Goodbye Future Levitttowns? Not So Fast.

One of the great American innovators in homebuilding is and was Levitt & Sons, now bankrupt. The bankruptcy left many homeowners in the lurch. Like all residential builders, the company has had trouble in the recent real estate bubble.

The question. Is there value still in the brand? Yes, of course there is. But it might take some time, as it takes time for the troubles to sort themselves out. But creditors should know that there is some value to the brand.

The company was founded in 1929. In 1947, founder William Levitt built iconic Levittown, and later built thousands of houses across the United States under the Levitt brand. In the process, Levitt became synonymous with modestly priced tract houses as G.I.s came home from World War II and bought houses with V.A. loans. We think that is what the Levitt brand is all about. And after the bankruptcy sorts itself out, receivers should investigate how they can extract value from the brand even though Levitt has been tarnished, and all sorts of angry websites have sprouted up with complaining homeowners. The reality? Folks forget the bad things in a few years; what is left behind is an iconic name that needs to be protected through the time of receivership.

The company’s parent, formerly Levitt Corp., this week renamed itself Woodbridge, ticker NYSE: WDG. It owns some nice and gorgeous real estate, including subsidiary Core Communities’ Tradition in St. Lucie, Florida. That will continue on just fine, it seems.

In a company press release from May 1, 2008, Chairman and CEO Alan Levan described how the bankrupt Levitt was split off. Here’s how Levitt disappeared:

“Levitt Corporation deconsolidated Levitt and Sons as of November 9, 2007, eliminating all future operations of Levitt and Sons from the financial results of Levitt Corporation. The Company records any remaining investment in Levitt and Sons, net of any outstanding advances due from Levitt and Sons, as a cost method investment. Under cost method accounting, income will only be recognized to the extent of cash received in the future or when the Levitt and Sons’ bankruptcy is concluded, at which time, any loss in excess of the investment in Levitt and Sons can be recognized into income.”


  • Garland Pollard

    J. Garland Pollard IV is editor/publisher of BrandlandUSA. Since 2006, the website has chronicled the history and business of America’s great brands.

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