Boom in Maryland housing exports

April 16, 1992

These may be rocky times for much of the homebuilding industry. But for those with imagination and aggressiveness, the sky is the limit. Just look at Ryland Group Inc., the Columbia-headquartered residential development company. Its year-old housing export arm is entering the new and tricky -- but potentially lucrative -- real estate market in Russia.

Overseas sales is a new, promising field for Ryland, one of the nation's biggest home builders. A year ago, it formed a subsidiary to handle sales to Israel, where 1,300 homes made of American materials have been erected. The new Russian venture, at least initially, will be small by comparison. The first stage consists of building some 20 model homes on lots north of St. Petersburg.

As another Maryland entrepreneur, Keith Anthony, has realized, Eastern Europe is a largely untapped housing market. Mr. Anthony, an Anne Arundel County builder, has been selling modular home kits to Poland, where they are coveted by the newly affluent because of their American refrigerators, stoves and wall-to-wall carpeting.

Neither the Polish nor the Russian market is an easy one. Both countries are in the midst of awesome economic difficulties that make daily life chaotic. To insulate itself from some of the effects of galloping inflation, Ryland and its Russian partners are insisting that payments for the American houses be made in hard currency.

Despite projected prices in the $100,000-range and above, the Ryland houses are likely to sell like hot cakes to Russian businessmen in joint ventures with Westerners as well as to foreign companies needing housing for their staff. Although a typical house will be small by American standards -- 850 to 1,300 square feet -- they are sumptuous by the Russian yardstick.

If this initial export proves successful, Ryland plans to build its own manufacturing plant in Russia. Such a facility would have a capacity of delivering 500 to 1,000 homes a year, using Russian labor and materials.

Ryland's St. Petersburg venture breaks new ground for Maryland homebuilders. If all the wrinkles can be ironed out, Russia could develop into a market of almost unlimited potential. Not only for prefabricated and modular homes but also for more modest kits of summer cottages, which are in great demand throughout the former Soviet Union.

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