Late last week, my editorial director and I drove out to Frederick, Md., to visit with Dan Ryan of namesake Dan Ryan Builders. Ryan is one of the builder executives who we're profiling for our annual private builder report, which will be the centerpiece for the May issue of Big Builder.

If you don't know Ryan, the thing to realize about him is that he was born to be a builder. His two brothers, Jim and Pete, are builders. His father, Jim, was a builder; in fact, Jim was the founder of Ryland Homes. Even his two uncles, Bill and Ed, were builders. Building is in his blood.

But that doesn't make it easy.

And no more was that evident than in the first five minutes of our meeting. A giant stuffed bear--reared up on its hind legs, with claws out and teeth bared--occupying a corner of the office set the tone for what turned out to be several hours worth of conversation about the two things most on the minds of every private builder--banks and balance sheets.

But just in case the ferocious bear wasn't daily reminder enough of how savage business is these days, a five-minute voicemail from dear old Dad served up a healthy dose of reality for Ryan. Ryan was kind enough to give us a listen.

What we heard as Ryan turned on the speaker phone and placed his mobile phone on the table in front of us was the sage and concerned voice of someone delivering a lesson in both business and life. Ryan's father counseled him to hold out on the bank's request for a personal guarantee on a loan. "It scares the heck out of me, and I know it does you, too," he said. His message then jumped from finance to operations, as he harped on how Ryan had to work on reducing building days. He reminded Ryan that it was his own key to survival back in his days as a home builder chief executive. And for added good measure, he left a similar message about cycle time on Ryan's CFO's voicemail.

"I know about building days," Ryan said, smiling in a proud and amused way as he hung up the phone. "But there's something about hearing it from someone that passionate. I know I'm going to focus on it more because of that message."  

And Ryan's lucky to have a ready-made mentor in his father; without him and his sagesse, Ryan perhaps wouldn't be in the situation he's in now. Granted, like many of his private builder brethren, he's working hard to keep the bank at bay. But he's also working on setting the company up to emerge from this downturn with more market share.

How is he doing it? Some of it is chance, and some of it is choice. But as the saying goes, "You have to be lucky to be good."

Rewind a few years to when times were better, and Ryan said it was hard to compete with the local divisions of national home builders. They arrived in a market with fistfuls of cash and were able to tie up A-grade land positions. The only thing Ryan had to offer against their cash was a solid reputation in the local community, which only went so far.

But all that has changed as the nationals have shuttered some of their less profitable divisions. Their local roots are going the distance as developers and home buyers in some of the company's markets are finding themselves with fewer builder options.

And so now is the time to be locking up land deals that will see the company through the next handful of years. Ryan told us that he's signed up three new communities in the last 45 days under what he deemed "very favorable terms." In every case, it was land abandoned by a national builder who has pulled out of the market.

But how does he do it when banks have clamped down on acquisition and development funding? It's about people, Ryan said.

"In the relationship game, I'm going to do everything I can to get a win-win," he said.

Ryan told us about how he teamed up with a local developer to get a deal worked out that would help secure the future of both companies. "We gave, they gave. Our margins are minuscule, but you've got to do it, if we want our business to be here in five years," he said.

In another example, Ryan shared with us how he secured a parcel with no deposit and no takedown schedule. He used a model home as his earnest money; it was enough to show the developer he was committed to the community.

I thought this was interesting, as I hadn't heard of any builders to date using this method. Fee building, yes, but not this type of deal. Not that I wasn't expecting to hear about it. Albert Praw, CEO of Landstone Communities, told me roughly two years ago that the industry would be headed in this direction. When he was with KB Home during the early 1990s, which was a super tough time for the company, he had worked out similar deals with developers.

Oh, how things come full circle.

So, while Ryan can count himself one of the lucky ones--not only is he still in business, but he's on pace to close 400 homes this year--every day is a battle with a beast larger than the big bear that lurks in the corner of his office.

"I'll be a happy man when I can put a check mark next to 2009," he said. "Because I know it's going to be hard as hell."

Photo: Courtesy of www.taxidermyplus.com