Transcript
Dean Wehrli:
Hey, this is Dean Wehrli for New Home Insights by John Burns Real Estate Consulting with part two of our discussions with some of the people who brought us some of the best-selling master plans of 2020. First up today is Colleen Edwards. She’s responsible for marketing and branding for the River Islands master plan. That’s an 11,000 unit mixed-use community in the Central Valley of Northern California. She has long been in California a legend in the marketing of new homes. She’s been a columnist, a radio host, and a podcaster herself, jealous, and has even written a book on new home marketing. Also, jealous. She is in the state’s Home Building Foundation’s Hall of Fame and deserves it.
Colleen Edwards, Marketing Director at River Islands
Dean Wehrli:
Colleen Edwards, managing director at the River Islands, master plan. Good morning, how are you?
Colleen Edwards:
Hi. Great and glad to be here.
Dean Wehrli:
I’m glad you’re here too. Colleen, is the driving force in my opinion of the River Islands master plan. She’s one of the legends of California sales and marketing and creative force behind housing for many, many years. Okay, not that many. Okay, many years. And she’s been at River Islands master plan since I believe 2014, from its inception, is that right?
Colleen Edwards:
Absolutely so.
Dean Wehrli:
And this past year River Islands made the top 50 best-selling list of ours, coming in at 24th, with 640 sales. River Islands has been successful from day one, but that’s a 56% increase to you every year, remarkable.
Colleen Edwards:
I want you to think about this. This is like you’ve thrown a party and a bunch of people you didn’t invited showed up. We were happy to have them all in.
Dean Wehrli:
That’s good. That’s a good party. Because sometimes that can go sideways and you’re not happy to have them show up. Friends of friends and they’re packing heat that these guys are here.
Colleen Edwards:
I had a kegger, it was fine.
Dean Wehrli:
They were friendly. Let’s start off. What has been your biggest main sales driver at River Islands this past year and into this year?
Colleen Edwards:
The moment Mark Zuckerberg told people they could work from home, the number of people beating a path to River Islands and buying a house, you could see the difference in our sales in one year. It’s still us. We’re still in the same location. It just says that 73 miles from the Silicon Valley just didn’t matter anymore. In the early days, people bought in spite of our location, given the world today, they bought because of our location. And again, what a difference a day makes. Given that people can buy a house for about half the price of that in the Bay area, and that the house has set up to six bedrooms, all of a sudden you can buy a home that you could afford to live in with a home office or two home offices and maybe a home classroom. It took us from being behind the crowd, way to the top of the class. It’s been a wonderful place to be.
Dean Wehrli:
We should geographically place you. As a matter of fact, I should have done that already. So Lathrop, as you said, it’s about 70 miles or so from Silicon Valley, it’s an exurb-
Colleen Edwards:
About the same from San Francisco.
Dean Wehrli:
San Francisco, but it really has historically always been impacted strongly by those folks working in community, into jobs into the core Bay area, and if anything, more so as the years have gone on, as your prices have increased.
Colleen Edwards:
So about a third of our buyers, early on we were 50 – 50, 50% local central Valley buyer move up, 50% Bay area buyer. Split into young tech families who were willing to drive forever to get their first house and seniors who didn’t care what rush hour traffic was like, they say weren’t out in any way.
Dean Wehrli:
I’m going to ask this question. I know the answer. You have definitely been impacted by that COVID, that work from home, that out migration from the Bay area, are they looking for a lower density product? Are they looking for a lower density environment? Are they looking for a master plan amenities? What’s been the main driver?
Colleen Edwards:
Luckily you ask a good question and you embed some answers in it. What ended up happening is people wanted to be able to have the great outdoors closer to them, and yet they wanted to have what I call the great indoors as well. When you live on 5,000 acres, it’s pretty easy to keep six feet apart. And oddly, this is funny, because I don’t take any claim for being Irish and prescient, but my headline for the website says, escape to the islands. That’s what people did for the last year.
Dean Wehrli:
Really? That’s going to come back to haunt you because I’m going to ask you if you for your crystal ball here. Has there been any segment that has been your outstanding performer? Any buyer segment that has really become a bigger part of your demand than you expected or has really driven the sales this year or this past year or so?
Colleen Edwards:
Well, the younger buyer profile, the first and second time buyers, the people that already had a house, maybe it was already a condo closer into their jobs in the Silicon Valley. Just that we’re moving out now. It’s time to get some fresh air. And because of the fact that we had taken care of the schools issue by starting our own series of charter schools, people came out and they weren’t just doing it for themselves. They were doing it as an investment in their family’s future. And that certainly paid off.
Dean Wehrli:
Has there been any specific marketing tactic or outreach or social media, whatever that has been particularly impactful and helpful lately?
Colleen Edwards:
I’d say that the social media has led the band on all of this, because it meant that several times a week, we could change out the visual, show a video clip, you thinking about working from home and you see somebody paddle boarding out the lake, out of the back of your house and you’re thinking, I’m sitting in a condo in Sunnyvale with a what? I think we were able to show a lot of romance about what your life could be like outside of your little home office and gave you the notion that there was a life to be had out here.
Dean Wehrli:
You’ve had a lot of the apartment folks going from a Bay area apartment directly to your big, beautiful homes there.
Colleen Edwards:
Well, if you think about it, you need to be able to make about a hundred thousand bucks to move into River Islands, and who in the Silicon Valley isn’t making at least a hundred thousand dollars a year. So for the younger kids, if it was a matter of getting their down payment together, they were fine on their monthly, but for their down, I absolutely believe that River Islands is as driven by the influencers of our buyers as it is by the buyers themselves. And let me take a minute on this, because this is a good point. When you’re a youngster, the influencer is your mother who calls up and says, I found your house and I’m going to help you with the down payment. If you’re a senior, it’s because your kids called you and said, we’re buying at River Islands. Why don’t you come out too and we can all be together. We see lots and lots of family buyers like that.
Dean Wehrli:
And so for the most part, they had no ties early on to that part of the world, that part of California, but increasingly you’re getting folks that, that word of mouth is becoming critical?
Colleen Edwards:
Absolutely. And the thing is it reminds me of the way that the world used to be. Where you lived in one house and your grandparents lived a couple blocks away, and your crazy Uncle Charlie lived in the same neighborhood. We see a lot of that now, so it’s not just some of our product planning is terrific and takes care of that in one house, we’ll have a multi-generational house with separate entrances. But, we also do see people buying product that suits them and yet they’re all within walking distance. I had a lovely note from Doug Dahlin, star architect. He was out there on the first day of school last year and wrote us a love note that said essentially, this just made my heart happy to see all these people, of all these ages, dropping off all these kids, so ethnically diverse, so culturally diverse, all at this school. This is what we do. This is why we do what we do.
Dean Wehrli:
So ethnically, I should say demographically, then it’s a pretty good fit for the Bay area, isn’t it? Maybe more than people might think, moving from the Bay area to the central Valley, you still have that diversity that a lot of folks desire.
Colleen Edwards:
Well, it’s just so cool. If you took a look at the 2010 census for Lathrop, for example, versus the 2020, talk about a crazy quilt now of folks from just all over truly representing the whole Bay area at its best. And the best way of looking I think is to be Doug Dahlen, and look at the school yard. It just makes your heart happy.
Dean Wehrli:
So you have 5,000 acres there. Staying six feet apart is not as hard as it may be in other places, but has it been a chore or have you had to change tactics to maintain the livability of your master plan in this COVID time?
Colleen Edwards:
Well, yes and no. So we have dedicated a number of our parks to the city. And so if the city of Lathrop has their parks closed because they don’t want people getting cooties off the playground equipment, then we’re closed as well. But you don’t close down a trail system on the San Joaquin river. And you don’t close down the number of areas that are just wide open and paved along all those lakes. A number of our lakes, as you know Dean, are built with houses all around them and they’re primarily for the people that live in that neighborhood, but we have community lakes as well, and you don’t close down a shoreline.
Colleen Edwards:
People still have this feeling of being outside if you’re on the San Joaquin river. There’s all of the bugs and bunnies, all of the flora and fauna, and there’s really quite a bit of that trail open already. I think that’s been very attractive for people. And even if the playground equipment is closed, the green areas of the park are open. For people that like green and blue, I’m delivering it. I got a great big blue sky and a lot of green parks and a lot of blue water for them.
Dean Wehrli:
And the bugs along the rivers, but not so many alligators are there? I’m sorry I’ve-
Colleen Edwards:
Take that to Florida.
Dean Wehrli:
There’s only six California master plans on our top 50 lists and there’s eleven to seven Florida master plan, so I’m just being defensive here.
Colleen Edwards:
No, I got to tell you. I’m so proud because not only are we never 24 on your list, but if you cite all of your communities, we’re number one for Northern California.
Dean Wehrli:
Absolutely.
Colleen Edwards:
Don’t think I didn’t make a headline about that.
Dean Wehrli:
No, It’s harder for, we don’t have the land or the, it is tougher to get entitlement. It is more difficult in California than in Florida in Texas, for sure. Do you think that master plans are viewed now as safer just relative to standalone communities or even infill areas? Is that part of what’s driving this too?
Colleen Edwards:
Oh, we certainly hear that in the sales offices, from the prospects. They think that they’re going to lead a healthier life by being out with us. And Dean, that wasn’t just because of COVID, that’s just people coming out and recognizing that you don’t have to get in your car to recreate that everything is within walking distance or bicycling distance of your house. And in years to come, as we build the business park and the town center, same difference. I think that what’s worked for us for all these years since 2014, is your life may have been very auto focused Monday through Friday, but the minute you got home, you left the keys in the car and had your River Island life, your River Island weekend. And when we do surveys of our buyers to find out how do you like living here? It turns out that if anything, they want us to bring more things so they never have to leave River Island. They look forward to the opening of the farmer’s market in the spring.
Colleen Edwards:
We’re going to do a drive-in movie night because we can’t do movie nights in the park yet. People love being together, and although they’ll tell me that they bought the house because the community was beautiful and the houses were a good value, the reason that they love staying at River Island is because they love hanging around and they love their neighbors, who says that?
Dean Wehrli:
That’s a good point. So master plans have always brought that what you just described to the table, but do you think that master plans, and maybe again, a little more of a pop, a little more of a premium than they did in this new era? Relative to pre-COVID.
Colleen Edwards:
Well, yes. Again, the open space is phenomenal. But I’ll also say that I think that at this point there’s two different kinds of master plans. There are those that look like subdivisions that just happen to all joined together and a quilt of houses. And there are those that are where neighborhoods are separated and demarcated by Park lands, long open parkways, places for people to be and do. We talk about mixed use and it’ll be years before we’re truly mixed use with a transit center. As I said earlier, the business park, the town center. And people get the gist of that already. And I think that they invest themselves in that.
Dean Wehrli:
It’s funny you say that because in the analyses that we do, in the feasibility studies that we do, I differentiate between a true cohesive master plan, like River Islands and that aggregation of neighborhoods. And I’ve often found myself calm and like quasi master plans, because they’re not really master plans, but yours is.
Colleen Edwards:
And you look at the old ones, you drive through San Ramon, this Valley itself, before it became landlocked was, there were a lot of master plans. But looking back, what they are is just a collection of subdivisions that happened to a buddy, each other.
Dean Wehrli:
How have things been going so far in 21? More of the same? Just as well?
Colleen Edwards:
I think my biggest problem now is making sure that people feel like they’re being treated well and that the builders are engaged in the River Island culture, in terms of treating people fairly. Not making them feel like after going through… If they come from the Bay Area, my worry is that they’ve already been through all the hoops of trying to buy a resale in the Bay Area, and been rejected and so exhausted before they even get to River Island. And then when they find out that there is a priority list, or a quasi lottery, or the prices are going up between releases, I just don’t want them to do a total freak out and think that there’s no room for them there at River Island either. So I literally want to run an ad that says, don’t worry, we’ve got 11,000 more houses coming. Just hang in there with us. We’re going to keep building them. We’re like planters, peanuts, we got another one behind it. Just don’t worry about it.
Dean Wehrli:
You hear that everywhere all over the country. The biggest problem right now is keeping up with deliveries, with having any kind of inventory whatsoever, it’s the proverbial good product problem to have, but it still is a problem.
Colleen Edwards:
It’s a problem. And what I find very important is that my relationships with the marketing directors of all of the different builders in the community, I would say is pretty strong. And I check in with them all the time about, are you going to get your preview started, next month? Obviously I want more inventory. If they aren’t, what’s the holdup? Can I help you? One of our builders is thinking that they’re not going to really get started very soon. I said, the welcome center is currently not open because of COVID. Can I give you my conference room and turn it into your pre sales area? What I’m finding is you got to stay really flexible in a time like this and just practice ice skating backwards, because you just don’t know, while juggling live eels. You just have no control Dean. You just have to keep the smile and try to be smart all the time for everybody.
Dean Wehrli:
I can never ice skate backwards. It never happened. I’ve never tried to juggle eels, I might be better at that. They are. They can be difficult. I frankly don’t like dead eels either. Let’s end with, just what is it that sets River Island apart from the background noise? What is the most unique thing you offer?
Colleen Edwards:
I’m going to tell you this. You know how they used to say in many master plan campaigns, this is a place to live, work, play, whatever. If I were going to put all those things out there, I think the big word for people is belong. People want to put down roots. They want to feel like this is going to be their place, that it’s not just a transitory place going someplace better. I think people imagine themselves moving to the next neighborhood and the next neighborhood. So in my way of thinking, I spend almost as much time on my residents after the point of sale, making sure they’re happy.
Colleen Edwards:
We just hired an events coordinator just to think of things for them to do. A shamrock, a scavenger hunt is coming up for St. Patrick’s day for example. Back in the day, when I was just worrying about marketing subdivisions or marketing master plans that were more like subdivisions, I never thought about things after the point of sale. But this notion of belonging I think, answers a lot of the yearning of people, both the millennials who don’t know where they belong and are active adult buyer who really does want to put down roots and say, I didn’t compromise here. I got everything I wanted.
Dean Wehrli:
That’s a great point. Anyone can put the entry monumentation up that provides that sense of arrival, but a real sense of arrival is what you feel inside, like you’ve arrived at home, and that takes a lot more than just monumentation.
Colleen Edwards:
I am now the Margaret Mead of the Trobiand Islanders at River Island. Whoever thought I’d become a social anthropologist in my old age?
Dean Wehrli:
That is a great… Let’s end on that reference. I have not heard a Margaret Mead reference well, ever, doing this podcast, so that’s a great one. I appreciate that. Colleen, thank you so much for coming on.
Colleen Edwards:
Great playing, name that tune.
Dean Wehrli:
Awesome. Thanks Colleen.
Colleen Edwards:
See you later.
Laura Cole, Senior Vice President at Lakewood Ranch
Dean Wehrli:
Next up is Laura Cole. She is the residential and lifestyle leader at Lakewood Ranch. It’s a 31,000-acre master plan near Sarasota, Florida. That means she handles 21 actively selling communities with over 16,000 lots and 20 builders. Prior to joining the Lakewood Ranch team, Laura was the chief marketing officer for commercial and residential developments in the Washington DC complex for a few firms. But then she followed her love for alligators in her pool down to Florida and has never looked back.
Dean Wehrli:
Laura. Hi, how are you doing?
Laura Cole:
I’m doing well. How are you?
Dean Wehrli:
I am doing pretty well. We’re all doing fairly well all things considered, I think at least in this industry.
Laura Cole:
Yeah.
Dean Wehrli:
In fact, that’s what we’re talking about, how well your master plan Lakewood Ranch did in 2020. And I’m assuming I hope continues to do here in 21.
Laura Cole:
Indeed.
Dean Wehrli:
So Lakewood Ranch is in lovely Sarasota, Florida, and it was the second best-selling master plan in the country last year with a stunning 2,149 sales. Very impressive. Congratulations first.
Laura Cole:
Thank you. Thank you.
Dean Wehrli:
What was your biggest, your best, most important sales driver in a big picture way for Lakewood ranch last year?
Laura Cole:
Yeah, I mean, I think, well, you kind of the fact that we’re in Florida in Sarasota, which of course have been a magnet for in-migration. We’re fortunate to be in a great geographic area, but I think if you had to point to one factor, it would be Lakewood Ranch’s multi-generational appeal. And that’s particularly came into play, during COVID, because we were just starting, we were at the ready with a lifestyle and home offerings that really met the intense demand that came from COVID across the pricing spectrum and across the demographic spectrum.
Dean Wehrli:
So is there no buyer segment that kind of dominates are really just a very, very broad based?
Laura Cole:
We were really fortunate to have a lot of inventory and new neighborhoods coming out in the market at a time when finally that millennial buyer really kind of came roaring through. And when you couple that with the boomers that have really sort of sustained the market here since certainly since after the downturn and then every sort of… if you will, and demographics in between, which are of course less, but still a fairly active in this market as move up buyers. We just saw buyers across the spectrum and happened to be fortunate that we’d worked with builders proactively to meet that demand. Certainly we couldn’t have projected this unprecedented growth, but we did have, we were there, I think, at the ready. And there was a lifestyle here that really did appeal to all demographics.
Dean Wehrli:
So you were kind of ready to go if I’m reading between the lines, though you did get some of that augmentation from those folks fleeing, maybe denser areas, denser product?
Laura Cole:
Yeah. No question. I mean, we traditionally draw from the Northeast anyways, and of course we’d seen heightened demand from the market, especially the high tax markets, but we definitely saw, acceleration in sales coming from urban areas and bigger metropolitan areas, particularly around… I think we see it in sort of with two groups. One is we saw the younger families that because of remote work, had the flexibility of relocating to Lakewood Ranch and away from some of those areas, mostly because they had family in the area here, so it was a comfortable move. And then secondly, what we saw a fair amount of is, retirees, or folks that were maybe one to two years away from retirement and, were given sort of dispensation to carry out the rest of their years, working remotely. So we saw quite a few people who accelerated their home sales because of COVID. And again, those folks largely came from the Northeast and Mid-Atlantic areas and somewhat Chicago.
Dean Wehrli:
This is a hard question, but do you get a sense that you’re getting some extra retiree demand, even beyond those folks who are sort of newly enabled to cash out? In other words, because theoretically the retirees shouldn’t be impacted by that work from home consideration.
Laura Cole:
Correct.
Dean Wehrli:
Do you feel like there’s more going to even retirees who were already working quote unquote from home have increased their demand?
Laura Cole:
Like I said, I think we saw the folks that were near retirement. I think that’s what we’d been hearing a lot sort of, “Hey, look, we have one to two years left, maybe even three and our companies are saying, that’s fine and we’ll let you work from…”
Laura Cole:
Companies are saying, that’s fine and we’ll let you work from home until you reach that retirement age. And I think like everybody else, when we first came into the pandemic, I think everybody was really concerned about that retiree buyer. And I think most places around the country saw a delay in the active adult buyer coming back. We didn’t see that. We actually had a brand new active adult community that opened in March and has been performing at about 24 to 28 sales a month since they opened in March. So we saw something a little bit different here.
Dean Wehrli:
Yeah. I think there was a lot of folks concerned about that age qualified active adult market being hit hard. And we did see, I mean, California and Nevada, we did see some of that early on, but then it kind of bounced, it bounced back a little later, didn’t it?
Laura Cole:
It did, yeah.
Dean Wehrli:
It bounced back, yeah. How about marketing tactics? Was there anything specific that you did differently or better that was able to connect and draw some folks in?
Laura Cole:
Yeah, I mean I think luck has a lot to do with success and timing. And we spent 2019 completely restructuring our marketing effort, our whole marketing program and staffing, and everything else. So we actually restructured and closed down four information centers. We centralized it into one storefront on our main street, honestly, reshuffled all the deck in terms of our hiring, and focused on really moving our customer service online and on hiring people that were comfortable working with people online. And then, we built up our arsenal of tools, again, to be more responsive, especially folks who are buying from the northeast and moving to Florida, we’ve kind of bet on the fact that most people were going to continue to do more of their research online and that even potentially buy sight unseen. We really posited that in 2019 and got a lot of crazy stares.
Laura Cole:
But we’re really lucky because we had a completely … Again, we had an enthusiastic, very well talented group who was versed in dealing with customers online and we had implemented chat. We put in a new interactive map, which really helped us deal with one of our biggest issues, which is just our scale. We’re about the size of two Manhattans put together. And it’s always difficult to have people really sort of understand the scale, proximity to services and amenities, and things like that. And so, we invested very heavily before 2020 and putting all these tools in place. And we were lucky because I think it would’ve taken numerous years to get the customer, the consumer to really kind of catch up or to use those tools to their maximum. And what we had was a leapfrog event, right, where we had much quicker adoption. And so, again, being lucky really pays off, but I do think that those investments in technology, and we continue to do it to this day, are paying huge dividends for us.
Dean Wehrli:
Laura, you said luck or lucky at least four times in your answer. Take responsibility to say, “No, no, no. We saw something. We had a feeling in 2019.” Come on.
Laura Cole:
Well, I guess I’ll take a little bit with my team of … Because we got a lot of hits along the way and a lot of frowns as to why we were moving from a more in-person operation to this sort of online experience, but we’re certainly happy we did.
Dean Wehrli:
Yeah. How about just maintaining the lifestyle of your master plan of Lakewood Ranch during 2020 with all the COVID restrictions? Was that difficult? Did you do something different?
Laura Cole:
Yeah. Yeah, it was kind of difficult and, honestly, kind of exciting. We’re, again, really fortunate that we have really at the very top of our company, there is just this really deep, profound belief that lifestyle or what we call sort of the software of the community is our biggest differentiator and that we invest in it. We hired somebody a number of years ago, Monica Onstad, who was recognized nationally and she’s just a creative force. And she and her team kind of saw this as a cool challenge and went quickly, and they’re young and versed in online technology and social media and things like that. So they quickly were able to sort of pivot to online virtual events like a lot of people did.
Laura Cole:
And I think the important thing there was that when you kind of live and learn, right, I mean some were very successful, some were not successful, but the important thing was that we were there with our community in lockstep as they were experiencing this. And when we felt like we could move back to more in-person type of events and activities, we just had our annual camp out, we have our farmers’ market has been activated again, that we did it in a safe way, but you could sense when there was fatigue over virtual and how you really needed to adapt to some other type of activity. So I think that was really important.
Laura Cole:
And then one of the things is don’t let any of these type of situations go without thinking about innovation. And so during the last year, we launched an app, not only for folks to really get more connected with the community and be aware of everything that’s going on during the day, but also we really were focused on our local business community. And so we built a resident loyalty program to help our local businesses not only get visibility through this app, but also make sure that our residents really supported local business during this time.
Dean Wehrli:
How about in terms of safety … Master plans are just viewed as kind of more cohesive. Do you think that gives master plans a bit of an advantage against standalone entities without that cohesiveness? And maybe a bigger advantage, I should say, right?
Laura Cole:
Right. I have a kind of theory about master planned communities that just because of what they are, I think they tend to attract more rule followers. And I remember at one time being up in Houston and talking to the folks at the Woodlands, and they said, “Gosh, we thought we were going to get scientists. We really got a lot of engineers because they seem to migrate to master-planned communities.” But I do think master-planned communities, just because you really sort of control your boundaries a little bit better say than a jurisdiction or sort of loose federations of suburban neighborhoods, that there are practices that I think you can implement and that’s really viewed in terms of modeling behavior.
Laura Cole:
And so here, I mean I will tell you just in Florida, as you go throughout our community, if you go to the grocery store, I would say is very strong majority of people have masks on. When you get outside of the boundaries, things start looking a little different here. And I correlate that with probably master-planned communities, just in general, sort of the psychographics they attract I would say.
Dean Wehrli:
That’s interesting. So you’re less likely because of the nature of a master plan to get those kind of iconoclasts or those government ain’t gonna tell me what to do kind of a buyer than elsewhere. That’s a scientific term-
Laura Cole:
Yeah, I mean we have those, too.
Dean Wehrli:
Yeah. Well, you’re Florida so-
Laura Cole:
We still have those.
Dean Wehrli:
Yeah.
Laura Cole:
Right, exactly. But it is, to me, it was sort of a, I was like, gosh, it did seem like a stark difference being within the community, what we call the ranch or the bubble, and when you leave the ranch, what your experience is elsewhere.
Dean Wehrli:
So, I mean I think master plans have always had something of a premium over same home in a non master-planned environment. Do you think COVID has increased that, even above the folks it attracts, do you think that that premium has gone up a bit?
Laura Cole:
Yeah. I mean it’s hard in this environment, right, where pricing has really has gone up so much because of material cost, because of COVID, because of trying to deal with this intense demand, right, and a backlog of getting new lots and everything online. So there’s a lot of challenges that I think are pushing up pricing overall. And I think that’s going to have to get a little bit parsed out, but again, I think that because to some degree, a lot of these moves, going back to one of your first questions about, “Hey, did you see people leaving urban areas?” For those folks who are leaving urban areas that have good schools, that have good retail, that have a lot of services that are at their fingertips, and I feel like we’re kind of lucky because we’re 27 years into our master plan. So we have the sort of critical mass where people kind of can plug in.
Laura Cole:
And I think that’s just … I feel like the master-planned communities certainly have the ability to attract people who were more likely in some cases to be making emotional decisions. We’re going to be in a better place I think to get the price premiums.
Dean Wehrli:
So Lakewood, tell me if this is fair, Lakewood Ranch is one of those places where if you’re asked where you’d live, you say I live in Lakewood Ranch as opposed to I live in Sarasota. Is that-
Laura Cole:
Yeah.
Dean Wehrli:
You know, that destination?
Laura Cole:
I do. I think, yeah, and partially again, we’ve been around for a little while, but we’re between two counties, between Manatee County and Sarasota County. We’ve seen sort of the center of government and population gravitate out here. So I’d say sort of the center of gravity for both of those counties is actually moving in our direction. And so there’s a fair amount of brand equity around Lakewood Ranch and kind of a deep sense of community. And I do think it’s a lot of the software we talk about. That people, obviously, they come here, they’d send their kids to school. They may end up retiring here, but there is a deep sense of community and pride around the name of Lakewood Ranch.
Dean Wehrli:
I only knew Sarasota, by the way, because as a kid, because it was where the Pittsburgh Pirates had their spring training I think. Right? Isn’t it?
Laura Cole:
They’re still here.
Dean Wehrli:
They’re still there? Yeah. Okay-
Laura Cole:
Yeah. Oh, yeah, yeah. Yeah, they’re going to start, I think, next week, if not already.
Dean Wehrli:
Nice. Even though I was from Long Beach California, they’re my favorite team. Weird story, won’t tell it.
Laura Cole:
Yeah. I was like trying to make that connection in my head, but-
Dean Wehrli:
There is no connection. It’s weird. Have things been pretty good so far in ’21?
Laura Cole:
Yeah. So we have, I think I’ve talked to a number of colleagues around the country who are in the same boat, particularly the Sunbelt, I think MPCs, we didn’t see a slowdown in traffic activity or sales after the first of the year. And in fact, we’ve had week-over-week growth and not … I mean starting from the top, from website traffic to visitors on site to sales, and that I keep hearing the phrase, it’s a good problem to have. So this, what I call this sort of there’s a little bit of a pain point around really dealing with this heightened demand at this point from our builders. And I think they’re doing a terrific job of managing the inventory that they have. You’re seeing allocations now. And also really keeping customer expectations in check because there is going to be a period here where patience is going to be rewarded, but for those who have an expectation of coming, finding their perfect lot and perfect home within six months, I think it’s just going to take a little bit more time than that until we kind of work our way through this heightened period of demand.
Dean Wehrli:
Yeah. We’re hearing that all over the country. The biggest problem is getting the product and having inventory anywhere near completion, yeah. Let’s end with what has been kind of the most unique item or thing or factor about your master plan about Lakewood Ranch that really lets you stand out?
Laura Cole:
I guess I’ll go back, not to repeat, but I think it’s the lifestyle. Again, it’s just a really, most of the folks are uprooting from an area that they’ve lived in for a long time. They have family. They have favorite restaurants and things like that. And what I hear time and time again, and it really doesn’t matter if you’re a young couple or starting a new family or even retiring here that it’s an easy place to plug and play. And you’re going to find your affinity with a group here that likes doing what you do, that certainly takes advantage of all of the outdoor amenities and recreations that Lakewood Ranch offers. So I think the lifestyle really is the all-encompassing thing that I think drives people here and ultimately, makes them happy that they made that move and encourages them to bring family and friends to live here as well.
Dean Wehrli:
And no gators, that’s something. Oh, wait. Hold on. Gators?
Laura Cole:
Every pond, you should assume.
Dean Wehrli:
Gosh. Okay, wow. That’s why I don’t live in Florida.
Laura Cole:
When I came here from DC, this was explained to me and I think it’s a good rule to follow.
Dean Wehrli:
And now you’ve scared me again. Thank you. Actually, you know what, one more, one more, since you are the market psychic, what happens in 2022? Go!
Laura Cole:
Oh, man. I think we end this year stabilizing and I think that’s going to be, and when I say stabilizing, I think we start getting more to the demand drivers and the inventories that are going to be a little bit more leveled off. So I would say 2022 is going to look more like 2019.
Dean Wehrli:
Like ’19. I like that, ’22 like ’19. I’m quoting you. All right. Thank you, Laura, so much for coming on the podcast.
Laura Cole:
My pleasure.
Christen Johnson, Senior Vice President of Marketing at Johnson Development
Dean Wehrli:
Last up, but very much not least, we have Christen Johnson. She became Johnson Development’s Marketing Director in 2001 and is now the Senior Vice President of Marketing. She leads a team that handles the company’s marketing and outreach efforts, its image, its social media. She has been the Marketing Professional of the Year twice and is a member of the Urban Land Institute.
Dean Wehrli:
Now we have Christen Johnson from Johnson Development based in Texas. Christen, how are you doing this morning?
Christen Johnson:
Doing great. Thank you so much. Thank you for having me.
Dean Wehrli:
Absolutely. I’m not sure if it is because of or in spite of you guys being entirely in Texas, but you have four master plans that made our top 50 best-selling master plans for 2020. Pretty impressive.
Christen Johnson:
We do. We do. We’re very proud of that. Yes, Sienna, Cross Creek, Harvest Green and Trinity Falls
Dean Wehrli:
And three of those were in Houston, Sienna, Cross Creek and Harvest Green. And then one, Trinity Falls, is in Dallas, Texas.
Christen Johnson:
That’s correct. That’s one of our newer communities and we were very proud for it to make the list this year.
Dean Wehrli:
Yeah. No, it’s very impressive, honestly. Four, I think, is the second most from one developer so pat yourself on the back.
Christen Johnson:
Thank you. Thank you. More top selling communities than any other developer in Texas so I’m not going to lie, we’re very proud of that.
Dean Wehrli:
What has been your biggest driver, then, in sales for your master plans this past year plus?
Christen Johnson:
One of the things we pride ourselves on is our great amenity and lifestyle offerings that we have in our communities. We like to promote active lifestyles. So I do think that plays an important role in our communities in that people see the benefits of that. We have lifestyle directors that offer a year-round calendar of events and things to do for residents. And then, just being good stewards of the land. We take care of the communities and believe in the environment and sustainability. We’ve got a lot of great offerings as far as our trails and just ways that we give back both through the environment and then also through various things. We’ve got foundations that are collected at the closing of each home sale that go back in perpetuity for the communities for the benefit of residents.
Dean Wehrli:
Have you seen any pattern or trend this past year-plus of a certain buyer segment, a type of buyer that has been more active than they were before or has really fueled a lot of your demand?
Christen Johnson:
So well, as we all know, a lot of the millennial, the younger buyers are now entering into the home buying phase for a while now. So we’re doing a lot to appeal to them. And then also, we’ve got different segments throughout our communities, which is one of the things we’re proud of, different builder offerings and different price offerings. So we pretty much have something for everybody, whether you’re looking for a townhome, all the way to a luxury custom home. We’ve got something for everybody. And then we often find, too, in our communities that, especially communities that have been around for several years, that a lot of our buyers come from within the community. And so maybe they have a change in lifestyle or they’ve added more children or maybe they’re empty nesters. And so, we see a lot of our buyers coming from within our communities as well, which is a great testament to them appreciating what we’re offering.
Dean Wehrli:
Did your master plans get some of that or even a lot of that COVID-augmented demand from folks coming from maybe more urban areas or maybe more dense product into a little bit less dense product, a little bit more suburban location?
Christen Johnson:
Yes, absolutely. I think a silver lining of COVID was that a lot of firms as we saw successfully implemented the work-from-home strategies, which moving forward, I think we’re going to see more and more of that. So I think as people sat inside their homes and looked around and saw what was working or what wasn’t working, maybe they have kids that were doing schoolwork at home now or they needed more office space, I think that a lot of people just realized their current environment wasn’t working anymore. And then, of course, there’s a huge draw with the interest rates being so good.
Dean Wehrli:
Have you done anything to accommodate the work-from-home folks? Have you changed anything? Are you planning on changing anything?
Christen Johnson:
As far as floor plans or-
Dean Wehrli:
Yeah, floor plans or even maybe something in the amenity center or something in common spaces, too?
Christen Johnson:
So yes, we have actually, one of our greatest resources have been our branded community apps, which has allowed our residents to schedule classes and get directions to amenities, to parks and things, and so forth. And then also, we have a reservations system that our residents have been able to use. So they can actually make a reservation to go visit our fitness center or maybe the pools, different, just as we’ve needed to have safety measures brought in. So those apps have been real important for us over the past many months to allow us to keep functioning and for our residents to have as much use of our amenities as possible.
Dean Wehrli:
So you’ve adapted for your current residents. What have you done differently or what has worked better in terms of outreach and marketing to new buyers?
Christen Johnson:
Well, first of all, we have a great marketing team that is just an amazing group of marketing professional from all different ages and backgrounds. And so, between our teams, they’ve just done such a great job of appealing to different buyers we’ve got. We like to have a personal approach and then in appealing to those wide variety of ages and buyers, we often find that groups might like information provided to them in different ways. So, as an example, some of our younger prospects might want to see a video tour, a home walkthrough on TikTok, and we’re available there for that. And then, some other buyers might still like to touch and feel the brochures, except now we offer more in the form of like a lifestyle brochure or magazine, but mainly, one of the things is just to be sensitive to everybody and to offer a wide variety of ways for prospects to find us and to tour our model homes.
Christen Johnson:
And so a big way that we’ve done that is through video technology and allowing people to tour the homes without physically having to come out. Now if they want to do that, of course, they can. But we also offer online a lot of those tours there. And that’s important, too, because we see a lot of relocations, people coming from other states who might not be able to physically come out at that moment. And so, we like to offer, like I said, a variety of ways for people to tour our model homes and our communities.
Dean Wehrli:
Are you getting the sight unseen, sign a contract without ever coming kind of buyers ever?
Christen Johnson:
I have heard stories. I have heard stories also of people spending the night in their cars waiting for the specific home site that they want. So we heard stories about that going back years ago and I’m hearing them again. So it’s amazing, the demand that has been out there for new home construction. So we’re really pleased to see that of course.
Dean Wehrli:
So you mentioned you’ve been adapting with some scheduling and things like that to accommodate more people being on site and accommodate your residents. What have you done to make sure you maintain that livability in your master plan in this shelter in place environment?
Christen Johnson:
Well, I think that goes back to our lifestyle directors, the directors of fun as we like to call them. They offer the year-round calendar of events as I mentioned. And we’ve just been adaptable in how we appeal to people. Maybe instead of a giant event with hundreds of people, one of the things we’ve done is like drive-in movies or a food truck. And also, when we’re designing amenity spaces, we’ve started to look at more of food truck alley type of things where people can safely gather and visit a food truck and maybe hear a little bit of music and then, of course, things like virtual cooking classes and blood drives, things like that. So we’ve still been able to have people out and see the community and get a good feel and taste of the amenity offerings that we have in a safe environment.
Dean Wehrli:
Safety is a great word. Do you think that buyers and potential buyers view master plans as safer spaces right now compared to standalone or maybe infill locations?
Christen Johnson:
So I think one of the benefits we have as a master planned community developer and specifically at Johnson Development is that people can get out of those high density areas that they may be in, the more clustered areas of the city and come out to the suburbs and be closer to nature. So I do think there is an appeal for master planned communities right now just to utilize our trails. We’ve got miles and miles of trail systems, outdoors, open spaces. And even as the kids might be learning from home, they can go outside and have those, more area just to roam around. So I do think that there is a value there in the master planned communities and being out away from, like I said, those high density spaces. And then, of course, the community apps that I mentioned with the waivers for safety, we’re able to implement those and just our teams on the ground. A lot of our communities have HOAs on site and management teams so we’re able to respond to things very quickly.
Dean Wehrli:
Do you think that master plans, in part because of what you just said, are gaining kind of a bigger premium over like product in a non master plan setting relative to years past?
Christen Johnson:
I do, because I do think, like I said, there’s a perceived value and the value is very real of what you can get more of at a master planned community than maybe just a typical traditional neighborhood. And some of that is that master planned communities and at Johnson Development, we design them as a mixed use with spaces so that if you live there, you don’t even have to travel very far to get what you need. There’s shopping, there’s groceries, there’s dining and then in many cases, onsite schools right there in the community. Among the 19 communities that we have active today, I believe we have 31 onsite schools is the number that we’re at right now and they’re continually being added. So that’s a huge benefit that when you live in a master planned community, everything is pretty much just right there for you today.
Dean Wehrli:
Speaking of today, have things been going along just as well in ’21 as they were in 2020?
Christen Johnson:
I am pleased to report yes. 2020 broke all sales records, which is amazing because going back to April, we were not sure what was going to happen. I don’t think anybody was, but we had a year-over-year increase of 23%. And this year in 2021, it’s shaping up to be comparable to 2020. And as of right now, we are over projections so we’re very pleased with that and it speaks to a strong demand for new housing.
Dean Wehrli:
Let’s end with this, Christen. What is maybe the most unique or special kind of feature, pick any one or more of your master plans, that really sets you apart?
Christen Johnson:
Oh, wow. Just one?
Dean Wehrli:
No, you can do two, then. Do two.
Christen Johnson:
Okay. Well, I’ll just, got to speak from the heart here. So we, first, I might give you a few, but the variety of choices that we offer I think is huge. The variety, instead of just like one or two home builders, we handpick our builders, bring them in and so, they’re top notch and variety of housing types and prices. But I think the thing that’s so special about Johnson Development is just going back to how we’re good stewards of the land.
Christen Johnson:
And one of the things I love is, just to give you an example, is the art that we put in our communities. If you go to any of our communities, you’ll see we’ve got a giant chair and veranda, which is kind of fun. It’s interactive. You can take a picture with. We’ve got some quirky things like the Texas’ largest carrot in Harvest Green and also in Harvest Green, it’s really a wonderful feature because 70% of the landscaping is edible. So if you’re cooking dinner, you can literally walk outside and get some herbs and seasoning to put in your dinner. And so, we’re not just building communities for people to buy a house. This is a lifestyle that people can live for many, many years to come and make great friendships and enjoy all the offerings that we provide.
Dean Wehrli:
Wow. I love the edible landscape. Do you have turmeric? That’s the hot, whatever that is, hot seasoning right now. I’m just kidding.
Christen Johnson:
You know what? We might, we might.
Dean Wehrli:
Probably do.
Christen Johnson:
You’ll have to come out and try it.
Dean Wehrli:
Yeah, I’ll be focusing on the hops, culling your hops for you and brewing beer. I wish I knew how to brew beer. I do not. Thank you.
Christen Johnson:
You’re welcome to come out.
Dean Wehrli:
Thank you, Christen. That was very eye-opening and insightful. I appreciate you guys coming on.
Christen Johnson:
Well, thank you for having me. It was great visiting with you.
Dean Wehrli:
Awesome. Thank you so much.
Dean Wehrli:
This is Dean with a big shoutout and thanks to all the folks who participated in our two best-selling master plan episodes. You’re fantastic. Thanks again. Until next time, we’ll see you then.
