One on One
March-April, 2007
The Knight Group
The story of The Knight Group is one about a family as much as it is about a homebuilding business. Back in 1978, Brothers Perry and Scott Knight decided to start a sundeck building and home renovation business in an effort to make life better for their financially-struggling family. Today, the family runs a homebuilding business that has built more than 25 neighborhoods and about 5,000 homes. Having won numerous professionalism awards and consistently ranked in the Atlanta Business Chronicle's “Top 25 Atlanta Home Builders,” The Knight Group is currently active in 18 neighborhoods, building single-family detached homes and townhomes all over Georgia, including the 20 South Region counties of Coweta, South Fulton, Newton, Henry, Carroll, and Butts. Sherri Smith Brown recently sat down with second-generation principal Jay Knight at Renaissance, the developer's 1,000-townhome complex in South Fulton County, to learn more about the family's story—and their commitment to bringing quality and value to the first-time home-buying experience.
SSB: The Knight Group is truly a family business. When and how did the business get started?
JK: My dad (Perry) and uncle (Scott) wanted to build sundecks; they had a bunch of cards printed with Knight's Sundecks. People started hiring us to paint their house—this was all around Forest Park —or run aluminum siding. We also started roofing houses. One day we were running aluminum siding on some house in Forest Park and a guy pulled up to the curb and yelled out to us, “Can you guys frame a house?” Well, we were starving to death and just trying to do anything to make ends meet. We'd never seen a house being framed. We'd never been around it. My uncle, who was about 28 years old, looked at that guy and said, “Frame houses? Man, that's all we do.” So, the guy said, “I got one you can start.” We went and it was a big concrete slab and a pile of lumber. What should have taken a couple of days to frame took about three weeks. We went around with a Polaroid camera and took pictures of houses being framed. There wasn't a lot being done back then. We figured out how to frame it. We built this house—it took forever—we didn't make any money. Well, the guy liked us and he gave us another house to frame, and we framed it. A year later, we were doing a house like that everyday.
We lived in what turned out to be government-subsidized apartments in Riverdale, and my Uncle Scott lived in this concrete block utility building. My dad and uncle paid themselves nothing. We continued to live like that with them paying themselves barely enough to get by. See, nobody would give them a construction loan, so they had to keep working and working and framing. We were driving across town to Lawrenceville because Gwinnett County was the only place where anything was going on. In 1980—two years later—they had saved $80,000. We took the money and built a house in Jonesboro. It sat for a long time, but they sold it and back-to-back built two houses in Jonesboro. Sold them and built four more houses. In 1983, we built and sold 35 houses; 1984, 60 houses; 1985 it was around 100 houses. This past year, we sold somewhere near 600 houses. All total, we've sold about 4,000 houses around the area.
SSB: How old were you at that time?
JK: I was 14 or 15. I was out there framing with them during summers and weekends. Around 1982, business got busy enough that my dad began staying on the Southside working on our house building business, while my uncle and I kept running the framing crews. Then in 1983, my uncle got busy enough in our homebuilding business that he stayed here on the Southside and for the next two years, until 1985, I ran the framing crews. And then I became a real estate broker and went into the marketing side of the business.
SSB: You seem to be very hands-on with your business. How do you all divide up the duties?
JK: My father acts as the CFO still. He manages the finances. My cousin, Chris—Scott's son—is actually very detail-oriented and understands systems and procedures really well. He was the first college graduate in the family. He helped incorporate a lot of things like 401K programs for the employees. He manages the insurance programs. So, he's the primary operating officer. My uncle has an incredible knowledge of development and construction. We have great people who run or manage those departments for us, but ultimately, if there are any questions—and there are always questions—Scott can step in, make decisions and give these people a lot of guidance.
SSB: Plus, he's willing to take a risk.
JK: (Laughs) Right, he'll take a risk. Amanda, Scott's daughter recently began working with us after she graduated from college and my grandmother just quit working with us about a year and a half ago. She used to buy all of our water meters and permits and things like that. She's 89 now. (Mildred Knight passed away in early January 2008.) As for me, I just keep my hand on the market, looking for new opportunities. I handle all land acquisitions and zonings and work with Chris on product development. I'm very close to the sales department. Right now, we're trying to be creative and come up with some things to be pro-active in case the slow-down gets to us.
SSB: What's it like to see a family business grow like that?
JK: It's exciting. Now, we're about the 11th largest builder in the city. For a long time, we've been between the 10th and 15th largest builder. That's neat. But when we get around and talk bout the things we enjoy most about it—that story of getting up at 5:30 in the morning and framing those houses and being scared to death and living the way we lived—that's the stuff that's really cool. And we enjoy it. We have distinctly different roles in the company. There's no time when we're crossing one another or second-guessing one another. We all have taken different paths within the business.
SSB: What was the building climate like when you started the business? Did you have any idea that it was going to grow like it grew?
JK: No, we didn't know anything about it. We just wanted to build decks and maybe room additions and home repair. My father says that he had wanted to build houses, but I wasn't aware of that earlier. That was right on the front end of all the growth in Atlanta. Eastern Airlines was about to lay off. We sold a lot of houses in Riverdale and Jonesboro to folks with Eastern, and we thought that would really hurt us and it did a little bit. Back then, the only true production builders were getting started up around Gwinnett County. But on the south side of town, there were not subdivisions. We'd buy scattered lots and infill. It was a completely different thing. It's changed—the last 10 years have been dramatic.
We developed our first community—where we bought the land, built the streets—in 1985. It was called Ashley Estates over in Riverdale. That was the first one where we had a named subdivision and built every house.
SSB: What made you decide to take that step?
JK: We couldn't find lots anywhere. And we had framed for those production builders on the north side of town, so we mirrored some of the best practices we thought they had. It gave us a place to set up a sales model—most communities on the Southside did not have on-site sales presence. It allowed us to control the complete look of the whole neighborhood and establish some standards throughout. That's what everybody is doing now.
SSB: Do you feel like you have established a niche in the market—that you have a certain price range that you feel comfortable with?
JK: We do. We typically build for the entry level in whatever market we're in. In some markets that's $150,000 and others that's $200,000. Whatever markets we're in, we are the best value. We have four principals who are very close to the business, so our quality is outstanding—head and shoulders above anyone at a much higher price. For instance, with the national builders, there is no one who owns those companies actually on site, checking the work. We have an incredible team of people. We are the best value—the most affordable builder—in Atlanta. Year after year, we're in the top 15 largest builders in Metropolitan Atlanta, but we're $30,000 less than the next lowest priced home. That helps us in times like this—and this is a pretty tough market. We're confident that the best price, the best location, and the best product will still sell—and it has—we're still selling houses.
This neighborhood Renaissance where we are sitting is 10 minutes from the airport, 20 minutes from Turner Field, and you can get a house here for under $150,000. There will be 1,000 townhomes here someday, and it has amenities that you won't find in some neighborhoods where houses are a million dollars. Townhomes here have several different floor plans. We're one turn off the interstate. We spend a lot of effort on the land plan. There are linear parks that run through the community, which all townhomes have close access to. There is a zero-entry pool with a huge clubhouse, four lighted tennis courts, a beautiful fountain at the one entrance, and another near the interstate side in our new phase. Most of the townhomes have rear-loading garages off alleyways, so you don't have any problems with cars being everywhere, even on the weekends. We do the exterior maintenance on all the grounds—that's in perpetuity. We paint the buildings whenever they need painting—the homeowner's association pays for that. In addition, we've put trash compactors throughout the community, so there will never be trashcans scattered all around. There are very tight covenants, so the neighborhood, as the landscape matures, should always look better six months out than it does today. Also, one of the linear parks will terminate into a 26-acre commercial area that we are clearing and grading right now. We anticipate neighborhood service/retail.
SSB: What do you think has made Knight Homes so successful?
JK: The fact that we grew up in the craft; that we were hands-on framing contractors. We ran the loaders. We dug the footings by hand. We understand the craft of homebuilding better than anyone I know. I've worked for a lot of builders, as a matter of fact, and they are very good guys. But I think we understand the craft, the process, of building homes better than anyone. I think there are people who may understand marketing and managing finances better than we do—although we've done those pretty well, too. But as far as building homes—we do that better than anyone. We spend a lot of money on our warranty department and have made our service a huge part of our company. To people who are discriminating, who really look close—that shows. We've always tried to offer the best value. The service we offer is the coordination of all subcontractors and all materials, forcing that group of resources to work well, produce this home, and keep it at the very best price. I'm confident that I can build your house cheaper than you can build it yourself. And that's what you pay me for. One part of our mission statement says that we will never lose sight of the honor and responsibility we have to deliver a place that you will call home. And we think that's a big deal. When we went into this business, people were buying homes for $50,000 or $60,000, and they were nice houses. $50,000, $60,000—that's still a lot of money to me. And now a starter home is—our average sales price is $170,000. We meet every week. I see my family virtually every day and we talk about the fact that if somebody is going to give you $170,000 for something, you better make sure it is something good. In our industry, when you talk to people about $170,000 homes, their opinion is that those are not very nice houses. Well, we think that we have an obligation to deliver something great for that price.
SSB: How have your ideas about building homes changed?
JK: I think we're mindful that we do want to be a legacy builder—that we do want to be around for a long, long time. That's kind of neat because up until 15 years ago or so, we just wanted to have a healthy business and be a good homebuilder. Now, we trust the fact that we have a business and that we are a good homebuilder. I think there is an unspoken awareness between us that we want to build things of significance—we want to do things of quality. We're local, we all go to churches in the area, and we shop in the area. Some of my closest friends are people whom I've built homes for. And I like that. I think that says a lot and I want to keep that.
Copyright www.20SouthMagazine.com 2008
March-April, 2007
The Knight Group
The story of The Knight Group is one about a family as much as it is about a homebuilding business. Back in 1978, Brothers Perry and Scott Knight decided to start a sundeck building and home renovation business in an effort to make life better for their financially-struggling family. Today, the family runs a homebuilding business that has built more than 25 neighborhoods and about 5,000 homes. Having won numerous professionalism awards and consistently ranked in the Atlanta Business Chronicle's “Top 25 Atlanta Home Builders,” The Knight Group is currently active in 18 neighborhoods, building single-family detached homes and townhomes all over Georgia, including the 20 South Region counties of Coweta, South Fulton, Newton, Henry, Carroll, and Butts. Sherri Smith Brown recently sat down with second-generation principal Jay Knight at Renaissance, the developer's 1,000-townhome complex in South Fulton County, to learn more about the family's story—and their commitment to bringing quality and value to the first-time home-buying experience.
SSB: The Knight Group is truly a family business. When and how did the business get started?
JK: My dad (Perry) and uncle (Scott) wanted to build sundecks; they had a bunch of cards printed with Knight's Sundecks. People started hiring us to paint their house—this was all around Forest Park —or run aluminum siding. We also started roofing houses. One day we were running aluminum siding on some house in Forest Park and a guy pulled up to the curb and yelled out to us, “Can you guys frame a house?” Well, we were starving to death and just trying to do anything to make ends meet. We'd never seen a house being framed. We'd never been around it. My uncle, who was about 28 years old, looked at that guy and said, “Frame houses? Man, that's all we do.” So, the guy said, “I got one you can start.” We went and it was a big concrete slab and a pile of lumber. What should have taken a couple of days to frame took about three weeks. We went around with a Polaroid camera and took pictures of houses being framed. There wasn't a lot being done back then. We figured out how to frame it. We built this house—it took forever—we didn't make any money. Well, the guy liked us and he gave us another house to frame, and we framed it. A year later, we were doing a house like that everyday.
We lived in what turned out to be government-subsidized apartments in Riverdale, and my Uncle Scott lived in this concrete block utility building. My dad and uncle paid themselves nothing. We continued to live like that with them paying themselves barely enough to get by. See, nobody would give them a construction loan, so they had to keep working and working and framing. We were driving across town to Lawrenceville because Gwinnett County was the only place where anything was going on. In 1980—two years later—they had saved $80,000. We took the money and built a house in Jonesboro. It sat for a long time, but they sold it and back-to-back built two houses in Jonesboro. Sold them and built four more houses. In 1983, we built and sold 35 houses; 1984, 60 houses; 1985 it was around 100 houses. This past year, we sold somewhere near 600 houses. All total, we've sold about 4,000 houses around the area.
SSB: How old were you at that time?
JK: I was 14 or 15. I was out there framing with them during summers and weekends. Around 1982, business got busy enough that my dad began staying on the Southside working on our house building business, while my uncle and I kept running the framing crews. Then in 1983, my uncle got busy enough in our homebuilding business that he stayed here on the Southside and for the next two years, until 1985, I ran the framing crews. And then I became a real estate broker and went into the marketing side of the business.
SSB: You seem to be very hands-on with your business. How do you all divide up the duties?
JK: My father acts as the CFO still. He manages the finances. My cousin, Chris—Scott's son—is actually very detail-oriented and understands systems and procedures really well. He was the first college graduate in the family. He helped incorporate a lot of things like 401K programs for the employees. He manages the insurance programs. So, he's the primary operating officer. My uncle has an incredible knowledge of development and construction. We have great people who run or manage those departments for us, but ultimately, if there are any questions—and there are always questions—Scott can step in, make decisions and give these people a lot of guidance.
SSB: Plus, he's willing to take a risk.
JK: (Laughs) Right, he'll take a risk. Amanda, Scott's daughter recently began working with us after she graduated from college and my grandmother just quit working with us about a year and a half ago. She used to buy all of our water meters and permits and things like that. She's 89 now. (Mildred Knight passed away in early January 2008.) As for me, I just keep my hand on the market, looking for new opportunities. I handle all land acquisitions and zonings and work with Chris on product development. I'm very close to the sales department. Right now, we're trying to be creative and come up with some things to be pro-active in case the slow-down gets to us.
SSB: What's it like to see a family business grow like that?
JK: It's exciting. Now, we're about the 11th largest builder in the city. For a long time, we've been between the 10th and 15th largest builder. That's neat. But when we get around and talk bout the things we enjoy most about it—that story of getting up at 5:30 in the morning and framing those houses and being scared to death and living the way we lived—that's the stuff that's really cool. And we enjoy it. We have distinctly different roles in the company. There's no time when we're crossing one another or second-guessing one another. We all have taken different paths within the business.
SSB: What was the building climate like when you started the business? Did you have any idea that it was going to grow like it grew?
JK: No, we didn't know anything about it. We just wanted to build decks and maybe room additions and home repair. My father says that he had wanted to build houses, but I wasn't aware of that earlier. That was right on the front end of all the growth in Atlanta. Eastern Airlines was about to lay off. We sold a lot of houses in Riverdale and Jonesboro to folks with Eastern, and we thought that would really hurt us and it did a little bit. Back then, the only true production builders were getting started up around Gwinnett County. But on the south side of town, there were not subdivisions. We'd buy scattered lots and infill. It was a completely different thing. It's changed—the last 10 years have been dramatic.
We developed our first community—where we bought the land, built the streets—in 1985. It was called Ashley Estates over in Riverdale. That was the first one where we had a named subdivision and built every house.
SSB: What made you decide to take that step?
JK: We couldn't find lots anywhere. And we had framed for those production builders on the north side of town, so we mirrored some of the best practices we thought they had. It gave us a place to set up a sales model—most communities on the Southside did not have on-site sales presence. It allowed us to control the complete look of the whole neighborhood and establish some standards throughout. That's what everybody is doing now.
SSB: Do you feel like you have established a niche in the market—that you have a certain price range that you feel comfortable with?
JK: We do. We typically build for the entry level in whatever market we're in. In some markets that's $150,000 and others that's $200,000. Whatever markets we're in, we are the best value. We have four principals who are very close to the business, so our quality is outstanding—head and shoulders above anyone at a much higher price. For instance, with the national builders, there is no one who owns those companies actually on site, checking the work. We have an incredible team of people. We are the best value—the most affordable builder—in Atlanta. Year after year, we're in the top 15 largest builders in Metropolitan Atlanta, but we're $30,000 less than the next lowest priced home. That helps us in times like this—and this is a pretty tough market. We're confident that the best price, the best location, and the best product will still sell—and it has—we're still selling houses.
This neighborhood Renaissance where we are sitting is 10 minutes from the airport, 20 minutes from Turner Field, and you can get a house here for under $150,000. There will be 1,000 townhomes here someday, and it has amenities that you won't find in some neighborhoods where houses are a million dollars. Townhomes here have several different floor plans. We're one turn off the interstate. We spend a lot of effort on the land plan. There are linear parks that run through the community, which all townhomes have close access to. There is a zero-entry pool with a huge clubhouse, four lighted tennis courts, a beautiful fountain at the one entrance, and another near the interstate side in our new phase. Most of the townhomes have rear-loading garages off alleyways, so you don't have any problems with cars being everywhere, even on the weekends. We do the exterior maintenance on all the grounds—that's in perpetuity. We paint the buildings whenever they need painting—the homeowner's association pays for that. In addition, we've put trash compactors throughout the community, so there will never be trashcans scattered all around. There are very tight covenants, so the neighborhood, as the landscape matures, should always look better six months out than it does today. Also, one of the linear parks will terminate into a 26-acre commercial area that we are clearing and grading right now. We anticipate neighborhood service/retail.
SSB: What do you think has made Knight Homes so successful?
JK: The fact that we grew up in the craft; that we were hands-on framing contractors. We ran the loaders. We dug the footings by hand. We understand the craft of homebuilding better than anyone I know. I've worked for a lot of builders, as a matter of fact, and they are very good guys. But I think we understand the craft, the process, of building homes better than anyone. I think there are people who may understand marketing and managing finances better than we do—although we've done those pretty well, too. But as far as building homes—we do that better than anyone. We spend a lot of money on our warranty department and have made our service a huge part of our company. To people who are discriminating, who really look close—that shows. We've always tried to offer the best value. The service we offer is the coordination of all subcontractors and all materials, forcing that group of resources to work well, produce this home, and keep it at the very best price. I'm confident that I can build your house cheaper than you can build it yourself. And that's what you pay me for. One part of our mission statement says that we will never lose sight of the honor and responsibility we have to deliver a place that you will call home. And we think that's a big deal. When we went into this business, people were buying homes for $50,000 or $60,000, and they were nice houses. $50,000, $60,000—that's still a lot of money to me. And now a starter home is—our average sales price is $170,000. We meet every week. I see my family virtually every day and we talk about the fact that if somebody is going to give you $170,000 for something, you better make sure it is something good. In our industry, when you talk to people about $170,000 homes, their opinion is that those are not very nice houses. Well, we think that we have an obligation to deliver something great for that price.
SSB: How have your ideas about building homes changed?
JK: I think we're mindful that we do want to be a legacy builder—that we do want to be around for a long, long time. That's kind of neat because up until 15 years ago or so, we just wanted to have a healthy business and be a good homebuilder. Now, we trust the fact that we have a business and that we are a good homebuilder. I think there is an unspoken awareness between us that we want to build things of significance—we want to do things of quality. We're local, we all go to churches in the area, and we shop in the area. Some of my closest friends are people whom I've built homes for. And I like that. I think that says a lot and I want to keep that.
Copyright www.20SouthMagazine.com 2008
