dry. Bedouin tents dot the landscape, their owners clothed in long robes against the sun's rays.

It seems like an unlikely place to find a Ryland home.

Nevertheless, a new subsidiary of the Columbia-based Ryland Group Inc., better known for its suburban tract houses, is leaving its mark on the Negev desert.

So far, the 4-month-old subsidiary, Ryland Trading Ltd., has shipped millions of dollars worth of materials that the Israelis are using to construct several hundred homes in the Negev city of Ofakim, about 15 miles from Beersheba. And now, Ryland Trading is negotiating a contract with two Israeli building companies to export materials for about 200 prefabricated duplex homes, according to Eli Alter, an Israeli builder who is overseeing much of the project.

The homes will be built to house Soviet Jewish immigrants in Nachal Ashan (Smoke River), a new neighborhood of Beersheba, a city of 110,000. Ryland has signed a tentative agreement for the project, and Mr. Alter hopes to see construction completed by November.

With about 200,000 Soviet Jewish immigrants arriving in Israel last year, and a similar number expected this year, the Jewish state is scrambling to provide housing for its new citizens. Amnon Neubach, minister of economic affairs at the Israeli Embassy in Washington, said that the Israeli government hopes to build as many as 120,000 new homes this year -- a sharp increase from the 18,000 to 22,000 constructed in recent years.

U.S. manufacturers and homebuilders like Ryland, many of whom are suffering from the U.S. housing recession, have rushed to fill the demand. Almost one-fifth of U.S. panelized home producers expect to export materials to Israel this year, according to the February issue of Automated Builder. Israeli companies generally provide labor, utilities and foundations for the houses, while the Israeli Housing Ministry buys the completed homes from the builders and rents or sells them to new immigrants, Mr. Neubach said.

Two other Maryland companies want to help provide housing for immigrants. SACO Supply, a Timonium-based manufacturer of prefabricated homes, is negotiating with Israel Housing Investors Inc., a Rockville-based developer, to ship several hundred homes to Israel. Israelis involved in the venture would build and sell the homes to new immigrants.

The Ryland Group became involved in the venture last year when it was contacted by Sharbiv Ltd. of Haifa about providing materials for several hundred homes, said Vaike Talts, public relations coordinator for Ryland.

This February, Ryland, which previously had confined its activities to the U.S. market, created Ryland Trading to specialize in overseas activity. Shortly thereafter, the new company began shipping wall panels, floor joists and roof trusses tothe Israeli contractors from its plant in Fredericksburg, Va.

"Needless to say, a mass migration provides a need for immediate housing," said Thurman Bretz, president of Ryland Trading. "We're just trying to respond to that need." He declined to reveal sales figures for the Ofakim project.

Last October, Ryland Trading Ltd. embarked on its second Israeli venture when it began negotiating with Tishbahot Co. Ltd. and Canisra Group Ltd. about supplying materials for the Beersheba homes.

The homes for both projects are wood, one-story duplex units, Mr. Bretz said. Each 660-square-foot unit contains two bedrooms, one bathroom and a small kitchen.

"These are very small, simple, plain houses," said Mr. Bretz, who said the homes must conform to Israeli Housing Ministry regulations.

The Housing Ministry restricts the size of the houses in order to build them as cheaply and quickly as possible, according to Mr. Neubach.

The Israeli housing crisis is creating cramped living conditions for many Soviet immigrants. It is not unusual for two or more immigrant families to share one apartment, according to Enid Wurtman of the Public Council for Soviet Jewry. The council is an Israeli organization that works to help absorb Soviet immigrants into Israeli society.

"In many cases, multigenerational housing is happening, or families who are friends or strangers are living together," Ms. Wurtman said.

The Israeli government also has resorted to housing Soviet immigrants in hotels, where one family might live in a single room.

Ryland's move onto the world stage reflects the international orientation of the company's new chief executive officer, Roger Schipke, who was involved in overseas ventures when he was senior vice president of General Electric Appliances, Mr. Bretz .. said. Mr. Schipke became Ryland CEO in December.

At present, Mr. Bretz said, Ryland Trading's business makes up a "very modest" portion of the company's revenues, which reached $1.33 billion last year. He added that Ryland hopes to make international ventures a much bigger component of its business in coming years.

Although Israel seems to hold many prospects for business, Mr. Bretz said that he also is targeting other countries. Ryland has met with building contractors in Poland, Spain, Mexico and the Soviet Union about exporting housing materials.

"I think we recognize that there's an opportunity for homebuilding possibly worldwide," Mr. Bretz said.

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