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Arizona HomebuilderJ U N E | J U LY 2 0 1 4

A CALL TO ACTION FOR DOWNTOWN PHOENIX

HOMEBUILDER SPOTLIGHT

INFILL COMPETITION HEATS UP

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-Bill Rogers, CEO of Homeowners Financial Group

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BILL ROGERSFounder & CEO of Homeowners Financial Group

Why do so many builders name HFG their preferred lender?“Homeowners Financial Group has been a great resource for many of our buyers who were turned down by other lenders.”

Jason Pancamo, VP of Sales & Marketing D.R. Horton

“Our buyers are always impressed and satisfied with the professionalism and overall service received by Homeowners Financial Group.”

Mark & Julie Hancock, Founders Camelot Homes

SERVICE LEVEL COMMITMENTS• All Builder Files Receive Initial 30-Day Underwriting

• Extended Locks up to 12-Months

• Customized Marketing Support

PORTFOLIO SELECT PRODUCTS• Expanded FHA and Conventional

• Clean Slate Program

• Construction Financing

Corporate Office | 16427 N. Scottsdale Rd. Suite #145 | Scottsdale, AZ 85254 | www.homeownersfg.com | 480.305.8550

All loan products and loan amounts may not be available in your area and are subject to credit and property approval pursuant to guidelines. Information is subject to change without prior notice. Other restrictions and limitations may apply. Homeowners Financial Group USA, LLC is licensed in AZ: Mortgage Bankers License No. BK 0906222, NMLS#93718; CA: Department of Business Oversight under the Finance Lenders Law License No. 603 F033; ID: Mortgage Broker/Lender License MBL-5879; NM: New Mexico Mortgage Loan Company License 03068; ND Money Broker License MB102538; OR Mortgage Lending License ML-5229

WA: Consumer Loan Company License CL-93718; MN: Residential Mortgage Originator License MN-MO-93718; MT: Mortgage Broker/Lender License 93718; NE: Mortgage Banker License NE93718 and registered in CO: Mortgage Company Registration.

Cambridge Properties Powers Sales of Luxury Urban Living Residences

Why Infill Now?

Cambridge Properties has been the sales and marketing engine for luxury home builders and developers in Phoenix for 20 years. Its approach, unique service, and vast understanding of the Phoenix metropolitan marketplace have enabled Cambridge Properties to sell more than $1 billion in new home lifestyle developments since 2001.

“Everything we do is about helping developers strengthen their market share across the Valley,” said Keith M. Mishkin, owner and founder of Cambridge Properties. “You Build…We Sell! We are the face of the

builder. Our agents — the developer’s sales force — are fully dedicated to them, but they are paid only when they produce closings. That means minimal capital outlay for the developer or builder and a huge incentive for us to move their residences.”

Cambridge Properties specializes in handling all the sales and marketing efforts for a builder. They provide all staffing, including salaries and benefits, for the entire sales function, from broker and sales manager to transaction coordinator and full-time sales professionals.

“We also can help a builder or developer assemble a first-class team of architects, interior designers, public relations and advertising agencies, appraisers, attorneys, lenders and title companies — everything they need to ensure their success,” Mishkin said.

By relying on Cambridge Properties to do what they do best — selling and marketing homes — builders can focus on their products, designs and community amenities to

build and consistently meet or exceed their sales goals — all while minimizing the cost and management of a sales force.

“We bring a tremendous amount of experience and insight, including my background as one of the top agents in town,” Mishkin said. “In fact three of the number one producers in the Valley over the past 12 years have joined the Cambridge team. Our agents and team members truly are among the top in the industry, and we do more developer representation than anyone else.”

From lofts to townhomes, single family homes to high rise luxury condominiums, Cambridge Properties is redefining what it means to live in Phoenix.

“We helped developers envision, plan and build more than 40 communities including Esplanade Place, Pinnacle Pointe, Montelucia, 3rd Avenue Lofts, The Open Collection at Litchfield Park and The Residences at 2211 Camelback. Developers come to us because we know the real estate trends and we have proven that our strategic sales and marketing techniques can help them achieve maximum pricing and sales velocity and net revenue to the builder.”

Cambridge Properties specializes in sales and marketing for high-rise luxury condominium communities, urban loft projects, upscale residential developments and condominium conversions. They also work with single family home builders, and have helped three different builders go from sales of just 20 homes per year to more than 500 homes per year.

“Our dedication, expertise, understanding of the local market dynamics and buyer’s needs have helped us increase sales and for numerous developers,” Mishkin said. “We let the builders build, and we sell. It’s a great formula for success.”

To say competition for infill sites has heated up among homebuilders would be the understatement of the first few months of this year. The niche space that has largely been reserved for smaller, specialized homebuilders is now the desired space for builders of all sizes. Why? It is one of the few places builders are finding sales success. It works today! Builders are struggling to convert sales in suburban and exurban locations while homebuyers are flocking to infill sites before they even open. Infill makes sense now, perhaps more than ever, in the metro Phoenix area.

Here is the reality in numbers. The average sales rate among all 446 active new home communities in the metro Phoenix area is a dismal 2.3 sales per month. This sales rate might be enough to fill the bellies of those few selling in the rarified air of $750K+ homes, but production homebuilders need more. In infill new home communities located inside the Loop 101, the average sales rate last month was 4.3 sales (per community).

From my perspective, two homebuilders can be credited with opening mid-size and larger builders’ eyes to infill potential: Meritage Homes and Trend Homes (now Ryland Homes). Meritage reopened its condominium project Madison Place in the Biltmore East Submarket in March 2013. The builder sold 34 homes, almost instantly. By early July, Meritage had sold all but three of its 61 homes.

Trend Homes had already been developing smaller infill sites in select markets and selling homes when Meritage came along, but because they were smaller sites bigger builders hadn’t noticed. Perhaps Meritage saw Trend’s success, and said, “Now is the time…”

Other builders have been successful. Porchlight Homes, Cachet Homes, Rosewood Homes, Garrett-Walker Homes, Green Street Communities — several success stories come to mind. The smaller guys that largely work in the shadows creating one-of-a-kind, fabulously-designed projects and product, the guys whose space has been invaded by mid-size and larger homebuilders, don’t get the credit they deserve, but they are a

large part of the story.

The infill revival is happening today because potential homebuyers in these locations have not seen new housing product for years (and years and years). The infill market shut down in late 2007. The price per square foot dove as lenders took assets back. Some of the assets came back to market as rental projects and others sold as distressed, low dollar homes. This product became stale. The new communities are drawing interest, a lot of interest, before they even open. Home-builders are reporting interest lists, driven off signage, in the hundreds before opening even occurs.

Infill buyers seek out unique and different, and the energy efficiencies that come along with new. I’m excited to see some of the new planned projects come to market — the Portland of the Parks, the Envy’s, even some of the smaller single-family detached and lower-density attached communities in which so much time and effort have been put into planning — because they hit infill buyers’ wants. We are fortunate enough to see these projects in the planning stages, and knowing the players, I know they are going to be great. Keep your eyes open. The next great infill project is being developed down the street!

Making Downtown Phoenix Happen Faster DAVID ALLISON Braun/Allison Inc.

I am not from Phoenix. That’s important to know before you read the rest of this article.

Not being from here, I had the usual preconceived notions about the city center; that it was very quiet, commercial, and struggling to build momentum.

Don’t get me wrong. I’m not a complete stranger. Our company worked on the One Lexington project in downtown Phoenix, and that’s when I first started to spend time here.

But one day recently a Phoenix-based colleague drove me around downtown, and my eyes kept getting wider and wider.

Everywhere I looked I saw signs that downtown is on the verge of an explosive period of growth and prosperity. I saw ‘green shoots’ of urban density that indicate a heroic revitalization is going on all around. This is not news to those of you who are involved. But to an outsider, it was revelatory.

So what’s next? How can we all help make this inevitable resurgence happen faster?

It’s clear we need to connect the green shoots into a lush garden. We need to help these pockets of urban density grow and prosper by filling in the spaces. The urban revitalization process in Phoenix is underway, and spreading the word to those who aren’t already involved can help make the process unfold more quickly.

Let me be more precise: we need people living downtown. And to make that happen, we need them to be excited about downtown living.

Game of shadowsMuch has changed since the last time people considered living in downtown Phoenix.

We have all lived through a monumental recession. If we haven’t lost our jobs or our homes, we know people who have. We have seen many promising condominium projects start, only to fail.

People are afraid because the shadow of the recession still looms, and this means they’re in no mood for life-changing decisions; decisions like moving downtown to live.

So how do we convince people it’s time to reconsider downtown living?

I believe there’s one small thing we can all do to help. We can start at the very beginning of whatever we are doing, each of us, and tell great stories.

Why do stories matter?Stories matter because human beings are tribal creatures. We all want to feel safe and comfortable, and being around people who are just like us helps generate that feeling. We all crave familiarity.

What creates familiarity and binds a tribe of people together are the stories we tell to each other. Stories are the currency of a relationship. We trade stories with each other, and we are no longer strangers.

So here’s the situation: revitalizing downtown Phoenix means attracting more people to live, work and play here. And it’s going to take all of us telling great stories about downtown to make that happen. If we all tell the downtown story, our combined voices will be too powerful to miss.

But before you can help spread the story of downtown, you need to have your own project story in place. Here are a few tips.

Controlling the conversationAfter a decade of doing this kind of work we’ve learned that creating your story can never come too soon. When you first start any project — a residential building, a new office tower, an infill development, a new civic structure — it’s important to have what we call a Foundation Story in place.

You need a Foundation Story from day one of your project because you want politicians, civic staff, consultants, planners, banks and investors to know what your story is. Everything we do, all of us, should start with a firm foundation.

A good Foundation Story is based on two things: in-depth knowledge about your end-users, and a clear understanding of the benefits of your site. Of course one obvious benefit of your site is that you are located downtown. Don’t underestimate how powerful this aspect of your Foundation Story can be. Leverage the amazing things already happening downtown to place your project in the middle of the revitalization going on around you. Craft a story that illuminates what you are trying to build; the downtown goal you have; your project vision.

By giving everyone a Foundation Story to share, you’re providing a map to where you’re headed. You’re controlling the conversation. And the conversation includes the downtown story that will help make your project a success.

What’s your plan? The next step is turning your Foundation Story into a plan-of-action, otherwise known as a Marketing Strategy.

This process should take a couple of months, as you must immerse yourself in all the variables that surround your project. Competition. Timing. Product. Sales. Promotion. Pricing. There are many complicated factors to consider, and many decisions to make.

Use your Foundation Story to help guide this process. As you make each decision about your Marketing Strategy, consider how that decision relates to your Foundation Story. Ask yourself if the decision will strengthen your Foundation Story, or is at least congruent with the Foundation Story you set at the beginning of your journey.

And when it comes time to execute your plan, your Foundation Story will help yet again.

Every public-facing tool you need: websites, brochures, a sales center, a robust signage program, mobile advertising, renderings, photography and etcetera; all should be based on your Foundation Story.

If you do this, if you begin with a Foundation Story that is shared by everyone involved and becomes the guide to help you make all your important decisions, you will have something your competitors don’t. You will have consistency.

You will have a building that looks and feels the way your audience wants it to look and feel. You have architecture, amenities, landscaping and interiors that all make each other stronger.

Help your own project by helping downtown PhoenixIf those of you who own or build projects in downtown Phoenix create a flood of unique and meaningful stories about your own projects, more people will understand that these projects are remarkable.

And part of being a remarkable project in downtown Phoenix is the remarkable downtown Phoenix story.

So, if we all tell great stories about our own projects, and in the process tell great stories about downtown too, we will have a groundswell of voices that can help change opinions. We can change how people think about downtown living.

And that’s a worthwhile goal for us all.

David Allison is the Founder and Creative Director of Vancouver-based Braun/Allison Inc., a real estate marketing and creative services firm. B/A specializes in creating plans and tools for building owners and developers to make residential and commercial real estate projects a success.

KEITH MISHKINBroker, CRS

Cambridge Properties

For additional insight call Jim Belfiore at 480.706.1002