HomeVestors of America Inc., the real estate investment company behind the "We Buy Ugly Houses" billboards, today announced that Franchise Brands LLC has acquired a majority interest in the company.
Founded in 1989, HomeVestors sold its first franchise in 1996 and has a network of about 230 franchise offices in 35 states.
The company, which seeks to buy houses and resell them to investors and other buyers for a profit, has bought about 35,000 homes since its launch.
Franchise Brands was created in 2005 with support from the founders of Subway restaurants. That company owns Bajio Mexican Grill, a Mexican gourmet restaurant chain based in Utah; and Mama DeLuca’s Pizza, a quick-serve pizza restaurant chain based in Indiana.
"Franchise Brands was founded on a basic principle: to invest in small and mid-market companies that demonstrate the potential for franchising," according to the company’s Web site.
While Doctor’s Associates Inc., the franchise company for the Subway sandwich chain, does provide support for Franchise Brands, the companies operate separately.
Terms of the deal were not disclosed.
HomeVestors bought 6,400 homes and sold 5,000 last year, and the company bought about 7,100 properties in 2006.
John Hayes, HomeVestors president and CEO, told Inman News earlier this year that the company’s franchise offices haven’t had any problem buying houses for a good price in this housing market downturn. "There are more houses to buy than we can possibly buy at great, fantastic prices. The question is: What are we going to do with them?"
In a statement about the acquisition, Hayes said, "The past 12 months have proven to be challenging for most real estate-related businesses, including HomeVestors, but when the real estate market completes its correction and begins to expand again, HomeVestors will be … situated to continue expanding, too."
He also stated that no changes are expected in the management team for HomeVestors. Hayes has served as president since late 2004 and CEO and chairman since January 2005.
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