From sluggish to sizzling

April 21, 2006

When houses are selling like hotcakes, when sales staffs are writing two and three contracts a day, it's easy to forget about those residential communities that just never seem to get off the ground. Sales are slow. Home sites stand vacant. The people who do buy wonder if they'll ever have lots of neighbors.Cory Lake Isles is a case in point. Announced with much fanfare in the late 1990s, the 600-acre community seemed to have a lot going for it. It was off Bruce B. Downs Boulevard in the heart of fast-growing New Tampa. It was on what was billed as 'Florida's Largest Lake,' a 165-acre former borrow pit open for waterskiing and boating. The developer paved the streets with red-brick pavers and landscaped the community lavishly with canary date palms and flowering plants.But the community never caught fire. Everybody's got a theory about why. Maybe it was because initially it had no direct access to Bruce B. Downs Boulevard. It didn't feel like New Tampa. Until 2001, the only way in was via Morris Bridge Road, which felt way out there, practically Thonotosassa. Maybe it was the high lot prices and high Community Development District fees. Or the stiff competition from other communities with golf courses and attractive amenities.There were complaints, too, about the way the original developer ran the Community Development District and the homeowners association, and he battled with regulators over water quality issues.While subdivisions up and down Bruce B. Downs sold out - Hunter's Green, Arbor Greene, Tampa Palms - Cory Lake lingered. Various builders came and went and mostly went, most notably Toll Brothers, the nation's largest builder of luxury homes.Then in late 2003, Avatar Properties, a big developer-builder based in Coral Gables, bought more than 600 home sites at Cory Lake. There was speculation and skepticism in the building community: What did Avatar know that nobody else knew? Could it succeed where others had not?In its first full year of sales, Avatar sold 200 homes worth more than $78- million. As of April 12, it had sold all but 15 single-family homes, six of which are under reservation.Avatar claims to be 'investment- unfriendly,' requiring that investors who buy and flip rebate their profit to Avatar.How did Avatar do it?The company saw Cory Lake as 'a diamond in the rough,' said Bill Cowart, president of home builder operations. It had a unique land plan, that lake, a great location in New Tampa where everything around it was selling quickly in the best home building market in 20 years, with interest rates at historic lows. Avatar decided not to compete in the narrow $1- million piece of the market. Instead, they went after the bigger piece of the pie: the $300,000 to $700,000 segment that represents 60 percent of the market. Here's the playbook on what Avatar did to turn the community around, a combination of marketing strategy, architecture and the fine art of making lemonade:* It refreshed the community's appearance: the gates, the towers, the plantings. 'The original developer had a good idea with the brick-lined streets and the palms, but they were not connected to any true marketing plan," Cowart said. 'We asked: If this was a new community, how would we do it? We made the community look better from the outside. We wanted to make the people living there proud."* It acknowledged that most potential buyers these days work with buyer agents. (In Avatar's Central Florida communities, as many as eight of 10 buyers use an agent.) Avatar created an aggressive commission plan that rewarded not only individual agents but whole offices with higher commissions the more houses they sold at Cory Lake. Buyer agents 'are an asset, not a cost of doing business," Cowart said.At first it's those agents who bring in the buyers. The hope is that as time goes by, word of mouth and referrals by satisfied residents will generate buyers who purchase without brokers. Of the last 100 sales, Cowart said, close to 20 percent have come from referrals.* Avatar shuttled people to its award-winning communities in Central Florida (Bellalago and Solivita) to show what its finished products look like.* It made sure the exteriors of new homes looked like those of existing homes. Landscape packages, brick pavers and tile roofs look no different on a $300,000 home than they do on a home priced at $1- million-plus. 'You can't tell where they stopped and we started," Cowart said of previous builders. Avatar economized on interior finishes. 'Counter tops, tiles, interior specifications make the difference," he explained: for example, solid surface counter tops instead of granite. The proof of this strategy's success, Cowart said, is that many existing residents moved into Avatar homes and encouraged relatives to do the same.Jason Pithers, an agent with Coldwell Banker Tampa Real Estate Consultants, has sold 35 homes in three years at Cory Lake Isles. His current sales average in the mid $500,000s. Pithers is also a resident. 'Quite honestly, they saved Cory Lake to some extent," he said of Avatar. 'About 50 percent of the community was still vacant" when the company bought up the home sites. 'It was almost an unknown entity,' Pithers said. Many buyers thought of it as a million-dollar, high-end, custom-only development, which is how it was marketed originally. 'When more reasonably priced tract builders came in, it took off.' Windward Homes builds there now as well as Avatar.Some existing homeowners 'were slightly concerned we were going to be overrun with smaller plans than were originally offered, and the average home value and size would be reduced drastically," Pithers said. 'However, I think it became very clear very quickly from their sales that very few of the smaller products were ultimately bought. The majority are certainly larger." He agreed that, apart from slightly smaller home sites, the new homes are virtually indistinguishable from the old.'They highlighted the community, not just themselves," he said of Avatar, drawing traffic for other builders there as well. 'They put Cory Lake back on the map."This summer, Avatar will start building and selling 172 townhomes at Cory Lake Isles starting around $300,000. That should show whether the marketing magic continues. Judy Stark can be reached at (727) 893-8446 or .

SOURCE: St. Petersburg Times - St. Petersburg, Fla.