Editor’s note: The originally posted story incorrectly identified the project in which Collier Enterprises plans to sell properties around the $180,000 to $1 million mark and is leaning toward single-family homes there. The correct project is Sabal Bay. The story has been corrected below.
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NAPLES _ Southwest Florida developers are back in the permit game and preparing to sell new homes in one to five years.
They are getting ready to build after a four-year struggle brought on by the housing market crash.
Hacienda Lakes, a large development planned for Collier County, was approved recently by the Southwest Florida Regional Planning Council, which coordinates the planning of projects large enough to have a regional effect in its six-county territory.
Alico West, another large development, recently passed its comprehensive plan review by state and Lee County governments. The developer now is making plans for its Development of Regional Impact (DRI) application, said Donald Schrotenboer, president of Alico Land Development.
Two other large projects in Collier County, Sabal Bay and Big Cypress, both by Collier Enterprises, also are moving along.
Residential DRIs are development projects that consist of more than 2,000 units, which can include commercial buildings.
The re-emergence of DRIs is a change from 2007, 2008, 2009 and 2010. During that time period, some developers failed to make payments, went bankrupt and left projects.
“We were able to convince original land owners that took back land after the bankruptcy to take back the project and continue development,” said Daniel Trescott, planning manager for the regional planning council.
The regional planning council told land owners to keep going through the permit process because, once stopped, it is difficult to start again, Trescott said.
Land owners hung in there and now some are pairing up with developers. In 2010 there were no DRI applications but in 2011 three DRIs have restarted in Collier County, and a new one is on the way in Lee County.
Besides those projects, there are 23 DRIs at some stage of review, according to the regional planning council’s data. Reviews include assessments, post-assessments and amendments or notices of proposed changes.
Many landowners and developers are having portions of their projects approved instead of the whole property as in the past, regional council planning director David Hutchinson said. This method is less costly and offers more flexibility to respond to the housing market.
With the state of the housing market and economy, flexibility and preparation are key.
There aren’t too many large land tracts left, agreed David Torres, president of Hacienda Lakes LLC, and Pat Utter, vice president of real estate for Collier Enterprises. So they are staking out “attractive” territory near the coast to be ready for when consumer confidence returns.
Torres said he’s confident about the overall Naples market. At the end of 2009, Hacienda Lakes LLC took over the property development originally initiated in 2006 by Toll-Rattlesnake LLC.
Hacienda Lakes is planning for 1,760 homes and a variety of commercial buildings for retail, office and medical offices.
The site is near Collier Boulevard and I-75. It will be 2,260 acres with more than 1,500 acres left for preserve.
Hacienda Lakes is planning for 1,760 homes and a variety of commercial buildings for retail, office and medical offices, Torres said.
The site is near Collier Boulevard and I-75. It will be 2,260 acres with more than 1,500 acres left for preserve. Hacienda Lakes is currently using its own money to proceed, but plans to partner with a larger home-building firm in order to get access to larger capital.
Torres plans to start construction by summer 2012, once the developer gets through the extensive permitting process.
“We are positive but still concerned” about the immediate economic outlook, Utter said. “The national economy remains weak and the housing market is still bouncing along the bottom.”
Collier Enterprises is negotiating with the Florida Panther Protection Program to reach an environmental resolution regarding the Town of Big Cypress, planned for eastern Collier County. There will be 9,000 homes on 2,800 acres and 7,000 acres of preservation.
DRI permitting wouldn’t pick up again for two to three years and the development would go on for the next 12 to 15 years, Utter said.
Sabal Bay, also a Collier Enterprises project, will be south of Thomasson Drive in East Naples. Plans include 2,400 acres and 1,600 homes. The permitting process is expected to take a year to 18 months.
Utter said Collier Enterprises plans to sell properties around the $180,000 to $1 million mark and is leaning toward single-family homes.
Near FGCU and the airport, Alico West will cover 919 acres, including 355 acres of developable land.
The developer is planning for 1,950 dwelling units and up to 1.7 million square feet of commercial buildings,.
Schrotenboer of Alico Land Development said their growth is in conjunction with Florida Gulf Coast University’s growth in Estero. The region near Southwest Florida International Airport and university is showing some growth, he said.
The company is comfortable with the risk because it is counting on faculty and student housing needs as well as retail and a research-development park, he said.
“Overall in the marketplace I do not think we have hit a turning point yet,” Schrotenboer said.
He expects the market to continue to bounce around the bottom for now, but predicts an “uptick” in three to five years.
Alico West will cover 919 acres, including 355 acres of developable land. The company is planning for 1,950 dwelling units and up to 1.7 million square feet of commercial buildings, Schrotenboer said.
Eighty percent will be for multifamily homes, and Schrotenboer anticipates that planning will take more than two years.
“Shovel in the ground is over three years away,” Schrotenboer said.
Other developers, who built new homes in 2010, such as Lely Resort and Verona Walk, are benefiting from a housing market that doesn’t have enough new homes to keep up with demand.
During the housing market crash, developers stopped building, but now in 2011 real estate agents need new homes to sell, said Brenda Fioretti, president of the Naples Area Board of Realtors.
“Buyers in Florida still want new homes,” Fioretti said.
Claudine Leger-Wetzel, vice president of sales and market for Stock Development, Lely Resort’s developer, said the company has sold 170 new homes in Lee and Collier counties this year.
“Sales are up over last year across all products, Leger-Wetzel said.
The Lely Resort project still has five to seven years left of development, she said. The market has hit bottom but Stock Development feels there is opportunity ahead, she said. The company believes it is benefiting from its decision to move forward last year, Leger-Wetzel said.
Collier Enterprises is negotiating with the Florida Panther Protection Program to reach an environmental resolution regarding the Town of Big Cypress, planned for eastern Collier County.
There will be 9,000 homes on 2,800 acres and 7,000 acres of preservation.
The Naples Area Board of Realtors’ statistics back up what Stock Development is seeing. Currently, Collier County has less than 10 months of housing inventory left, which is actually two months short of what a normal housing market has, Fioretti said.
Twelve months is the norm, with equal amounts of homes bought as for sale. For the year ending May 31, 2011, there were 8,036 homes sold, but there are only 7,705 homes on the market, according to Naples Area Board of Realtors’ reports.
Homes on the market include new, resales, short sales and foreclosed. Short sales are when the mortgage company takes less for the home than it is worth as opposed to losing it to foreclosure. Short sales and foreclosed homes now make up 30 percent of real estate agents’ sales as opposed to 66 percent in 2010, Fioretti said. A normal market would have less than 10 percent of its sales be short sales and foreclosed properties, she said.
Overall home sales were up 4 percent in May 2011 compared to May 2010, according to a Naples Area Board of Realtors’ press release. This increase in sales is calculated from traditional home sales, not short sales or foreclosed properties, according to the press release.
These are all positive signs.
While developers still are being cautious, they are starting to “dip their toe in the water,” said Daniel DeLisi, a land-use planner for DeLisi Fitzgerald, who agreed there’s more residential building activity.
Sabal Bay, also a Collier Enterprises project, will be south of Thomasson Drive in East Naples.
Plans include 2,400 acres and 1,600 homes. The permitting process is expected to take a year to 18 months.
“A year ago that was the furthest thing from people’s minds,” he said.
Southwest Florida broker and housing expert Ross McIntosh said he “doesn’t think there is any risk of swamping inventory.”
Yes, foreclosures bring down the price of resale homes and resale homes bring down the price of new homes, he said. However, buyers of foreclosed properties and new homes are different.
New homes come with warranties and don’t entail as many complications as resale or distressed properties, Stock’s Leger-Wetzel said.
McIntosh agreed there is demand for new homes in Collier County — about 1,000 new homes a year based on census data, he said.
But a demand for 1,000 homes is sluggish, he said.
When the housing market relies on a number of variables — jobs, the stock market and consumer confidence — it is hard to predict the future, but McIntosh does think it is time to plan for two to three years out.
Developers also are adapting to new trends in residential development.
Trescott attended a workshop in which young people were asked what they looked for in a neighborhood or property. It turned out they were looking for modern developments that also met all their commercial needs. They weren’t looking for sprawled out areas like Golden Gate Estates or Cape Coral, Trescott said.
They wanted developments more like Ave Maria, Big Cypress and Hacienda Lakes that have housing, retail, office and commercial buildings all in one spot.