The nation’s most prolific pool remodeling firm has purchased a venerable Northern California builder.
Adams Pool Solutions of Pleasanton, Calif., officially acquired San Jose-based Royal Pools of Santa Clara on Jan. 1, confirmed Tony Adams, owner of Adams Pool Solutions.
The move significantly boosts Adams’ new-construction portfolio, and comes in response to the influx of design-and-build firms entering the renovation market, Adams said.
“Our new construction had dwindled in recent years, and this fit into our business plan,” he added. “Royal Pools has been here for 40 years, and they have a fantastic reputation.”
Bill Shepherd Jr., who has been Royal Pools’ president and owner since 1991, will remain with the company as a close consultant, assuming design, construction and “lead estimator” duties. Shepherd’s father founded Royal in 1969.
“Bill’s input will be huge, especially this first year,” Adams said. “We’re both very excited, as this will help expand Royal’s territory.”
In addition to opening up a new-pool market for Adams, the deal also creates one of the largest pool construction and remodel companies in the United States.
In addition, the Royal acquisition made sense for another reason: Shepherd and Adams — contemporaries in age — practically grew up together. Adams’ father started Earl Adams Tile and Coping in the late 1950s, and forged a business relationship with Bill Shepherd Sr. the following decade.
“Tony’s dad was one of my dad’s first subcontractors,” Shepherd said. “Tony’s been our tile and coping guy for as long as I can remember.”
In recent years, Shepherd had been considering slowing down or selling the business, he said. So when he and Adams discussed the prospect over lunch a few months back, the deal just fell into place.
With total residential construction revenues topping $21 million in 2009 ($18 million of that being renovation), Adams ranked No. 9 among Pool & Spa News’ list of Top Builders for 2010. The firm serves multiple markets in Northern California, Nevada and Texas, and in the past few years has launched operations in Mexico and Guam. It remodels approximately 10,000 pools each year.
Royal Pools typically builds around 150 new pools annually, though in recent years that number had fallen by about half, Shepherd said. Still, the firm enjoys a stellar reputation, earning Diamond Certified status from the American Ratings Corp., a regional evaluation service based on customer satisfaction.
Though reports vary, experts estimate Northern California’s new-construction market remains about 60 percent below the boom years of 2005-06. And in the first half of 2010, the Golden State as a whole saw a 13 percent dip in sales from the same period a year earlier.
“It’s still a very soft market, to say the least,” said Raymond Whitford, president of Lifetime Pools, a Pool & Spa News Top Builder in nearby Palo Alto, Calif. “It’s a struggle. There’s still cash in the Bay area, but people remain apprehensive about loosening up the purse strings. Still, I’m guardedly optimistic that 2011 will be an improvement over the previous two years.”