Home-Builder Peters to Retire at End of Month : O.C. developer: He delayed exit from high-quality construction firm until new owners could be found.

NEWPORT BEACH — Builder James M. Peters, who helped pioneer mass construction of high-quality, high-cost homes in Southern California, will retire Feb. 28 as president and chief executive of the company he founded nearly two decades ago.

Publicly traded JM Peters Co. will continue operating under the same name, Peters and other officials said Wednesday, and plans to build at least 1,500 homes in the next three to four years.

Many of those homes will be sold well below current market prices because of falling land values and the generous debt-forgiveness deal the Peters company’s new majority owner struck when it acquired 85% interest in the company in August.

Peters described his retirement at age 57 as “a chance to examine where I am in my life and what I want to do with the rest of it.”

He said he has not made any plans for the future and shrugged when asked if he might start a new home-building company. He will remain available as an adviser, he said, for the company he founded in 1975.

Peters, who co-founded his first home-building company in 1968, sold JM Peters Co. to San Jacinto Savings & Loan of Houston in 1985 in a deal that netted him more than $21 million and called for him to head the company for another five years. But when San Jacinto ran into financial troubles and was seized by the government in 1990, just as Peters’ employment contract expired, he agreed to stay on until the federal Resolution Trust Corp. found a buyer--a process that took nearly two years.

After Peters’ retirement at the end of the month, Chairman Hadi Makarechian will take on the additional title and duties of chief executive. Dale Dowers, chief operating officer, will keep that position and assume Peters’ responsibilities as president.

Makarechian and Dowers are partners in Capital Pacific, the privately held Newport Beach company that acquired control of JM Peters Co. in August.

Dowers, who had been president of Costain Homes in Newport Beach before joining forces with Makarechian several years ago, once worked for Peters in a mid-level management position.

Peters’ retirement was announced to the company’s staff of about 50 employees late Wednesday afternoon. At its peak in the late 1980s, the Peters company employed more than 300.

The wiry, soft-spoken builder, whose thick shock of prematurely white hair is set off by a deep tan even in the dead of a rainy winter, said his decision to leave was made years ago but was delayed by the company’s financial turmoil.

“This is as good a time as any to leave,” he said Wednesday in his Newport Beach office. “I stayed during the transition period, and I think a lot has been accomplished, so I am fully comfortable walking out the door now.”

Among those accomplishments, Peters said, has been the development of a new line of home designs. It will continue to use the high-quality touches for which the Peters name has become synonymous while trimming away some of the architectural excesses of the late 1980s building boom that helped boost Southern California housing prices out of the reach of most buyers.

In addition, the company’s debt has been slashed to just $5 million from $145 million--largely because of a nearly $100-million debt forgiveness deal that Capital Pacific negotiated with the RTC when it acquired the majority of JM Peters’ stock from the federal agency last summer.

Peters, Dowers and Makarechian have engineered a restructuring of the company since August that has included closing its San Diego, Ventura and Los Angeles divisions, the sale of more than 300 lots in those three counties and a new focus on homes designed for the price- and value-conscious buyers of the recessionary ‘90s.

As Peters prepares to leave the company, its net worth stands at $50 million, including about $12.5 million cash, Makarechian said.

That cash will help the company acquire more land in Orange, Riverside and San Diego counties in coming months, Dowers said. Though he would not provide particulars, he said that the company has sent letters of intent to purchase to several builders who are offering developed residential lots at steep discounts from the record high prices of the late 1980s.

JM Peters Co.’s new designs will combine with the reduced land values to help keep home prices down, Dowers said. Those new designs will also be featured in four new Orange County projects that just opened for sales or are about to open. The Peters company will be selling luxury homes and townhomes in those projects at prices that begin below $100 a square foot. Comparably sized homes in the same areas now start at $120 to $150 a square foot.

Construction will be financed by CALPERS, the California state employees pension system, which has invested $16.6 million in a series of joint ventures with JM Peters Co. Construction lending could hit $20 million at the peak of building activity in the four Orange County projects, which ultimately will contain more than $100 million worth of new housing, Dowers said.