In 1959, Kevork Hovnanian, an ethnic Armenian originally from Iraq, and his three brothers – Hirair Hovnanian, Jirair Hovnanian and Vahak Hovananian – each contributed $1,000 dollars, in addition to $20,000 which they borrowed, to found Hovnanian Enterprises, Inc. in a trailer in Toms River, New Jersey.^[6]

Hovnanian and his company earned a reputation to selling low cost condos and townhouses, many to first time young homeowners and families.^[6] A typical two-bedroom, two bathroom Hovnanian home built in the early 1980s cost approximately $30,000 because Hovnanian eliminated amenities such as communal swimming pools, which other builders used to attract potential buyers.^[6] In a New York Times interview in 1983, Hovnanian explained his reasoning for marketing low cost homes in developments without community amenities, “There are limited recreation facilities going in because people have little time for socialization.”^[6]

In 1964 Jirair Hovnanian split off from his brothers’ company and founded his own construction business, J.S. Hovnanian & Sons, of Mount Laurel Township, New Jersey.^[7] Hirair and Vahak also left the company by 1969 to found their own enterprises.^[6]

Hovnanian Enterprises had built and sold more than 30,000 homes and condos by 1989.^[6] An additional 200,000 residences were sold between 1989 and 2009, as the company expanded its construction to include luxury homes, mid-priced homes and retirement communities.^[6] It remains one the United States’ largest builders of “active adult homes”, which are sold under the name of Four Seasons communities.^[4]

Kevork Hovnanian stepped down as president of Hovnanian Enterprises in 1989, and was succeeded by his son, Ara K. Hovnanian.^[6] He remained chief executive until his retirement in 1997, and was also replaced as CEO by Ara Hovnanian.^[6] However, he remained the chairman of the company’s board of directors until his death in 2009.^[6]

Ara Hovnanian is a graduate of The University of Pennsylvania Wharton School and led the company through 19 acquisitions of smaller builders from 1999 through the early stages of the housing crisis. The company relied heavily on debt to fund the acquisitions. However, falling property prices has forced the company to write off more than $2.6 billion of its value since 2006. As of October 2018, the company’s debt load is $1.5 billion and interest payments amount to about $40 million per quarter.