Building neighborhoods for a broad market

Editor’s note: this is the first of a two part series on how to keep costs down when building a new urbanist project. The first article covers home construction issues. The next will focus on density and infrastructure. Most of the early, successful TNDs have been like European sports sedans — hand crafted, beautiful and expensive. Projects like Seaside, Kentlands, Harbor Town, Windsor, Newpoint and Celebration demonstrate the quality architecture, walkability and public realm that the New Urbanism offers, but the price tag is out of reach of many citizens. TNDs offer a range of housing types, and most include rental units. But that strategy does not ensure that for-sale housing will be affordable to a broad segment of the market — or cost-competitive with conventional surburbia. If the New Urbanism is to move beyond a tiny niche in the real estate industry — and the movement must do that to achieve its broad goals — practitioners must find a way to produce affordable for-sale housing. From a developer’s perspective, affordability may be imperative. Many find themselves in a “chicken and egg” quandary regarding a town center — they can’t build retail until more people buy houses, but the houses aren’t as attractive without the town center. If a developer doesn’t have the deep pockets of Disney (which built Celebration’s town center first) then strong home sales in the first few years are needed to quickly create the rooftops to justify retail. One way to generate strong sales in most TNDs — i.e. those not in a resort area — is to compete directly with suburbia on a price basis. That’s a tough proposition because suburban production housing is cheap and TNDs have extra costs. These costs are related to New Urbanisms’ high aspirations of creating a quality public realm. They include neighborhood greens, town square and plazas, wide sidewalks and nice detailing of streets, rear lanes to get garages off of the street, and front porches and/or detailing of facades. Fortunately, there are ways to offer these features and still make TNDs affordable. Developers around the country who are building and selling moderately priced housing within neo- traditional projects focus on a number of advantages associated with the new urbanist approach. First and foremost, it can greatly simplify home designs. Without a garage in front, the builder is left with a box — and many more options for configuring floor plans and interior space. Simple designs are less expensive to build, and allow architectural elements like windows to be lined up on exterior elevations. “Go to a simple form — that’s the advantage of traditional versus conventional,” says Robert Turner, who developed a neotraditional infill neighborhood in Port Royal, South Carolina. He also is involved in the development of two other new urbanist projects. garage options Selling detached garages in the back means that the developers can give buyers the option of going with a less expensive carport — or even eliminating the garage altogether and parking on a pad. Conversely, an accessory unit can be built on top of a garage — with rental income used to offset mortgage payments. All of these options are available with the same house. New Urbanism also offers great flexibility in housing types, and some developers are taking advantage of this by selling a certain percentage of homes that are smaller than new detached units typically found in suburbia. Robert Turner’s Port Royal project is a good example of moderately priced New Urbanism. The 43-home project, with a row of retail shops, is built on a formerly vacant 4.5 acre parcel connected to the old main street. Turner did not get the land cheap, paying the city $160,000 (about $35,000/acre), considering the slow real estate market within the historic area of town at the time, he says. Furthermore, Turner was offering small-lot, neotraditional new homes, designed by Eric Moser and Rick Thompson, unlike anything available on the market for decades. The single detached homes — all of them with porches eight feet deep across the entire front — began selling at $78,000. Four years later, the project is nearly sold out (41 homes sold) and the top priced model fetched $159,000, which reflects the wide range in housing options and an escalation in prices due to demand. Turner reports that his land yield — revenue per square foot of lot — is higher than the upper end suburban style projects outside of town. Even though the big suburban houses sell for much more, they are built on one acre lots and Turner’s lots are less than one-tenth of an acre (4,000 square feet). “I’ve proved that you can still build an affordable product and get a high yield on the land,” he says. inexpensive character The key is to design “character” into the homes and streetscape, and yet keep costs down, Turner explains. Character comes from the porches and details. In the least expensive models, the porches are built with a simple post and beam construction method -- but they are still full size, creating a real “outdoor room” for residents, and even a simple, functional porch can be a charming design feature. Turner offers many house sizes, starting quite small (about 1,200 square feet). He allows buyers to choose a detached garage, a carport or no structure at all for the car. “We let people start at the bottom and work their way up,” Turner explains. When buyers don’t get a garage, the storage problem is solved with a six-foot tall shed that attaches to the rear of the house, which gives residents a place to put their yard equipment, bicycles and other items. Maximizing builder efficiency is important, Turner adds. One way to do this is to create multiple elevations— perhaps four — of the same floor plan. That creates variety on the streetscape, “but the builders can gear up and understand how to build a home,” he says. “The first home is pretty good, but the second is better and the third is better still.” Sometimes costs can be saved in details without sacrificing integrity. “Exposing rafters saves money and can look good,” he explains. Low cost housing makes a nice streetscape Townhomes in Historic Kirkwood in Kirkland, Illinois, start at $99,000 and single family detached homes at $129,000 (see photo on page 1). For this price, the project offers walkable, attractive streets in close proximity to an authentic, historic Main Street. “That just proves that if you build simple boxes, line things up on the street and pull back the garage, you are creating a streetscape and it works,” says Chuck Hanlon of Land Planning Services, the master planner. Historic Kirkwood is a 90-unit, 20-acre neotraditional extension to the existing town of Kirkland, which is about 60 miles west of Chicago. The single homes are mainly located on 40 by 120-foot lots served by alleys. Most houses, including townhomes, come with detached garages on alleys. Some bigger, front-loaded lots — with garages behind the homes served by long driveways — are located on the perimeter of the site. Most have a full package of amenities built in — including central air conditioning and appliances. Homeowners customize the front elevations. “Every house is given a unique look; we’re not tract builders,” says Phil Pearson, a partner in the project. Depending on the materials chosen, this customization could cost extra — but not necessarily. The home plans — which Pearson created himself — are the key to keeping costs down, he says. “I started by looking at Sears home plans from 1909,” he explains. “They looked great on the outside, but the insides are so outdated that they had to be completely redone.” The least expensive single homes are 25 feet wide by 31 feet deep, with one beam in the middle of the basement. An extended kitchen creates an L-shape on the first floor in some models. The finished space in the house totals 1,550 square feet, and the basement adds significant potential living space. A large peaked attic on both the house and detached garage add storage space. Pearson designs a wide open first floor, which provides flexibility on the side elevations. Creating a decent looking side elevation is particularly important on the block corners — or where homes are located next to a neighborhood park, he adds. Kirkwood has sold slowly at the start — 25 homes in a little over two years. That pace has been adequate, says Pearson, who has seen a pickup in sales in recent months. “With this type of development it takes time to form a neighborhood,” he explains. “Now people come in and say it’s cute. When we just had a few houses under construction and the yards were not finished, it was rough.” Competing with mobile homes Construction is just beginning on Silver Oaks Village in Zephyrhills, Florida, an area where mobile homes and very inexpensive single family units constitute the bulk of housing. “This is not a market where research indicates that people are willing to pay a lot more, or any more, for a TND,” says Jim Constantine, a planner for Looney Ricks Kiss, the designer of Silver Oaks. “So the challenge becomes how can you create a better living environment while competing dollar for dollar with conventional suburban development.” The lowest price homes will start at $55,000, according to Constantine. These will be 750 square foot shotgun cottages (see image on page 5) designed by Dan Camp, a builder and developer from Starkville, Mississippi. The cottages have front and back porches, two bedrooms and a surprisingly generous living room — 13 feet by 15 feet with a vaulted ceiling. Camp, who got his start by building boats, designed the kitchen in the hallway to save space. The homes have no garages and face narrow lanes. “These cottages are designed to compete with a mobile home,” says Constantine. “That’s our product market and we’re delivering, at a very competitive price, an alternative that obviously has more character and livability.” Other houses in Silver Oaks start at $80,000 and go up to $130,000. The smallest are 1,100 square feet on a 36-foot-wide lot. Silver Oaks Development Co. is not counting on any “premium” from the traditional neigh-borhood design, although the phasing of the project is designed to take advantage of a premium if enough demand materializes, Constantine says. The use of vinyl siding will be allowed on some of the Silver Oaks Village homes (it will be avoided on the shotgun cottages and single homes on the main boulevard). Employing production housing methods Michael McAfee, project manager for Avalon Park near Orlando, Florida, prefers not to use the word “affordable,” because he believes it implies “government subsidy.” Nevertheless, the 1,860-acre, 4,150-unit traditional neighborhood development (TND) will offer relatively inexpensive detached single homes starting at $110,000 when model homes are finished by the summer of 1998. The average price of a home in the Orlando market — including both new and existing homes — is $100,000, according to the National Association of Home Builders. New homes average about $120,000 in the east Orlando area, says McAfee. “Much of what has been done in TNDs is inaccessible to 90 percent of the market,” McAfee says. “We want to make these homes available to 70 to 80 percent of the market.” The primary builder in the first phase, 203-lot Live Oak Village, is American Heritage Homes. Eight production home models from 1,350 to 3,000 square feet on lots 45 to 60 feet wide, all with rear garages on alleys, will be available. In addition, semi-custom and custom homes will be available on larger lots, with driveways, backing up to green space. McAfee explains that Avalon Park must keep the cost of construction down to very close to $35/square foot, which is what conventional production homes cost to build in Orlando. That’s the only way that the project will be able to maintain a targeted sales pace of 200 to 250 homes a year — generating enough “rooftops” to build a town center within a reasonable period of time. While accomplishing this, the developer hopes to provide the character and benefits of a TND — with varied, traditional, garage-free front elevations and relatively narrow lots, in addition to civic spaces and a town center. “A big part of how we are [keeping costs down] is by working with a builder who will operate on a production basis, as opposed to the custom, building by building, approach that a lot of TNDs use,” he says. “We’re try-ing to employ the best practices of production housing, keeping things at a volume of at least two or three homes a week, so the construction crews can go from one house to the next.” Building a new urbanist project requires extra expense, but also presents opportunities for savings, McAfee says. The TND savings, according to McAfee, include reduced costs for detailing on garages, which will be in the rear, not in front of a house. Also, taking the garage away from the front affords the possibility of more potential floor plans and elevations, he says. “When you don’t have to accommodate the garage, sometimes you can achieve savings on interior construction,” he explains, “by doing things like lining up the kitchen below the bathroom, which you may not be able to do with a conventional house.” Offering “starter” models One way to offer affordable housing in a neotraditional development is to build low-cost “starter” homes along with more expensive units. McKenzie Towne in Calgary, Alberta, a 2,400-acre traditional neighborhood development (TND) designed by Duany Plater-Zyberk & Company (DPZ) that will eventually have 10,000 units, offers single family detached homes starting at $125,000 Canadian ($87,000 U.S. at current exchange rates). These two-story homes are 1,100 square feet with no garage (homeowners can build their own detached garage later). The highest price starter homes are 1,500 square feet with a two-car garage, and sell for $160,000 Canadian ($112,000 U.S.). Partly because of its affordability, McKenzie Towne is outselling the com-petition, reports developer Carma, one of Western Canada’s top home builders (the neotraditional project even is outselling most of Carma’s conventional projects). More than 400 houses have been built since the project began home construction in early 1996.