Spirit Homes Spreading Its Wings

by Kris Hunter  on Monday, Apr. 4, 1994 12:00 am  

Spirit Homes Inc. of Conway is on the high road to expansion.

Arkansas' only mobile-home manufacturer recently added 120 new employees and invested more than $400,000 in capital improvements to prepare for its newest product line: the 18-foot-wide manufactured home.

When the General Assembly in its last session amended transportation laws to allow the transport of 18-foot-wide homes, it opened a road that Spirit Homes previously couldn't travel. Unlike Texas and Louisiana, Arkansas law did not allow the movement of these models until the amendment.

Serving a seven-state area, Spirit Homes now can meet a demand that company Chairman John Allison says was going unfulfilled.

"We had requests for them all the time and couldn't build them," Allison says. "It was like having a toolbox with one tool missing. Now that we've got this tool for our product line, we can get to work."

Spirit Homes sells nearly 2,000 homes a year, which company President Mil Adams says "makes us a medium-sized" operation. Some might put the mobile-home builder on a larger scale — 1993 sales exceeded $30 million.

These are good times for his company, Adams says. During much of the 1980s, many of the South's mobile-home manufacturers were on the verge of extinction. Adams says that at that time the industry was very dependent upon the oil business.

"When oil went next to nothing, this industry took a real hammering," he says. "Dealers went out of business, factories closed and literally thousands of mobile homes went into default."

In the '80s, Texas had 85 facilities that made manufactured homes; today there are only six. Arkansas had about 10 mobile-home manufacturers at one point, but today Spirit Homes is the only one remaining.

"This industry sure has its share of valleys and peaks," Adams says. "But now we can say we are on a peak."

With most of the leftover homes now sold, production is up again. The success that Spirit Homes is enjoying now, Adams says, is partially due to those homes finally leaving the market.

"New construction just went through the floor during those times," Adams says. "Those were difficult years for the industry. It's just begun to get on its feet within the last three years."

Adams says he wouldn't be surprised if mobile-home manufacturers started to surface again. With the market on an upward curve, he says, it would be a good business venture.

"I don't think the worst impact of the whole oil crash was necessarily felt in Arkansas," he says. "So, with our market still being pretty stable, it's possible that more manufacturers will start to come out again."

Open to Expansions

Though transport of the 18-foot-wide homes is restricted to certain state highways, this will enable Spirit Homes to sell to neighboring states, where demand is greatest.

Allison says the company this year will make about $2 million worth, or about 35, of the 18-foot-wide homes. Production won't start until this summer, but internal improvements are under way in preparation for the new product.

"The consumers are going to benefit tremendously from this new house, because all we are doing is adding lumber," he says. "They will get more square feet for a cheaper price."

Spirit Homes has a little more than 300 employees between both Conway locations. Its main facility is a 90,000-SF plant, and the second is about 35,000 SF. The company also makes 14-, 16- and 28-foot-wide homes, the latter being two 14 wides put together.

The manufacturer daily makes about 10 floors, or foundations. The size of the homes range from 728-2,150 SF. Adams says most of the homes sell on the market for about $20 per SF.

Spirit Homes is a wholesaler, able only to sell to licensed dealers. Adams says that with more and more banks financing mobile homes, the company often receives calls from the general public inquiring about having a home built. But "they have to go through the dealer," he says.

As for more expansion plans, Allison says his company is "open" to buying a new building for an additional factory.

"We have looked at some of the neighboring communities near Conway,' he says, "but we haven't set down any plans just yet."



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