tim busse - the new town story

The New Town Story: From CSD to New Urbanism -

A Case Study

Tim Busse, AIA, CNUTown Architect, The New Town at St. Charles

Innovative Practices in DevelopmentPresented by the Seaside Institute and Whittaker Builders

Thursday, August 14th, 2008 10:15 am –

11:00 am

Question:When built per CNU charter principles and priced competitively in the local market, is New Urbanism a viable alternative to developing conventional suburban communities?

Whittaker Builders, Inc.

a family-owned, Missouri-based builder/developer

over 30 years of experience building thousands of typical suburban homes

in dozens of communities

throughout the St. Louis region

Greg Whittaker Company President & Town Founder

a second generation land developer/home builder

graduated from the University of Kansas School of Architecture

President of Whittaker Homes for over fourteen years

Greg and his family have been visiting Seaside on summer vacations for close to 20 years. Greg liked that after a 12 hour drive from St. Louis to Seaside, he could park and not need to drive anywhere for the rest of the stay

Tim Busse, AIA, CNU Vice President/Director of Architecture

an architect licensed in California & Missouri, interested in affordable housing and creating places, wearing many hats:

Vice President/Director of Architecture – company spokesman, founder of the WBI Architectural Design Studio

New Town at St. Charles Town Architect

working for the New Town at St. Charles General Assembly (homeowners association) –

community encourager & psychotherapist

Charrette/Workshop coordinator

New Town in a Box marketing team

a complete package of successful, market-proven information and materials

The Cast Iron Company marketing team –

national distributor for a complete line street furnishings used at NTSC

Whittaker Builders, Inc. Business Model•

Whittaker Builders is historically the St. Louis region’s value priced leader, typically selling homes for more than $10k below competitors by purchasing

land carefully, keeping overhead low, and controlling labor costs. Whittaker Builders were already successful at building affordable homes in large suburban tracts, having recently completed a 1,400 home and an 1,800 home subdivision

Whittaker Builders

has its own union field labor, and continue to build both conventional and New Urban communities

Most New Urbanist

developments separate land development from home building. One company develops the lots and small builders build one-off custom homes. Whittaker Homes takes on both roles to allow faster land development & sales velocities

How did Whittaker Builders, Inc. make the transition?

•New Town was envisioned as a compliment to the beautiful, historic City of St. Charles, a largely intact 19th

century river town 2.5 miles south of New Town•The Town Planning firm of Duany, Plater-Zyberk

Company was hired in December 2002 to create a town plan and an alternative zoning code

The Charrette

Duany, Plater-Zyberk

& Company

Town Planner

What changes did Whittaker Builders, Inc. need to make to develop the New Town at

St. Charles?

• There was a complete review of business & construction practices• Only about 30% able to be used for building New Town• Coordination with engineering companies and utility companies was time consuming, but crucial• No existing floor plans were able to be reused for New Town, creating a large backlog of architectural work

Timing is everything!

Timeline

TimelineJanuary 2003

Largest proposed residential development in St. Louis history makes front page news

Largest proposed residential development in St. Louis history makes front page newsFebruary 2003 The New Town at St. Charles Town Planning Charrette

completed

completedMarch 2003

DPZ delivers final town plan & zoning code

completedMarch 2003

DPZ delivers final town plan & zoning codeJuly 2003

Project entitlements completed with virtually no opposition due to Charrette

process

September 2004

New Town from the Air

completedMarch 2003

processDecember 2003

Sales of homes in New Town begin; 65 cottages sell in 2.1/2 weeks

completedMarch 2003

process December 2003

Sales of homes in New Town begin; 65 cottages sell in 2.1/2 weeksApril 2004

414 residential (single family, cottage & row home) units are sold (two years of production backlog sold in four months!), sales are artificially

slowed to guard against future material & labor increases

February 2005

completedMarch 2003

April 2005

First residents move in

May 2005

completedMarch 2003

April 2005

First residents move inJune 2005

Model homes open, sales center relocated to model home garage

August 2005

completedMarch 2003

April 2005

Model homes open, sales center relocated to model home garage Fall 2005

first incentives offered on Apartment Mansion units

completedMarch 2003

April 2005

first incentives offered on Apartment Mansion unitsOctober 2005

Toll Brothers hints at slow down, observed in St. Charles conventional developments sales office traffic counts

March 2006

completedMarch 2003

April 2005

April 2006

corner store opens, 350 residential units closed

completedMarch 2003

April 2005

April 2006

corner store opens, 350 residential units closedMid 2006

New Town customers still had to wait 18 months from contract to move-in

September 2006

completedMarch 2003

April 2005

April 2006

New Town customers still had to wait 18 months from contract to move-inEnd of 2006

slow down worsened, Sales Center next to Marsala’s

Market opens

completedMarch 2003

April 2005

April 2006

Market opensApril 2007

700 total residential units sold

July 2007

November 2007

completedMarch 2003

April 2005

April 2006

700 total residential units soldWinter 2007

Whittaker halfway through backlog; Slow down at New Town observed by fewer cancelations

when compared to convention suburban development

completedMarch 2003

April 2005

April 2006

when compared to convention suburban developmentSummer 2007

sales incentives introduced ($5,000 in free groceries at Marsala’s Market)

completedMarch 2003

April 2005

April 2006

sales incentives introduced ($5,000 in free groceries at Marsala’s Market)2008 projected to close 100-150 units

completedMarch 2003

April 2005

April 2006

sales incentives introduced ($5,000 in free groceries at Marsala’s Market)2008 projected to close 100-150 unitsApril 2008

New Town in a Box is launched at CNU XVI

June 2008

Comparison to our Conventional Suburban Product•

Conventional suburban development in St. Louis averages 2.5 units/acre, New Town is averaging 7-9 units per acre -

three times

the density translates into much lower lot costs, even when factoring in higher (about 20%) infrastructure costs

Favorable press coverage and a busy event schedule generate 5-10 times the sales office traffic, multiple sales office locations to find the sweet spot (next to corner store or café)

New Town regular price increases & overall quality of life gives

reason to buy, even in a bad market

Architectural Guides

A Book of Inspiration

by Steve Mouzonformerly of Placemakers

The Bible

Whittaker Architectural Design Studio

Grading began in Fall 2008

Home Sales began December 26th, 2003 from this temporary sales center -

New Town was marketed as a continuation of the regional urban fabric

Iconic Local Buildings

On-site barn to be rehabbed for Organic Farm

Recreated Train Station

for Sales Center

Prototype Sales Cottage Detailing

Temporary (Movable) Buildings

Initial Cottages had Different Garage Configurations

Materials, Colors & Detailing

Special Details

Unit Type DistributionPhase One -

Variety of dwelling units

Provide authentic choice to residents

Townhouses (14’

wide) to Estate lots (+85’

wide); includes: cottages, bungalows, side yards, live-works, apartment buildings, etc

Building types of similar size face each other across the street

Small mixed-use or commercial types are seamlessly integrated with housing

Smaller lots towards the neighborhood center and larger lots towards the edge

Majority of homes are accessed by a rear lane

Greens and open space are clearly defined and useable

LIVE/ WORK UNITS1,800-

4,000 SQUARE FEET

CONDO/ APARTMENT

HOUSES750-

1,300 SQUARE FEET

ROW HOUSES900-

2,000 SQUARE FEET

COTTAGES1,000-

2,000 SQUARE FEET

SINGLE FAMILY HOMES

1,200-

4,000 SQUARE FEET

CUSTOM HOMES2,000-

5,000 SQUARE FEET

RETAIL/ BUSINESS

CIVIC SPACES/PARKS

Neighborhood Center Civic, Commercial & Live/Work Buildings

Attached RowhomesAverage sales price of $190-200,000

Cottages & Cottage CourtsAverage sales price of $220,000

Apartment Mansions

Senior Courtyard Homes

Average sales price of $140,000

Average sales price of $130,000

Single-Family HomesAverage sales price of $300-325,000House construction costs are about $10/SF more than conventional

suburban development due to better materials and detailing

Lot Cost Statistics

Raw land cost $40-42,000/acre

Raw land average $5,000/lot

Development costs $25,000/lot

Average developed lot cost

$30,000 (excludes carry costs)

Amenity Cost Statistics

New Town Amenities (playgrounds, parks, amphitheater, etc.) cost $3-4,000 per average sized lot ($5-8,000 if you include street trees, sidewalks, lake edging, bollards, etc not found in conventional suburban development).

Responses to Downturn•Cut back field employees•Recommitted to reducing waste & overhead•Revised lots away from hard-to-sell row home product•Refocused on civic projects•Began growing our own food

Multiple Product Lines priced from $110,000 to

$225,000 were Developed

Apartments (535-1070 sf) -

mostly flats, as New Town Apartment leasing at 98%

Condominiums (640-904 sf) -

all flats, two story building, lot costs based of lineal feet of lot, frontage 8.5’

per unit = $10,000 lot cost/unit, 45-

50 units/acre

Duplexes (576-840 sf) targeted for downsizing seniors

Traditional Neighborhood Series (1268-2772 sf) -

single family product on small lots, second floor built over the garage

Apartments 535-1070 sf

mostly flats, as New Town Apartment leasing at 98%

Condominiums 640-904 sf

all flats, two story buildings, lot costs based of lineal feet of lot, frontage 8.5’

per unit =

$10,000 lot cost/unit, 45-50 units/acre

Duplexes 576-840 sf

targeted for downsizing seniors

Traditional Neighborhood Series 1268-2779 sf

Value-engineered box-over-box construction on 70’

deep lots

Traditional Neighborhood Series 1268-2779 sf

Value-engineered, box on box construction on 70’

deep lots

There is still no direct competition for New Town, we expected a competitor to copy New Town within 30 months, but 66 months later still no direct competition

Phase One 90% completed, now building in Phase Two and Three, selling in Phase Ten

As of Today…

Lessons Learned•

New Urbanism is about creating

a variety of great places for residents & visitors, it is NOT about the houses or individual buildings

The single most important sales concept is momentum, as if it is lost, it can not be fully regained

Building the New Urbanism is more complex when compared to conventional development

Coordination

with engineering companies, utility companies, subcontractors, as well as landscape & fencing companies is critical

A wide variety of housing types created especially for New Town created a large backlog of architectural work and large architectural fees, as no existing floor plans were able to be reused

Advice to Developers •

It is a great time to start a construction company, or begin new projects (lower land prices)

Larger projects can start sales at or below cost to `seed’

the community and build momentum, our previous project help support this pricing

Build small & rental units early, to demonstrate the quality to ease the concerns of higher end buyers

Build neighborhood block by block, so complete neighborhood with multiple building types are shown

The trend should reverse eventually due to pent-up demand, if credit market survives,

Under-promise, over deliver –

customers were amazed by the quality of the buildings and the community at closing

Good things about developing the New Urbanism •

Able to differentiate

in crowded markets

Mostly positive (and free) press response

Wide variety of products/types capture almost every market segment

Ability to change product mix to respond to changing markets

Higher profit margins on residential products

Underserved market can create high demand

Much higher sales center traffic

Larger initial outlay, long term profitability (not get-rich-quick)

Whittaker is now sought out by municipalities

Multiple profit centers

Psychic rewards for doing the right thing

The New Town Story: From CSD to New Urbanism - A Case Study

SO WHAT IS NEW TOWN IN A BOX?

NEW TOWN IN A BOXIS

DESIGN INTELLIGENCEFOR

LARGE & SMALLTRADITIONAL

NEIGHBORHOOD DEVELOPERS

THE NEW TOWN AT ST. CHARLES

ONE OF THE FASTEST SELLING &

AFFORDABLETRADITIONAL

NEIGHBORHOODS IN THE UNITED STATES

PEOPLE FROM

AROUND THE WORLDCOME TO NEW TOWN TO

UNDERSTAND HOW THE DEVELOPERS BUILT THE

COMMUNITYFROM THE GROUND UP IN 60 MONTHS

NEW TOWN IN A BOXALLOWS YOU ACCESS

TO MATERIALS COSTING OVER

$1,000,000,ALL USED TO CREATE THE NEW

TOWN AT ST. CHARLES, INCLUDING…

ALL THE

LEGAL INFRASTRUCTURE NECESSARY TO CREATE A

LIVELY NEIGHBORHOOD

CENTER

THE COPYRIGHTS TO THE BEST SELLING PLANS, COMPLETE WITH CORRESPONDING

MARKETING MATERIALS, CONSTRUCTION DRAWINGS,

MATERIAL TAKEOFFS AND CONSTRUCTION BUDGETS

COMMUNITY

MARKETING MATERIALS INCLUDING THE NEW TOWN DVD & PHOTO BANK,

PRESS RELEASES AND GRAND OPENING SCHEDULES, GENERAL ADVERTISING INCLUDING

PRINT ADVERTISEMENTS, BILLBOARD LAYOUTS,

RADIO ADS

AS WELL AS

INSTRUCTIONS

FOR SETTING UP A COMMUNITY NEWSPAPER

…AND EVENT

PLANNING,

INCLUDING A YEAR-LONG

SCHEDULE, MAJOR EVENT

PREPARATION LIST & EVENT MARKETING SAMPLES

along with Complete

Supplier Lists for

Products & Services

In short, you receive everything you need to know to build your project

using Proven Materials & Methods used to Create the New Town at St. Charles…at a fraction of the cost

tim busse - the new town story

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