For Woodside’s New CEO, Joel Shine, the Job is Simple to Say, Hard to Do
As he puts it, Joel Shine has two jobs. One is to generate as much net cash return as possible for newco Woodside Homes’ justifiably high-maintenance, anxiety-prone creditor-owners as possible–starting yesterday.
The other is to instill his recently sucker-punched operational team of business unit leaders and associates as well as Woodside’s puzzled base of customers with pride, motivation, confidence and trust.
“It’s simple,” Shine says. In that easier-said-than-done way, it is simple. It’s the same two jobs home building company CEOs and presidents have everywhere, irrespective of their capital structure or submarket network. The difference between simple and easy is glaring. Simple to say, hard to do.
Collectively, several insurance companies and a 15-memeber lender syndicate had lost patience with Woodside in late 2008, and pressed to recover $800 million in monies they regarded as their stake. Shine worked with them toward one end: take stock of what you’ve got, put it to work, and get back as much of your money as you can.
Getting dozens of creditors to agree to take a haircut is no mean feat, but it may have been the easy part. Now comes dealing with an obstinate, inhospitable home buying and selling marketplace, with more pain to come.
This is what Joel Shine signed up for. “I like a good challenge. I bore quickly. Probably, like many of my more successful friends, if they had such a diagnosis back in my day, I’d have been diagnosed as A-D-D.”
Associative disorders and compulsive attention to detail do not apparently, however, rule one another out. What associative disorders likely do help is the ability to multi-task like there’s no get out, and to see problems and solutions from a prism of perspectives. Which describes Shine’s chameleon capacity to tune in, focus, address, and move on amid converging urgencies.
This is interesting because Shine, the son of a home builder who’s the son of a home builder, is fascinated with convergence and time. So much so that, although he’s a voracious reader, one of his memorable favorites is Robert Grudin’s “Time and the Art of Living.”
Here’s a quote from that:
“The future is like a friendly stranger, polite and patient, forever trying to get acquainted with us, forever being rebuffed.”
Time and timelines go with risk and reward. One of Shine’s life’s passions–apart from his family and winning in business–is skiing. One year at the end of January he dared the daunting Streif downhill course at Kitzbuhel (Austria), where the course was iced up nicely for the annual Hahnenkamm race takes place each year.
“That was the scariest ride ever,” says Shine. “I dug my edges in to try to slow my speed, but I couldn’t cut into it, it was so icy.” In contrast, he’s helicopter-skiied in Canada in waist-high dry powder so preternaturally pure that after the third turn, it felt like floating. “It’s the closest I’ve ever felt, not only to weightlessness, but timelessness.”
Home building, Shine says, “is the battle of the timeline.” As a kid on a job site, his father would give him something to do and give him time to figure it out. “I liked learning that way,” and evidently, he still does.
Home building’s timelines are full of risk. “You get all excited about a piece of dirt and you go after it because you have the right product for it, but if it takes any time at all to entitle and develop, you might be into a different market by the time you’re ready to open there.”
Any home builder must recognize who it is and what it does based on its capacity to thrive with two distinct timelines, Shine asserts.
“If you’re in the land business, your timelines are going to run you in to no-trade cycles, and you need a different, much more accommodating capital stack and hold most of the equity and no debt,” Shine says. “If you’re a merchant builder, you’re managing short-term debt and short-term return expectations, and shorter horizons.”