The Family Business

25 Apr The Family Business

In business, as in real estate, timing is critical — especially when you mix the two. Derek Nelson was feeling the pressure of timing last summer, when the local Arthur Rutenberg Homes franchise was coming available with the retirement of M. Pete McNabb.

Derek Nelson has purchased the Arthur Rutenberg Homes franchise once owned by his stepfather, Pete McNabb.

In other times, Nelson would have sought a bank’s help in his effort to buy land and build a model. But not last summer, at the bottom of a historic real estate collapse, when buying a home-building business seemed risky.

“I talked to a couple banks and they said they weren’t willing to loan to builders to build models right now,” said Nelson.

But for Nelson and his wife, Patti, the question was clear. He could continue to work for someone else — he had been president of Arthur Rutenberg Homes/M. Pete McNabb since 1997 — or own his own franchise.

For the latter choice, they would have to use their own money. “We had to go all-in,” said Nelson, 44.

“My wife and I did some soul-searching and really decided that’s what we wanted to do: We wanted to own the Arthur Rutenberg franchise for Sarasota-Manatee. I felt we definitely were at the bottom. It afforded me to negotiate better with both Art (Rutenberg) and getting the position in Lakewood Ranch. So Art and I worked out some terms, and with Pete’s blessing, as well, moved forward.”

Proceeding meant proving to ARH that Nelson had the financial wherewithal, and experience, to run a successful franchise, bad market or good. It helped that he had a long track record under the Arthur Rutenberg umbrella.

Still, the whole process “was a little scary,” said Patti Nelson.

“But Derek is a very smart business guy, and I trust him. And you figure, it’s got to turn around some time.”

It has. Arthur Rutenberg Homes/Nelson Homes opened its model, the Cancun, in the Valderrama section of Country Club East in Lakewood Ranch seven weeks ago, and the company has signed contracts for seven new houses and one $400,000 remodeling project, “with three (more) I am expecting to write in the next two weeks,” Nelson said. “And, on top of that, six or seven other customers I am working with.”

Like other builders, he has downsized his model: the Cancun has two bedrooms and two baths, a den and a great room in 1,977 square feet of air-conditioned space. The model, with lot, optional pool/spa and furnishings, is $468,488, but Nelson can build the house for $291,000 — most of his sales have been in excess of $500,000 — on a standard Lakewood Ranch lot. It has a number of green features — it’s certified by FPL BuildSmart and the Florida Green Building Coalition — and upgrades.

But that’s not all there is to Nelson’s story. His purchase of the ARH franchise resulted from more than just being willing to take a chance in a down economy. He had been working toward this role for most of his life.

As an 11-year-old, he woke up at dawn on weekends so he would be ready to go out on job sites with his construction-manager stepfather — none other than Pete McNabb.

“From the time I entered the construction industry, he had an interest in what was happening at my work place,” recalled McNabb. “So much so, that he would set his alarm on Saturdays, get up and make his own breakfast, and be asleep on the stairs, waiting for me to go to work at 6 a.m.”

The youngster’s work included sweeping out unfinished houses, framing and masonry work.

“When Pete did Fairway Woods, I was 15, 16, and worked on the framing crew on the weekends and summers,” said Nelson. “Art Rutenberg used to come down and hover in his helicopter and land there. It was pretty neat stuff. The whole site would just stop.”

Nelson fit this in with playing baseball and football, under legendary coach Jim Powell, at Venice High. During high school, Nelson told McNabb he would like to work for him, but the stepfather insisted on a college education first.

He went on to play freshman football at Georgia Southwestern, but missed Florida and returned home to attend Manatee Community College. Again, he asked McNabb for a job.

“I told him no, that I expected a four-year degree,” said McNabb. “For the next year or so, he worked in the trades as a mason’s helper, a framer’s assistant and finally as a framer.” The hard labor and heat convinced him to go back to college.

“The day that he graduated from UCF in Orlando, his mother and I were there to witness his achievement. He walked up to me and handed me his diploma and said, ‘I’ll see you at work on Monday, but right now I’ve got some serious parties to go to.’ I was very proud that he stuck in there and completed his education, and was now coming to work for me.”

In the meantime, Nelson had learned “all facets” of construction, he said, “so when I got the job as a construction manager, I couldn’t get the wool pulled over my eyes.”

Nelson said he gets the most pleasure not from the contracting, but the contacting.

“There is nothing more fulfilling for me than to take that piece of raw land and to build it, and watch a family grow and prosper there, and be happy,” said Nelson, seated in the living room of his Cancun model.

“That’s why I do it. My first home that I sold, in (the Preserve at) Heron Lake — the family is totally excited, totally happy. They have a 6-year-old daughter who is excited about her new home, and that is huge for me.”

Nelson’s empathy for his home-buying customers might stem from his childhood experiences.

When Nelson was very young, his father was busy working a day job with a railroad while at the same time building a house, largely by himself, for his family in Westchester County, N.Y.

Doug Nelson kept an exhausting schedule. One night, while driving home from the construction site, he fell asleep at the wheel. The fatal accident left Donna Nelson alone with three young children.

At the urging of her parents, who were retiring to Florida, Donna moved to Titusville, on Florida’s east coast, to be near them, and started over. She moved into an apartment with two sons and a daughter.

Next door lived Pete McNabb, who, at 26, was unmarried.

“The boys hung out with me at the pool, stopped by my apartment anytime they felt like it, to say hello and grab a soda out of my fridge,” recalled McNabb. “We had already bonded as friends, buddies, and Little League coach vs. player before I started dating Donna.”

Donna Nelson and Pete McNabb soon wed.

“The next step was easy,” McNabb said. “I never spared the rod to spoil the child. They all three grew up to be model citizens.”

McNabb was up to the challenge of being a father to someone else’s children, and provided for them by building a career with Southeast Bank. He grew especially close to Derek, who was just 14 years younger than him, and coached the youngster’s youth football team.

“We bought a boat,” said Nelson, “and on weekends we were always out on that when we weren’t playing sports.”

In 1976, the bank transferred McNabb to south Sarasota County. But by the end of the decade, after a stint in the financing department of Matthews-Currie Ford in Venice, McNabb had joined U.S. Home as a construction manager. It wasn’t too long before young Derek was joining him in the field.

Later, as the Arthur Rutenberg Homes franchise holder for Manatee and part of Sarasota counties, M. Pete McNabb Inc. became one of the area’s best-known builders, winning many awards.

Patti Nelson knew the home-building game first-hand, too. She had worked for a carpenter, “swinging a hammer,” in her early 20s and later worked for Kimball Hill Homes and Arthur Rutenberg Homes in the purchasing department.

“I’d say I was there (at ARH) a year or so before I met Derek,” she recalled. “He came in and asked me out — it was kind of strange. Just out of the blue. I had only been introduced to him probably two months before that at a franchise meeting, to go over a manual.

“It was April Fool’s Day. He came in and asked me out to dinner, and that was that. We were engaged about three months after that. We both had the same ideas about what we wanted in life: We wanted kids, and we were both 32 and ready to move on, both athletic.”

That was 11 years ago. They are now the parents of Lily, 10, and Cade, 8. Also, Patti has a daughter, Madison, who is now 16.

“Pete did it, I did it,” said Nelson.

Running a franchise and raising a stepchild, that is.

Like stepfather, like son.