Inland Real Estate Development's Strategies Save Builders Time & Money
In the ever-changing business world, new strategies are always needed to help increase a company's profits and keep it at the competitive edge. Over the past decade, numerous corporations that saw their profits dwindling embarked on drastic downsizing.
Inland Real Estate Development Corporation (IRED) however, has found the formula for a successful foundation by anticipating change and tailoring services accordingly. It is a formula IRED incorporates when selling land to home builders throughout the Chicagoland area. IRED saves home builders regardless of size, time and money, through its innovative land development strategies. These strategies help home builders stay competitive in a fast-changing market.
"We have approximately 10,000 acres of land that totals more that 70 parcels in the Chicagoland area and more than 20 residential developments in various stages of competition," said Tony Casaccio, president of IRED, a subsidiary of The Inland Group, Inc. in Oak Brook. "We are the only land banker/developer in Illinois that offers home builders everything needed in the development process, from land acquisition through development and sale of finished lots."
Casaccio added, "We pride ourselves on our ability to get things done-efficiently and productively. This is how we save builders time and money. This is the formula for our success and the success of the home builders doing business with us. We are dedicated to doing whatever it takes to help make it easier for our home builders to sell their homes.We invest our money, our time and our expertise inland development as well as marketing the communities that we develop. Our formula gives home builders the opportunity to build in different markets with a minimal amount of invested capital."
Inland has been banking its land holdings for a number of years through three public limited partnerships formed by an affiliate of IRED. The partnerships paid cash for undeveloped land in Chicago's growing suburban counties including Kane, Kendall, Lake, McHenry and WIll. Because the investment partnerships own the land for cash, IRED is able to structure creative land financing for builders. "Builders can lock in their land costs with us and avoid worrying about wild interest rates," said Matt Fiascone, vice president of IRED. "We want all parties to walk away from the transaction satisfied. With nearly 10,000 acres of land available for sale, we're looking to build strong working relationship with reliable builders who will be repeat customers."
Owning the land free and clear is what gives inland its dominance in the Chicago suburban area. "This financial position gives us the the flexibility to change gears and respond to market conditions quickly," said Casaccio."We can select a site with the builder, get the land zoned and subdivided and install the improvements to match the builders to pick and choose which areas they want to build in or at what point they want to join in a project. We are able to cut one to three years off the development process for builders, saving both time and money. Inland can also help narrow the potential sites by area, type or size. After analyzing the builder's needs, we can sell individual lots, sell groups of lots on a take-out basis, divide the parcel or sell the entire tract."
Signature Communities IRED's Value-Added Properties
With Inland owning such vast amounts of property, IRED can expedite the sale of the land with strong marketing strategies that benefit a home builder to the large production builder. According to Rich Artman, director of marketing for IRED, "One of our strategies is to offer finished lots in well-planned communities. We want to make it as easy as possible for a home builder to buy our lots. We offer strong marketing support so that the home in our subdivisions sell quickly. We want our builders to do well in our developments, so we're continuously working on new ideas to help them succeed."
IRED realized that in order to quickly sell their land, they had to develop and create lifestyle communities that meet the needs of today's sophisticated home buyers. Using extensive research, IRED studied each market segment and then designed creative environments to fit these needs from entry level to high-end homes.
Inland calls its value-added properties "Signature Communities." The properties are symbolic of the high quality of service and business standards Inland has been known for throughout its 30 years in business. To a home builder, this mean that a Signature Community will involve Inland in every step of the development process, except for the actual building of homes. Artman added, "In the case of the large production builders, we can lend assistance to any marketing program they have in place. Inland also has other property in the areas surrounding our developments that we utilize for off-site signage; and we have long-term leases with billboard companies in prime locations that give our home builders an excellent marketing window in these areas."
"Marketing is the icing on the cake," he continued. "A small custom home builder can construct a spec home and put up a For Sale sign and never have to do another thing." Inland's advertising efforts are designed to draw traffic to the site. Marketing is another value-added aspect of buying into any of Inland's Signature Communities.
Another marketing tool offered is the Multiple Listing Service. Inland will list any builder's spec home for a nominal fee. When the house sells, a sales commission is paid to the cooperating broker, creating a win/win situation for both the builder and developer.
Creating Innovative Lifestyle Environments
Innovation and visions for the future are the factors that keep Inland's Signature Communities on the success track. We have so much land, we must continuously develop creative ideas on how to market and sell it," said Casaccio. One of IRED's forward thinking concepts is creating a Traditional Neighborhood Development (TND). Even though the TND concept is becoming popular in other parts of the country, Inland's Oswego Village Square in Kendall County will be the first of its kind in the Midwest.
After extensive research and over two tears in the zoning process, Inland knows that market is ready and the time is right!
Oswego Village Square will be the first true 'non-hybrid' Neo-Traditional development in the area. It will include intermixed housing ranging from townhomes to entry level and upscale homes. The homes will resemble homes built in older, more established neighborhoods. These homes will be near a town square, parks, greenery and pedestrian access to a main street. Inland is targeting a lifestyle rather than an individual buyer.
"TNDs are designed for people who want the old-fashioned neighborhoods back; where neighbors mingle and where they can walk to parks, convenience stores and school and not be dependent on a car, " said Fiascone.
All of the homes will have front porches, adding to the usable living space and offering friendlier, people-oriented curb appeal. Not a single garage will be visible from the street because garages will be attached at the rear of the houses, accessible by privately-maintained alleys. The TND concept moves away from the sprawl of the conventional Planned Unit Development (PUD) with its large lots, garage dominating front-elevations, isolated backyards, cul-de-sacs and total dependency on the automobile. Instead of pushing homes farther apart with deep setbacks from the street and sidewalks and an accent on backyards, a TND brings homes closer together while preserving open space in parks. It is the same way cities and towns were once designed, which is why tear downs and replacements in many older communities are so popular today.
According to Fiascone, "Most new subdivisions are not designed with 'community' in mind. In a TND you have an instant community."
Lots at Oswego Village Square range in size from 5,000 to 10,000 square feet with at least 10 to 12 feet between each house. Accordingly, homes will be designed narrower and deeper than most new production homes that are more boxy in shape. "Even though the lots are smaller, the space between the homes is similar to the space between typical homes on average-sized lots," explained Fiascone. And placing the garage at the back of the home allows the same ample space between homes even though lots are smaller. "Many of us at Inland grew up in Chicago neighborhoods," said Casaccio. "These were great places to live, raise children, or just to be a kid. Neighbors knew each other and they watched out for each other's kids. There's no reason we can't have that today. People want a sense of community, they want to put down roots, they want to be a part of a place."
"We're going to be with this project from start to finish," added Fiascone. "We're controlling the end product through covenants and restrictions and architectural design standards. The response we're getting from the building community has been outstanding. Everyone we talk to is interested and they usually want to hear more about our Neo-Traditional designs." Sundance Homes was eager to be a part of Oswego Village Square. It has purchased 75 lots and took possession the first of the year. Models should be finished by May.
If Inlands' first development in Oswego, The Ponds At Mill Race Creek, is any indication of accurate marketing strategies, Oswego Village Square should be a success.
The Ponds At Mill Race Creek is another Inland Signature Community, consisting of 243 single-family homes and 126 townhomes. Every single-family lot has been sold to Kimball Hill Homes and Hoffman Homes while Lord & Essex purchased all of the townhome units. "This development is beautiful and unique because we created extensive water features on the site that allow for fishing and boating from the homeowners' backyards. We won a Silver Key award from the Chicagoland Homebuilders Association for outstanding design," said Artman.
A rill system stream of fresh circulating water which meanders the perimeter of the property complements a system of lakes, ponds and dramatic waterfalls. Each lot looks out over a water feature offering dramatic landscaping features for every home. According to Inland, the competition for these lots was fierce among builders.
IRED has other large tracts of land which are in the planning stages including a 1,500-unit, 750-acre project in Huntley, northwest of Chicago. Huntley, a fast growing town, is the site of the new Huntley Factory Shops regional outlet mall. IRED's multi-use, master-planned community will accommodate everything from retail/manufacturing to single-family homes. "This is the next frontier," said Casaccio. "We're in active discussions with two builders for 300 units and looking for other builders who would like to work with us on taking down some of the remaining units."
"Other builders simply can not get into this market now because there isn't a sewer facility in the area," added Fiascone. Because of this, Inland is creating a sewage facility at a remote location to accommodate growth in this area. They are using a waste water reuse system, an environmentally sensitive system that treats the sewage and reuses the water rather than discharging it into a stream."
Other Inland developments in the planning stage include:
The Bottom Line...Saving Builders Time and Money
"Historically, Chicago has been one of the few markets that sees the same person or company playing the role of builder/developer," said Casaccio. In most area, a builder goes to a developer for finished lots. In Chicago, The mindset of many builders is that they can save or make money by developing the property themselves. In fact, Builders are losing two to four years in time trying to get annexation and zoning approvals, not to mention the time spent actually developing the sites. Inland has a good working relationship with the communities in which it develops and our year of experience help speed up the process. That means a builder can be in two markets at once with very little capital at risk. Inland is financially strong and able to carry a project through for builders.
"We're flexible as to terms. A builder can buy 10 to 15 lots at a time and we'll carry the remainder for them. That's fine with us." stated Casaccio. "Any type of help we can give our builders is money in their pockets. We give them tine, so when they sell their homes we all make money.
To learn more about land Inland has for sale, call 630-954-5677.
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