HUD Allocates $54 Million to Alabama for Renovation, Repair

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On February 12, the U.S. Department of Housing and Urban Development awarded $54,561,426 to Alabama public housing authorities. State agencies will now be able to make major, large-scale improvements to those properties. The funding came through HUD’s Capital Fund Program, which annually funds more than 3,100 public housing authorities nationwide for building, repairing, renovating, and modernizing public housing. These state and regional housing authorities use the funding to replace roofs, upgrade plumbing and electrical systems, and make energy-efficient upgrades. Interested contractors should submit bids and proposals through the HUD portal.

The United States federal government has been investing billions of dollars for developing and maintaining public multifamily housing for more than 75 years. An average of 10,000 public housing units are lost yearly through disrepair and dilapidation. The Capital Needs in the Public Housing Program study HUD released in 2011 found that the 1.1 million housing units managed by state housing agencies require $25.6 billion in large-scale repairs to keep the units safe for residents. Capital needs differ from routine maintenance needs in that they are extensive and intensive repairs that are needed to make the housing decent and economically viable.

To protect the federal government’s enormous investment in public housing and respond to the ever-increasing need for affordable housing, the Obama administration proposed the Rental Assistance Demonstration strategy to complement the Capital Fund program. The strategy offers a long-term solution to revitalize the nation’s stock of affordable housing, by leveraging private and public monies to make critical improvements. Much of the money allocated to Alabama by HUD last week was generated through RAD.

Of the recent awards, HUD Secretary Julian Castro says that, “Every American deserves a place to call home where they can successfully raise their kids, enhance their financial security and build a better life. Through this funding, HUD is committed to strengthening our nation’s affordable housing units and to providing folks with the springboard they need to succeed.”

HUD Southeast Regional Administrator Ed Jennings, Jr.  concurs, adding that “HUD continues to look for ways to improve the quality of life for public housing residents. This funding will help housing authorities address long-standing capital improvements and preserve and enhance America’s affordable housing.”

Prattville’s Winchester Ridge Breaks Ground

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Montgomery, Alabama’s rural suburb, Prattville, is home to a luxurious new housing development that seamlessly marries urban convenience and country living. The developers of Winchester Ridge planned the development around the historic Booth family farm to preserve the land’s historical value and the local lore surrounding the house.

According to realtor Mugs Mullins, the fourth generation of the Booth family wanted to sell the 48-acre farm but they didn’t want the 260-year-old farmhouse to be demolished. According to Mullins, local legend says “that this same property was lost in the 1800s after the then-owner found himself on the losing end of a year-long poker game. If the walls could talk,” Mullins adds, “there is no telling what we could learn.” The historical intrigue surrounding the home lead developers to “incorporate this charming home into what is now Winchester Ridge,” instead of tearing it down.

Although it is only 3 minutes from downtown, the land is in a peaceful, rural part of Autauga County. The neighborhood has several lots available which vary in size, and enjoys limited pass-through traffic. There are currently 40 people living in Winchester Ridge, which has a private, residents-only common area with splash pool, playground, and picnic area. Pending approval by the neighborhood architectural review board, buyers can bring their own plans and builders to Winchester Ridge.

The homes are built by local home builders with unique styles. Although each home is unique, all homes share massive crown molding, wood floors, ceramic tile, granite countertops, contemporary fixtures, and richly appointed master suites with garden tubs and separate walk-in showers. The median home price is $262,000, with lot prices ranging from $34,000-$35,000. There are five homes with square footage ranging from 2,001-2,791 currently on offer, with seven build-ready lots available. Several homes are currently underway, with more to be built in 2015.

 

 

KB Home Intensifies Interest in San Antonio Market

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KB Home  has finally opened The Reserve at Southton Ranch in Bexar County, just south of downtown San Antonio past I-37. When completed, this master-planned neighborhood will add 128 new homes to the area.  KB Home is carefully developing the Southton Ranch subdivision to keep pace with the growth San Antonio’s petroleum industry has recently experienced. There are currently 268 homes occupied in Southton Ranch.

KB Homes believes that The Reserve will appeal to young professionals who want to live just south of Downtown along I-37, but want access to the major employers in Brooks City Base, and the Eagle Ford Shale cities of Floresville, Pleasanton, and Jourdanton. The Reserve offers 14 customizable, energy-efficient home designs ranging from 1,340 to 2,708 square feet with prices starting in the mid-$150,000’s. Brett Dietz, president of KB Home’s San Antonio division, says that “families who want an energy-efficient new home that feels like it is in the country but is actually only minutes from downtown San Antonio, The Reserve at Southton Ranch is the perfect choice.” He adds, “we’re expanding in response to the popularity of our prior phase at Southton Ranch by offering today’s homebuyers the chance to own a beautiful KB home at The Reserve at Southton Ranch.”

San Antonio has been enjoying record new home starts and home sales, but this success hasn’t reached south San Antonio—until now. Their development of Lago Vista off of Zarzamora Road made KB Home the first builder in five decades to build on the south side of the city. KB Home’s Villa Del Sol, Esperanza, and Vistas at Carmona Hills are also located on the south side. Braunig Lake, the San Antonio Mission Trails, the Mitchell Lake Audubon Center, Palo Alto College, and Texas A&M University-San Antonio are among the area offerings that KB Home believes will draw residents to these neighborhoods. It is hoped that KB Home’s residential development will spur economic investiture in south San Antonio.

KJIMS Homes Moves In to Naples and Marco Island Housing Market

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Sarasota’s KJIMS Homes is bringing their high-end luxury homes to Naples and Marco Island. KJIMS specializes in high-end homes and top-notch customer service. The company works to provide a seamless transition of services from the design phase all the way through to project completion.  The firm carefully studies each family’s lifestyle demands, and tastes before designing a home that is tailor-made to their preferences and needs.

Veteran builders Dan DiComo and Jon MacDonough bring their experience, focus, and hands-on philosophy to their luxury homebuilding business. DiComo is a decade-long resident of Marco Island with 30 years of industry experience in engineering, interior design, and architecture. He received his Bachelor of Architecture from the University of Michigan before beginning his own firm in 1993. DiComo, a member of the American Institute of Architects and the Florida Green Building Coalition, brings his design-build and project planning expertise to bear when collaborating with the clients and the design team. According to DiComo, his clients expect “the highest level of quality that can be delivered … That’s why we’re comfortable promising them to expect extraordinary with every detail.”

MacDonough got started in the building trades as a teenager growing up in Rhode Island. Working alongside New England master tradesmen helped MacDonough hone his skills as a builder and contractor. Upon relocating to Naples in 1989, he expanded into project management and entrepreneurship and eventually became a certified general contractor. This life experience of working his way up from tradesman to manager to business owner gives MacDonough a grounded and rounded approach to the construction process. “Our goal is to deliver a positive experience and high level of service throughout the relationship,” he says, “we take a personal approach that is intentionally different from the industry standard. Maximum quality materials and craftsmanship, as well as educating our clients throughout the process, is our focus.”

Long considered to be pricey upgrades by most builders, features like home automation, sustainable materials, and aesthetically placed outlets, fixtures, and registers are standard in KJIMS Homes. The firm’s signature Simonton design is currently being built as a spec home on Marco Island. The two-story, four-bedroom, 4.5-bath home features 5,360 square feet of living space, 10-foot pocket sliding glass doors between the indoor and outdoor living areas, covered balconies, a second-floor activity room/bar, a pool/spa, and a three-car garage. The firm is also working on several private residences in downtown Naples.

KJIMS Homes has offices in Naples at 1045 Crosspointe Drive, Suite 1; Marco Island at 1770 San Marco Road, Suite 205A; and Sarasota at 8141 Lakewood Main St., Suite 208, Lakewood Ranch.

Fannie Mae Embraces LEED for Multifamily Through Lower Interest Rates

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On February 6, the United States Green Building Council announced that Fannie Mae will reward green-built multifamily projects with a lower interest rate. The USGBC’s LEED rating system is one of several recognized certifications, with ENERGY STAR® and Enterprise’s Green Communities Criteria being among the others Fannie Mae considers eligible.

Green-certified multifamily properties will now be granted a 10 basis point reduction in the interest rate of a refinance, acquisition, or supplemental mortgage loan. If the market rate for a multifamily loan is currently 4%, then the new Fannie Mae program will drop that rate to 3.9%, for example. An owner will save $95,000 in interest payments over a 10-year term on any $10 million dollar loan they have which is amortized over 30 years.

United States Green Building Council CEO and founding chair Rick Fedrizzi says that, “This is a great demonstration of leadership from Fannie Mae, and the partnership between the multifamily finance industry and the green building industry.” Fedrizzi emphasizes that, “this is real money and an incentive to not only build green but also for existing buildings to achieve certification. For the first time, Fannie Mae multifamily lenders will be able to reward building owners for their better buildings.”

Fannie Mae’s executive vice president for multifamily Jeffrey Hayward echoes Fedrizzi’s enthusiasm. “Fannie Mae is leading the way in financing by offering new lower interest rates for green building certified multifamily properties,” he says, adding that “We clearly see the value in the triple-bottom line of certified green buildings: financial benefits of lower operating costs for owners and tenants; social benefits of better quality housing for renters; and environmental benefits for everyone.” Fannie Mae’s lenders “are ready with financing solutions to help multifamily owners make their properties more energy and water efficient for today and for the future.”

All loans financed by Fannie Mae under this lower interest rate will be securitized by Green MBS, a move that will grow the total volume of Green Bonds in the market which socially responsible investors can include in their portfolios. As the leading provider of multifamily financing in the U.S., Fannie Mae’s portfolio is valued at over $200 billion.

LEED buildings combine lower utility costs with higher energy and resource conservation metrics. LEED building occupants have more disposable income due to the energy savings, and the eco-conscious designs emphasizing non-toxic materials create healthier living environments. A U.S. Department of Energy report demonstrated that LEED buildings consume an average of 25% less energy, 11% less water, and have 19% lower maintenance costs, with 27% higher occupant satisfaction and 34% lower greenhouse gas emissions.

Home Buying and Wealth-Building: Is Equity Incentive Enough?

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In her depth exploration of the current housing market, Nancy Cook of The Atlantic recently asked whether home ownership is still the best way for Americans to build wealth. Her answer: yes, but less so than in previous decades. “Even if the rates of home ownership do return to their pre-bubble levels,” Cook explains, “experts and advocates acknowledge that home buying remains an imperfect crutch to boost wealth.”

Above and beyond building wealth through equity, home ownership affords many tangible benefits for buyers. Home ownership is still an important marker of stability and success in the American imagination. Homes for purchase tend to be located in better school districts and in better proximity to services than homes in rental neighborhoods. And the equity factor is still one of the best ways of building wealth for many Americans during this time of wage stagnation and pension shrinkage. As Brett Theodos, a senior research associate at the Urban Institute explains, “It is a forced-saving mechanism, and if you don’t have to think about saving, it goes better.”

This fact is part of why economists and politicos are worried that our housing market has failed to recover fully. Credit lending standards are so tight that anyone with the means but inadequately perfect credit still can’t get a home loan. The tight economy has stagnated the creation of new households, as people prefer to bunk with family and roommates to weather financial distress. First-time buyers, minorities, and Millennials are very under-represented in the current housing market. The impact of this situation on America’s economic future, and on the long-term financial wealth of those under-represented parties, remains to be seen but doesn’t look terribly good.

The Federal Housing Administration recently announced a plan to cut mortgage-insurance premiums, in a bid to nudge first-time buyers into the market. The plan will save homeowners about $900 annually on their mortgage payments. But even if home ownership rates return to pre-2008 levels, home buying is still only a means to prop up the acquisition of personal wealth. The 2000s saw record levels of Americans refinance their homes, pulling money out and using their house as a savings account, which has made housing less of a certain option for building long-term wealth. According to Theodos, the issue isn’t about home ownership as a perfect strategy, but rather, “What other vehicles are out there to help people build wealth over the course of their lifetimes and over generations? Private savings isn’t doing it.”

In order to recapture the full potential of home ownership to build wealth, Sarah Edelman of the Center for American Progress says that policymakers should take a two-plank approach to stimulating home ownership. “The majority of first-time home buyers may not be able to come up with a 20 percent down payment,” says Edelman, “for the future health of the housing market, we must make sure families who can afford to buy a home do.” New home ownership policies must acknowledge the value of home ownership as a way to build equity, and promote ways to help first-time buyers and renters save money for a down-payment on a home.

This would mean that private firms, civil agencies, and the federal government must experiment with new approaches. Creditworthiness should be measured in a much broader fashion than the current paradigm allows, programs that encourage automatic savings depots from earned income must be developed, and programs to help debt-ridden homeowners modify their mortgages as the housing market valuation changes should be a top priority. Equity-sharing programs for homes and apartments may also be a potential solution.

Until these issues are productively resolved, the housing market will not recover its full value, or its potential for wealth-building for the American people.

NDAA-Based Changes to Subcontracting Rule Will Affect Set-Asides

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At the end of December 2014, the Small Business Administration issued a proposed rule to implement provisions of 2013’s National Defense Authorization Act which require significant modifications to the subcontracting limitations for small business concerns. Specifically, the modifications concern the Limitations on Subcontracting Rule (13 C.F.R. 125.6). The proposed changes may leave small businesses having to rethink how they do business.

Currently, the Limitations on Subcontracting Rule limits how many subcontracting obligations prime contractors can relegate to outside entities, for example large companies that do not qualify for set-aside government contracts. The proposed rule suggests changes that would require companies to change how they determine subcontractor compliance, certify compliance in the bidding process, and impose serious fines for delinquencies.

As of now, the compliance ratios are based on the costs of the project and require the prime contractor to incur at least 50% of the cost and personnel expenses of each subcontractor’s part of the project. Section 125.6 provides different cost-based ratios to determine that 50% which are determined by the type of contract and type of set-aside.

The proposed rule would shift the calculations to an income-based metric. Prime contractors would be required to keep in-house a certain percentage of project income–including passive income–from set-aside contracts paid by the government. It would also limit distinctions based on the type of set-aside. Service and supply contracts would allow no more than 50% of contract income to be passed on to subcontractors. Construction would allow no more than 85%, and specialty trade would allow no more than 75% of income to be passed on.

There are two important exceptions to the proposed rule. The first is for “similarly situated entities.” Bearing in mind the philosophy behind the set-aside program, prime contractors will be allowed to contract out to companies who also qualify under the same set-aside category, but the financial considerations of that relationship would not be counted toward the income limit. But sub-contracts made with much larger entities that do not qualify for set-asides will still be counted toward the income limit. The second major exception is that the rule would not apply to contracts valued under $150,000, which smaller companies–that qualify for set-asides–are more likely to bid on.

Ultimately, this rule change closes a loophole under the current 125.6 rule that only accounts for the first prime-sub contractor relationship when assessing and accounting for all levels of a contractor’s subcontractor relationships. Presently, companies can get around the subcontractor limitation through sub-subcontracting out under the prime subcontractor. The new rule forces companies to address the new limitations in their contract bids for set-asides by: Certifying that they can satisfy the rule’s income conditions, identifying any similarly situated entities they plan to subcontract through, and noting what percentage they plan to subcontract to which entities. The contracting officer’s approval would be needed to make any post-award changes.

This new rule change would also impose steep penalties for failure to comply with the Limitations on Subcontracting Rule. Violators would be subject to “the greater of either $500,000 or the dollar amount spent in excess of the permitted levels for subcontracting.”

The Small Business Administration’s proposed changes may seem daunting to companies that have carefully structured their business relationships to be in compliance with current law. However, the changes will do much to ensure the future viability of the SBA’s set-aside programs. When smaller, disadvantaged prime contractors subcontract out the bulk of projects to large corporations, they are defeating the purpose of the set-aside structure.

The proposed changes are available for public comment through February 27, 2015. Comments on the Limitations on Subcontracting Rule section 125.6 may be made on the regulations.gov website.

Spring Home & Garden Show at The Woodlands!

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After a hard winter, we’re ready to see the latest home and garden trends, just in time for the Spring building season! The Woodlands, TX is holding their biannual Home & Garden Show on Saturday, March 7, from 9 a.m.-7 p.m. and Sunday, March 8, from 10 a.m.-6 p.m. The Show will be held at the Woodlands Waterway Marriott Hotel & Convention Center, on 1601 Lake Robbins Drive.

Event producer Tony Wood says that “Spring in The Woodlands is the perfect setting for our home improvement show,” adding that, “residents throughout the area have come to depend on us to introduce them to new products for their homes–inside and out–and for the 13th straight year that’s exactly what we intend to do.”

Domestic gourmets will be excited to see the trends in kitchen remodeling and renovation featured at the show. Wilsonart is sponsoring an extensive quartz countertop feature area, where they will debut their new quartz line of countertops alongside their traditional floor laminates and decorative surfaces.

New for 2015 is the Ferguson Kitchen & Bath Lighting Gallery Thermador Cooking Stage, featuring Chef Robbie, the expert on Thermador appliances. He will give four demonstrations each day, alternating between “Thermador’s Quick Weeknight Dinner from Start to Finish,” and “Sizzl’n Seafood in the Thermador Convection Steam Oven.” Molly Fowler, the Dining Diva, and Chef Austin Simmons of Hubbell & Hudson will share recipes and tips during their live-cooking demonstrations at the Cunningham Gas outdoor cooking stage.

Kohler is shaking things up a bit with this season’s show by bringing a mobile version of their testing lab from Wisconsin to Houston. Show visitors will be able to enter Kohler’s “Trust the Flush” custom motor coach and see for themselves how the company tests their toilets.

Perennial favorite Stewart Land Designs will be on hand to showcase 2015’s new landscaping trends. Creating unique and functional outdoor living spaces in a home’s natural environment is the company’s specialty. Show-goers who enjoy organic gardening should be sure to catch Nature’s Way Resources‘ In-Show Garden Center.

The Woodlands’ Spring Home and Garden Show tickets are $9 for adults, $8 for seniors, and free for children 12 & under. Free covered parking is available behind the convention center next to the Cynthia Woods Mitchell Pavilion at Six Pines and Lake Robbins. A skywalk will take pedestrians from the 4th floor of the parking garage to the hotel/convention center for the show. Follow the signs and take the escalator down to the show floor lobby and entrance.

For more information about the show, call 832-274-3944 or visit WoodlandsShows.com, where a downloadable discount coupon for $1 off admission is available.

Healthy Living a Luxury Amenity for New Miami Development

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With the upswing in WELL certifications and Universal-Access features, it was only a matter of time before developers realized that a healthy lifestyle could be also be a luxury amenity. Nicholas Nehmas of the Miami Herald reports that the new $200 million mixed-use development going up near Aventura mall is dedicated to healthy living. According to architect Bernard Zyscovich, “an active lifestyle is an attraction” that will make his Aventura ParkSquare project very sought-after.

Central to the development is the idea of a comfortably walkable community core. Instead of driving around or sitting in the air-conditioning, residents will be able to navigate the 7.5-acre community on spacious sidewalks that are shielded from rain and heat by a landscaped protective canopy. The walkways will not have curbs, which Zyscovich hopes will encourage joggers and strollers, walkers, and the wheelchair-bound, to roam free from the beaten path.

Integra Investments principal Victor Ballestas says, “we want people walking from location to location…Ultimately walkability is good for business.” Integra is one of the project’s development partners.

Consultant Dr. Karen Lee, formerly of the New York City Department of Health, specializes in public health consulting for urban planning. Public health-informed urban planning and architectural design has evolved into its own discipline: “active design.” When asked about the role of active design in the Aventura ParkSquare project, Dr. Lee explains that, “There’s now a strong base of evidence that when you design physical activity into your buildings and streets and neighborhoods, it can increase people’s physical activity.” As America’s current epidemics are obesity and diabetes, “creating healthy streets and neighborhoods can be an incredible tool for improving public health,” she says.

 The development will include Class-A office space, restaurants, retail shopping, a hotel, a small medical office, a residential tower with 131 units, and a senior living facility. The community will feature fitness studios, a roof-top pool, and an urban garden where residents can grow their own food. Inclusion of natural light in the wide stairwells and corridors will give residents “the option of walking comfortably instead of taking the elevator,” Zyscovich said. The residences range from 1,000 to 1,800 square feet in size, with a price range of $400k-$800k.

Located at the corner of 2900 Waterways Boulvard and Northeast 207th street, Aventura ParkSquare is expected to break ground during the first quarter of this year, and is slated for completion in early 2017.

Dallas’ Legacy West Mega-Development Breaks Ground Thursday

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The Legacy West mega-development will break ground tomorrow, according to Steven Brown of the Dallas News. This greatly anticipated project, a collaboration between Karahan Companies and Columbus Realty Partners, will occupy 34 acres at the intersection of the Dallas North Tollway and Legacy Drive. The development is just east of the site where Toyota Motor Corporation’s new $350 million North American headquarters will be built. The proximity of this high-density, mixed-use urban village was a key factor in Toyota’s decision to expand into the Legacy business park. The project is expected to create 1,500 commercial construction jobs over the next 18 months.

Developer Fehmi Karahan says that the Gensler–designed project is “going to build the project all at once,” with “about 280,000 square feet of retail and restaurant space and 621 apartment units initially.” Karahan adds that, “there will be about 240,000 square feet of offices over the retail space.” Karahan hopes “to have everything open in October of 2016.”

“There is a tremendous amount of interest,” said Karahan, whose  representatives with Open Realty Advisors have already begun the leasing process with several large retailers and restaurants.  Toyota will begin moving its 4,000 workers from Southern California into the nearby campus in 2017. It will be one of the largest domestic corporate relocations in American history.

Legacy West’s residential apartment section is headed by builders Robert Shaw and Roger Staubach of Columbus Realty Partners. The $82 million, 300-unit Renaissance Hotel will soon be underway at the northeast corner of Legacy and Headquarters drives. The 7 acres on the north side are slated to become either a condo tower or an office building. Alongside the commercial development, a 12-acre high-density private residential neighborhood will be built on the west side of Communications Drive next to J. C. Penney’s corporate campus. Plano’s BR Homebuilding Group has been tapped to construct this urban, single-family dwelling community. The Legacy West urban village has an estimated value of $400 million, according to Karahan.

The plans for Legacy West began soon after the outrageously successful launch of Legacy Town Center. In 2014, Karahan Companies and Columbus Realty reached an agreement with partners KDC and J.C. Penney to develop the vacant 240 acres surrounding the department store company’s West Plano headquarters. Soon thereafter, KDC had also signed on to build a new 265,000-square-foot headquarters for FedEx Office as part of the Legacy West project. An estimated 1,200 FedEx employees will move into the Legacy West apartments later this year. KDC is also building the Toyota project.