February column for Builder & Developer magazine now online

My column for the February 2015 issue of Builder and Developer magazine is now posted online.

For this issue, entitled "The Nationals at the 2015 International Builders Show" I chose to profile three different local projects here in Los Angeles Count which have won the Gold Award for various categories.  An excerpt:

...As a usual part of the show, the 35th annual National Sales and Marketing Awards – known as The Nationals – paid tribute to notable achievements by homebuilders, architects, designers and other associates as well as sales and marketing councils.

Since the winners of The Nationals tend to point towards the latest trends in new home architecture and design, I wanted to focus on a few of these local stand-out projects as well as to offer my congratulations to the very talented folks who made it all possible...

To read the entire column, click here.

To read the entire February 2015 issue in digital format, click here.

The Nationals at the 2015 IBS: Winners showcase trends in usability, design and architecture

By nearly any measure, this year’s International Builders Show in Las Vegas was a huge success, with attendance up by eight percent over last year’s total to over 55,200.  But IBS was just part of a larger show dubbed Design and Construction Week, in which over 125,000 people also attended the Kitchen and Bath Industry Show, the International Window Coverings Expo, The International Surface Event and the Las Vegas Market.  The combination of the crowds and the positive energy among the 3,750 exhibitors across the various venues made it by far the biggest show since the Great Recession.

As a usual part of the show, the 35^th annual National Sales and Marketing Awards – known as The Nationals – paid tribute to notable achievements by homebuilders, architects, designers and other associates as well as sales and marketing councils.

Since the winners of The Nationals tend to point towards the latest trends in new home architecture and design, I wanted to focus on a few of these local stand-out projects as well as to offer my congratulations to the very talented folks who made it all possible.

Here in the City of Los Angeles, the built-out nature of the region means that infill builders have to be creative, providing the cues that today’s buyers want while also fitting in with the local community.  In the case of Trumark Homes’ SL70 in the Silverlake community north of the downtown area – winner of both Detached Community of the Year as well as Best Architectural Design of a Single Family Home Under 2,000 Sq. Ft. -- a lack of buildable land meant building up without losing the private spaces inherent in a detached unit.

To solve this conundrum, architect JZMK Partners came up with a unique plan in which the homes, which are built next to each other much like townhomes, still enjoy fee-simple ownership and structural independence for each unit, which also eliminates the need for an HOA while allowing up to 70 separate units on limited acreage.  Priced from the low $600,000s for up to nearly 1,800 square feet of living space, each home provides two-car garages, three levels of living space, plus outdoor terraces as well as some usable rooftop decks.  Targeted towards the hipsters with money who long ago put Silverlake on the map, the idea is to provide indoor-outdoor living without yards in a mature community that offers a very reasonable commute to jobs in the downtown core.

Meanwhile, less than ten miles to the west, builder Essex/Monarch hired Newman Garrison + Partners for its The Dylan mixed-use apartment project on the eastern edge of West Hollywood.  Winning Best Architectural Design for an Attached Community in an urban environment, this project overlooking Santa Monica Blvd. caters to the luxury apartment tenant for whom location and amenities are paramount.  On the ground floor, a ‘jewel box’ lobby opens out to a mix of local retail and food outlets along with a outdoor seating plaza.  Priced from over $2,000 to nearly $5,000 per month, the idea is to provide a resort-like environment in an urban setting with amenities such as a private screening room (with free wifi access for streaming online), a two-story clubhouse lounge, a fitness center that negates the need for a separate gym membership, and a rooftop terrace with another lounge, built-in BBQ grills and a wall suitable for showing outdoor movies.

Finally, in the old money community of Pasadena, builder City Ventures hired William Hezmalhalch Architects to address numerous constraints related to its Ambassador Gardens project on the former site of Ambassador College, which closed in 1997 and, with its existing mansions and garden areas, remains a popular venue for weddings and other public events.  Winning Best Architectural Design of an Attached Community, the Gardens took shape on 19 of the site’s 29 acres and involved repurposing a century-old estate surrounded by “Millionaire’s Row” mansions with existing high-quality appointments – as well as to please neighborhood groups and a City Hall demanding a high-quality development on a site with a rich, storied past.

Priced from the low $1 millions, the collection of flats and townhomes with hidden, underground parking along with service elevators were built to blend in with both the neighborhood and the local gardens by recreating the Craftsman, English Arts & Crafts style which has defined Pasadena for decades.  In addition, the restored Merritt Mansion, one of Pasadena’s cherished pieces of history, serves as the sales and design center and will be sold as a single-family home once sales have been completed.

March column for Builder & Developer magazine now online

My column for the March 2014 issue of Builder and Developer magazine is now posted online.

For this issue, entitled "A Bigger, Better Show Filled with Optimism," I covered my week at the 2014 International Builders Show in Las Vegas.  An excerpt:

Back in 2008 when I attended the International Builders' Show in Las Vegas, the mood was somber, the exhibit floor was depressing and education sessions were focusing just as much on avoiding bankruptcy and working with lenders as they were about new products, services and trends. 

Fast-forward to 2014, however, and this year’s show in early February was entirely different. Firstly, it was huge: more than 75,000 attendees filled the convention center for Design & Construction Week, which paired together IBS, the Kitchen and Bath Industry Show and International Window Coverings Expo in more than 650,000 square feet of exhibit space.

For IBS alone, exhibit space grew by 24 percent over last year’s totals, which certainly points to the growing confidence for our industry. Secondly, there was a level of optimism that I’d not seen since the mid-2000s. And thirdly, the decision to shrink education sessions to 60 minutes meant more time to wander the exhibit floors as well as to squeeze in more sessions...

To read the entire column, click here.

To read the entire March 2014 issue in digital format, click here.

2014 IBS: A bigger, better show filled with optimism

Back in 2008 when I attended the International Builders Show in Las Vegas, the mood was somber, the exhibit floor was depressing and education sessions were focusing just as much on avoiding bankruptcy and working with lenders as they were about new products, services and trends.

Fast-forward to 2014, however, and this year’s show in early February was entirely different.  Firstly, it was huge:  more than 75,000 attendees filled the convention center for Design and Construction Week, which paired together IBS, the Kitchen and Bath Industry Show and International Window Coverings Expo in more than 650,000 square feet of exhibit space.  For IBS alone, exhibit space grew by 24 percent over last year’s totals, which certainly points to the growing confidence for our industry.  Secondly, there was a level of optimism that I’d not seen since the mid-2000s.  And thirdly, the decision to shrink education sessions to 60 minutes meant more time to wander the exhibit floors as well as to squeeze in more sessions.

The cheerfulness certainly has legs, with NAHB Chief Economist David Crowe forecasting 822,000 single-family housing starts for 2014 – likely more than 200,000 over 2013 levels.  His relatively aggressive forecast is due to five main reasons:  consumer confidence has returned, pent-up demand is finally converting from theory to actuality, there is a growing need for new construction as the existing housing stock ages, there are much fewer distressed sales, and builders are increasingly taking advantage of these trends.

Not surprisingly the Housing Market Index, which tracks builder optimism, remained above 50 for eight straight months through January before dipping in February due to severe weather. In addition, 58 of the 350 metro markets tracked by the Leading Markets Index have returned to or exceeded their normal levels of economic and housing activity.  As of February, the national housing market is running at 87 percent of its long-term average.  Still, there do remain significant headwinds between today and a full recovery, such as rising prices for building supplies, tight mortgage credit, ongoing challenges with accurate appraisals for new homes, and constrained supply of developed lots and labor.

For the multi-family housing sector, Crowe is forecasting a level of starts by 2015 that’s just above the long-term average of 340,000 as more young adults prefer renting over buying – at least for now.  The strong performance for this sector is due mostly to starts returning to more normal levels, the need to house Echo Boomers born after 1980 and a higher percentage of households renting until the job market is stronger, careers more stable and mortgages easier to obtain.

In terms of product design, there were also some ongoing trends magnified by the recent winners of the Best in American Living Awards during the show’s run.  For example, we’re seeing a return to using the color white to brighten up rooms, focus on clean lines and project a modern feel.  This is made even more important when selecting a historic architectural style such as Craftsman, Prairie, Mid-Century Modern in order to properly take advantage of today’s building methods.  Dual master baths with a shared shower can still provide a spa-like experience while still being practical.

The great outdoors, long incorporated into a new home’s merchandising in the Sun Belt states, is now going nationwide, with more interior courtyards (especially on side yards), moveable glass walls or more foldable French doors, outdoor kitchens for gourmets chefs and grillers, and even courtyard pools that better bridge the gap between outside and in.

Outside the home, we’re seeing a return to bolder colors on the exteriors, made possible through a mix of paint, cladding materials, doors, windows, porches, shutters and trim.  Importantly, this is also another way for builders to better differentiate their product with the existing housing stock.  Luxury amenities are also returning for the discriminating buyer, such as communal kitchens for cooking classes, pools with their own lazy rivers, electric car charging stations and even pools and parks for dogs.

Yet for sheer brilliance, my vote would go for the Push Pull Rotate Door Locks offered by Brinks Home Security, which won top honors at the second annual Best of IBS Awards.  This new locking system opens in three ways:  by turning the knob the traditional way, pushing inward or pulling outward to release the latch.  It won largely because the judges noted that it both solves the problem of how to open a door when your hands are full as well as helping older residents whose hands have lost dexterity.  I certainly know what’s going on my Christmas list!

Promoting New Over Used Homes

Without a doubt, the energy at this year’s International Builders Show in Las Vegas was characterized by an optimism missing in recent years.  At the same time, however, there was also a distinctive undercurrent that as the housing market foundered over the last half-decade, the world of communications and technology continued to evolve and transform many of its own major players.

What this means to the industry is that as the potential demand for new homes improves, not only will marketers have to become even more expert at digital initiatives such as Facebook, Twitter, YouTube and Instagram, but re-engage homebuyers to convince them of the benefits of new over existing homes.

According to Builder Homesite, Inc. (BHI) – the Texas-based consultancy and collection of Web sites owned by a consortium of 32 builders – while 19% of potential homebuyers prefer a new home and another 35% are somewhat agnostic to either new or used homes, just 7% of homes now sold nationally are new homes, or about half their historical average.

In the aggregate, market share certainly adds up, with each percentage point adding up to $8 billion in annual revenue.  BHI contends that if builders could capture two-thirds of those buyers who prefer new homes and one-third of the ‘agnostics,’ market share could more than triple to 25%.

While many builders would lay the blame of today’s relatively poor capture rate on a weak economy, high unemployment and tighter lending standards, BHI’s Tim Costello would argue that the primary problem is actually how most builders market their products.  To make his point during a brief presentation in Las Vegas, he showed a series of actual billboard and display ads that focused only on price or payment while ignoring those features which make new homes preferable to existing ones, such as lower energy costs, better floor plans, quality of construction and a warranty.

To address this issue, BHI is preparing a series of sample marketing materials in collaboration with GSD&M Advertising and public relations firm Edelman – at no cost -- which can be customized for a builder based on specific market needs.  Like the “Got Milk?” ads which became part of popular culture starting in the early 1990s, the idea for this three-year campaign is to reinvest in the entire industry in order to drive new sales for all builders.

By changing the nomenclature from “resale” to “used home,” the campaign also hopes to plant the preference for a new home in a consumer’s mind today even through a ‘trigger event’ such as getting married, a new child or a relocation may be years off.  Then, when the fateful day comes, the fact that a used home can force compromises on unsuspecting buyers such as inflexible designs, higher energy costs or unexpected repair and maintenance bills may be foremost in their minds.

For BHI, this is a brilliant marketing strategy for its own suite of marketing services by leveraging its unique niche in the marketplace, its comprehensive industry connections and 13 years of experience.  As the market continues to improve, I’m sure that BHI expects smaller and up-and-coming builders to turn to them for many of their marketing needs as opposed to beefing up internal operations or hiring local advertising and public relations advisors.  Of course, whether or not that’s a game changer for the industry itself remains to be seen.

BHI also plans to dramatically increase outreach to Realtors, who generally don’t show new homes to clients for two reasons: (1) new homes usually aren’t listed on local multiple listing services (or when they are don’t feature information on the overall community or amenities); and (2) builders have not been consistent on how they treat leads from resale agents, especially those catering to buyers.  I’ve long argued that when certain builders only offer commission splits to outside agents when times are bad and ignore them when sales are booming, that only serves to damage any long-term relationships; agents feel used, and who could blame them?

Moreover, many builders do little if anything to encourage agents to continue showing their product to new clients.  When I worked for a builder with operations in Arizona – a market in which outside agents were a key factor in driving sales – I came up with a loyalty program in which the ‘prizes’ got increasingly generous with each new sale.  By actively and consistently partnering with the resale community, builders could thus encourage outside agents to also start promoting the benefits of new over used homes.

October column for Builder & Developer magazine now online

My October column for Builder & Developer magazine is now posted online. For this month's issue, which is entitled "The Changing New Home Interior" -- I discussed as new homes are becoming smaller, they're requiring design changes that increase both the efficiency of energy use and space. One primary example of this was the Home for the New Economy introduced in early 2010 at the annual International Builders Show.

An excerpt:

Owing to intense competition from discounted foreclosures, the end of demand for McMansions and a growing interest in sustainability, the Home for the New Economy -- introduced earlier this year at the International Builders Show -- promised a design that will compete with older sales homes in terms of both cost and utility. The only problem back in January? The home was built in digital format only as a 3-D rendering and had yet to be offered to the home-buying public.

Since then, however, the former concept home has become a reality at Warwick Grove, built by Leyland Alliance in Warwick, N.Y. Originally conceived as a real-world test project, Leyland has managed to sign contracts for several more in what is still a mostly traditional neighborhood.

The Changing New Home Interior

Owing to intense competition from discounted foreclosures, the end of demand for McMansions and a growing interest in sustainability, the Home for the New Economy introduced earlier this year at the International Builders Show promised a design that will compete with older resale homes in terms of both cost and utility. The only problem back in January? The home was built in digital format only as a 3-D rendering, and had yet to be offered to the home buying public.

Since then, however, the former concept home has become a reality at Warwick Grove, built by Leyland Alliance in Warwick, New York. Originally conceived as a real-world test project, Leyland has managed to sign contracts for several more in what is still a mostly traditional neighborhood.

So what makes this new design so different? Besides a much smaller size – 1676 square feet featuring three bedrooms and 2.5 baths – a simplified building design which takes advantage of standard sizes for supplies has cut hard construction costs to just $100 per square foot. Other builders in South Carolina, Virginia and outside the Canadian cities of Toronto and Calgary have also joined in, with some modifications for their local markets including laundry rooms or flipping the upstairs bedrooms below grade.

The Home for the New Economy was the brainchild of New York-based designer Marianne Cusato, the same person who signed up retailer Lowe’s to market her 300-square-foot “Katrina Cottages,” introduced in 2005 as a better substitute than FEMA trailers to house victims displaced by Hurricane Katrina.

As an extension of the tiny Cottage, these larger homes still feature clever space-savers, natural light, high flat ceiling plates versus inefficient vaulted ceilings and operable windows on every outside wall that bring in light while also promoting cross ventilation. Room sizes are also important, with common spaces justifiably larger than lesser-trafficked rooms such as bedrooms or bathrooms. In addition, bedrooms feature increased insulation between walls and closets to accommodate a noisy clarinet practice session or a mini home theater.

But the true calling card of Cusato’s design is the idea of a first-floor adaptable suite, which can function as a family room, office or master bedroom or can also be closed off and offer privacy to an in-law, an adult child or even a paying tenant. For maximum flexibility, the suite’s closet even comes with rough plumbing that can expand into a kitchenette while a separate porch can provide a separate entrance. Given today’s economic realities of increasingly aging in place, homes that are built to offer flexible uses over an owner’s lifetime are becoming much more than an interesting idea.

For the crucial kitchen and bath areas, controlling clutter in a smaller space becomes a primary focus. Even though the kitchen measures just 11 by 12 feet, a combination of deep drawers, pantry shelves, a two-level eating bar and stacked upper cabinets take advantage of the 10-foot ceilings while also maximizing storage space. In the secondary bathroom, a separate alcove for a stacked washer and dryer further takes advantage of the existing plumbing while eliminating the need for a separate room. Best of all, since kitchens and bathrooms are grouped together or stacked on top of each other, plumbing becomes much simpler to install as well as maintain.

Finally, the design also considers its role as part of a larger community; instead of simply being plopped down and demanding attention for their own specific elevation elements of brick or wood or stone, the homes are envisioned to make a statement as part of an entire community. And that change alone could be a primary reason for a buyer to consider a new home versus an existing foreclosure.

754,000 new housing starts by 4Q 2010?

At the 2010 International Builders Show this week in Las Vegas, the NAHB's chief economist David Crowe is predicting a rise in home starts for the spring, a dip mid-year (as tax credits expire) and then another rise by the end of 2010. From BigBuilderOnline.com:

The pace of housing starts will speed up this spring, slow and perhaps reverse course at mid-year, and then re-accelerate next winter and into 2011, the National Association of Home Builders' chief economist forecast today.

David Crowe said the number of combined single and multifamily housing starts will rise from an annual rate of 565,000 in 2009's first quarter to 677,000 this quarter. He forecast starts would climb to 688,000 in the second quarter of 2010, slip to 669,000 in the third quarter, and then rebound to 754,000 in the final three months of 2010.

Starts will keep escalating robustly in 2011, he predicted, climbing from an annual rate of 870,000 in the first quarter of that year to 1.22 million in October through December 2011...

Click here for entire story.

Attending the Int'l Builders Show in Las Vegas?

The 2009 International Builders Show is just days away (January 20-23 in Las Vegas). The Web site for Builder magazine has some interesting stories for any one planning to attend the show, as summarized below.

I will be attending this year on Tuesday, Wednesday and Thursday to cover the show for Builder & Developer magazine, so if you see me please feel free to introduce yourself and say hello.

• How Green Is the Valley?

  The Southern Nevada Green Building Partnership might be a catalyst for reviving the Las Vegas market.

• Show Home Tour

  Two very different show homes for the 2009 International Builders' Show in Las Vegas.

• Information Age

  IBS '09 offers 250 educational programs during show week. These caught our attention.

• Hot Products

  The exhibit floor is sure to be chock-full of good ideas. Here are a few to look out for.

• First Time?

  The IBS will offer an orientation to first-time attendees and an a la carte fee structure to attract builders to the show.

• Green Day, Take Two

  The NAHB follows up last year's successful launch of green building initiatives will a full slate of activities in 2009.

• Coached Up

  Lou Holtz headlines the show as this year's keynote speaker.