Martha's Open House

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Ever find yourself wanting to live like Martha Stewart? If so, has KB Home (NYSE: KBH) ever got a housing development for you. The real estate developer is teaming up with Martha Stewart Living Omnimedia (NYSE: MSO) to build 650 new single-family homes in Cary, N.C.

The new venture is named KB Home Twin Lakes: Homes Created With Martha Stewart. Whew. That's one wordy marquee. The homes will be reasonably priced, starting out in the low $200,000s.

It's, well, "a good thing" for both companies. Love her or hate her, Martha's widely known for her crafty homestead. Her name is an established brand. Just ask Sears Holdings (Nasdaq: SHLD), Sirius Satellite Radio (Nasdaq: SIRI), Provide Commerce (Nasdaq: PRVD), or any of the other companies that have struck business relationships with her.

For KB Home, it's an opportunity to brand a big-ticket item (the biggest of big-ticket items) at a time when new housing starts are running sluggish despite a healthy backlog of orders from developers like Lennar (NYSE: LEN).

The partnership between Martha and KB Home doesn't appear as if it will end in Cary. No future projects were announced, though it seems that if home hunters take kindly to the first development, more will be on the way. In fact, Martha was quoted in yesterday's press release as saying: "We hope to expand these new home designs across the country in years to come."

Growing the deal beyond Cary is important because, as it stands, it's not going to be a major financial contributor to either company in and of itself. KB Home delivered 31,646 new homes last year. This new venture would make up just 2% of that amount.

For investors who have been cashing out as the ratings for Martha's version of The Apprentice show have been tanking, this move should at least prompt them to reassess the reason they bought shares of the company in the first place. A successful prime-time show would have been a bonus, but the deal with KB Home places Martha more in her own element.

And it's symbolic of how Martha is going to build her company back -- one brick at a time.

Some other places to go next:

• Going house shopping this weekend? Check out our Home Center first.
• Martha Stewart Living Omnimedia shares were recommended in Stock Advisor three years ago, only to be recommended as a sale a few months later after a 55% gain.
• Provide Commerce, the company fueling Martha's Flowers, is an active Rule Breakers newsletter stock pick.

Longtime Fool contributor Rick Munarriz has been living in the same place since 1999 -- but he did refinance twice when borrowing costs got dirt cheap. He does not own shares in any of the companies mentioned in this story. T he Fool has a disclosure policy. He is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early.