VOLUME 26 NUMBER 19 OCTOBER-DECEMBER 1996 RESIDENTIAL DAVIDSON, NORTH CAROLINA PROJECT TYPE

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1 VOLUME 26 NUMBER 19 OCTOBER-DECEMBER 1996 RESIDENTIAL McCONNELL AT DAVIDSON DAVIDSON, NORTH CAROLINA PROJECT TYPE A 202-unit, single-family detached neotraditional community developed by Davidson College to provide a mix of affordable housing for college faculty and staff and market rate housing for the general public. It incorporates outstanding design features, including historical exteriors and contemporary interior floorplans; various lot sizes; and a variety of purchase options and financing mechanisms. SPECIAL FEATURES Neotraditional design that emphasizes physical connection and stylistic similarity with the surrounding community Affordable housing financing mechanisms for college faculty and staff DEVELOPERS Davidson College Development Corporation Davidson, North Carolina Crosland Land Company Charlotte, North Carolina SITE PLANNER Brad Davis Land Design, Inc. Charlotte, North Carolina ARCHITECTS Emory Holroyd Charlotte, North Carolina James Wentling/Architects Philadelphia, Pennsylvania BUILDER Saussey Burbank Charlotte, North Carolina

2 GENERAL DESCRIPTION McConnell at Davidson is a 202-unit neotraditional residential community designed primarily to benefit buyers on the faculty and staff of Davidson College while accommodating those from the general public as well. The single-family community is located in the town of Davidson, one mile from the Davidson campus, in the upper tip of Mecklenburg County, North Carolina. The project offers housing of exceptional traditional design in a location that is convenient for college faculty and staff. A variety of creative financing mechanisms and design alternatives were devised to make housing as affordable as possible for college employees. To further subsidize employee housing costs, homes not purchased by Davidson employees are made available to the general public at market prices. A complex sales system ensures that college employees obtain the first choice of housing before homes are sold to the public. PLANNING AND DEVELOPMENT In 1991 the developer, Davidson College Development Corporation (DCDC), a subsidiary of the college, assembled a team including a professional developer, planner, architect, and builder. Crosland Land Company of Charlotte was the lead developer, charged with overseeing land development, house construction, and sales, on a fee basis. Rather than develop with a lot sales program and multiple builders, DCDC included Saussey-Burbank, a partnership between a custom builder and a production builder, on the team as a fee builder. James Wentling/Architects of Philadelphia, a noted practitioner of traditional neighborhood design, also was added to the team. In a unique approach, a focus group composed of Davidson College faculty was formed to develop a community concept acceptable to college employees and to achieve consensus on housing types and neighborhood design. Initial development goals included ensuring that both college faculty and administrative staff could afford homes and that homes would be of a traditional design that reflected the characteristics of historic Davidson's older neighborhoods. It was hoped that a mix of college employees and outside buyers could be accommodated. The site planners at Land Design, Inc., responded to the focus group's comments by devising a neighborhood plan of interconnected streets punctuated by several common green spaces. The most important element of the plan was the grid street network that scattered multiple entry points throughout McConnell to connect the new community with surrounding neighborhoods. An offsite sidewalk connection to Davidson's Main Street and the college campus was also built into the plan to reinforce the connection. The entrance signage typical of most subdivisions was deliberately omitted to signify that McConnell is part of Davidson, not a separate community. To introduce variety into the plan and to create less-expensive lots, lot widths along the streets varied from 65 to 80 to 95 feet. Lots were laid out to accommodate side-loaded, rear-loaded, or angled attached and detached garages. Alleys were not included in the plan, in order to provide green space at the rear of each home. Single-loaded streets, with homes on only one side, were planned where possible. To accommodate the focus group's concerns regarding preservation of an on-site four-acre lake, a four-acre area surrounding the lake was left undisturbed to provide sufficient buffer. The street pattern in the area of the lake deviated from the grid pattern to accommodate natural site contours. An existing dam on the lake was rebuilt and a spillway created. To connect the trail around the lake to the McConnell community, it was necessary to build the trail across the lake's headwaters, an area of wetlands. On-site mitigation measures included the construction of an underwater shelf approximately six to eight feet long, which provided the proper sunlight and depth of water for wetlands planting around the circumference of the lake. Due to the construction of the dam, upstream wetlands mitigation was necessary as well.

3 Several community greens provide open space. The largest green, located at the center of the site and planned to accommodate community activities, is named McConnell Green; it contains two arbors and two balustrade entries. Landscaping was planned around the exterior of the green to leave maximum room for children to play. The two smaller greens were planned to provide for passive uses and relief for the areas farthest from McConnell Green and the lake. Benches are included throughout, and a playground is located on common area near the lake. DESIGN The goal of the project team was to design homes that reflected the dominance of bungalows and farmhouses and of Victorian, Greek Revival, and Federal Georgian period styles in historic Davidson. The first step was to develop floorplans that met the lifestyle needs of the college and public buyers and then to adapt these to the styles of exterior architecture in Davidson. Certain floorplans were very popular, and to prevent the cookie-cutter sameness typical of suburban communities, several stylistic elevations of each facade were developed to achieve diversity and emulate the look of the historical community. By varying roof pitches, rooflines, window size and shape, porch design, entries, porticos, and materials, the same plan was made to look significantly different. More than 30 floorplans ranging from 1,500 square feet to 3,600 square feet and 90 elevations keep the project diverse. Two homes of the same plan cannot be within eyesight of each other unless the elevations are altered. Most traditional neighborhood design calls for garages to be removed from the front of the house and relocated to the side or the rear of the lot. Contemporary buyers want private, usable backyards that include patios or decks and show a strong demand for attached garages. Side-loaded garages angled toward the rear of the lot are one solution offered at McConnell. MARKETING A complex sales mechanism was developed to provide college employees with first choice of lots and also to preserve lots so that they will be available for later purchase by college employees. The initial marketing goal was to achieve a balance of 50 percent college buyers and 50 percent market buyers. After several years of actual marketing results, in January 1996 the goal was adjusted to a balance of 30 percent college buyers and 70 percent market buyers. A plan for an eight-year buildout in seven phases was adopted. Each section, each containing approximately 30 lots, was planned to open in September to coincide with the school year. College employees would have one month to examine their housing options. Following that, employees would have two weeks further to make a decision to execute a contract. After that time, half of the remaining lots were made available to the general public; the remainder stayed frozen until the end of the year. The number of lots frozen for college employees was later reduced to 30 percent to reflect actual demand. To maintain future availability and balance, the college reserves the right to purchase the frozen lots at the end of the year for a 10 percent discount. In 1995 the one-month examination period was reduced to ten days to streamline the process. FINANCING Several financing options were developed to assist college employees in purchasing housing. Under the downpayment and monthly payment assistance program, the college provided cash outlays, but the program could be used only in the context of fixed-rate financing. This approach was not competitive with existing mortgage markets, where adjustable rate mortgages provided lower house payments to buyers. Guarantees by the college to provide equity shortfalls for a fixed period of time over the 5 percent downpayment required from the college buyer were negotiated, enabling borrowers to qualify for conventional loans without the need for private mortgage insurance. The guarantee

4 is released once the equity requirement is reached. The most popular financing mechanism has been the ground lease. The college purchases the lot from DCDC and leases it to the buyer for a nominal amount. Two-thirds of the college buyer sales involve ground leases. The ground lease option reduces the purchase price by an average of about 18 percent. There also were design choices built into the process that improve affordability, such as the option to build homes smaller than the lot width dictates; that option was not available to public buyers. Many of the homes' features are included as options, giving buyers the opportunity to reduce the price by eliminating unwanted and perhaps expensive amenities. Restrictions on sale are a part of the financial incentive package in return for the college financial subsidies. The college retains the right of first refusal to repurchase homes for sale on the basis of an appraisal that the college obtains. If the college chooses not to repurchase the home, the owner can sell it on the market. EXPERIENCE GAINED Careful consultation with the target buyer, in this case the focus group composed of college faculty and staff, can provide the groundwork for a successful marketing effort and community. A variety of financing mechanisms such as ground leases, equity insurance, and direct subsidies can effectively reduce the cost of housing to employees. The ground lease program is the most successful mechanism by far and the most popular with college buyers. In addition, sales to public buyers provide income to the college that can assist in subsidizing housing costs with a minimum outlay by the college. Design solutions such as sprinkling smaller lots and smaller homes throughout the community and providing a basic design package with options for more expensive items can improve affordability without sacrificing the appeal of the community. Adjustments to orthodox neotraditional design principles may be necessary to meet the marketing parameters of the community, such as use of attached, front-loaded, or side-loaded garages rather than rear-loaded garages with alleys.

5 PROJECT DATA LAND USE INFORMATION Site Area: 99.6 acres Total Dwelling Units Planned: 202 Total Dwelling Units Completed: 83 Gross Density: 2 units per acre Average Net Density: 3 units per acre LAND USE PLAN Acres Percent of Site Detached residential Roads Common open space Dedicated right of way Greenway dedication RESIDENTIAL UNIT INFORMATION Unit Type Lot Size (square feet) Unit Size (square feet) Number of Units Built Range of Current Sales Prices Single-Family 9,750 1,468-2, $163, ,600 Single-Family 12,000 1,847-2, $181, ,300 Single-Family 14,250 2,736-3,697 4 $249, ,800 DEVELOPMENT COST INFORMATION Site Acquisition Cost $909,600 1 Site Improvement Costs Excavation/grading $649,000 Sewer/water/drainage 831,000 Paving/curbs/sidewalks 520,000 Landscaping/irrigation 565,000 Fees/general conditions 105,000 Total $3,579,600 Construction Costs 2 Superstructure $7,776,000 HVAC 540,019 Electrical 324,012

6 Plumbing/sprinklers 480,017 Finishes 1,836,066 Grading/landscaping/fees 3 1,044,037 Total $12,000,151 Soft Costs Architecture/engineering $323,000 Project management 4 200,000 Marketing 388,000 Legal/accounting/other 159,000 Insurance 5,000 Construction interest and fees 537,000 Total $1,612,000 Total Development Cost (to date): $17,191,751 Total Development Cost Expected at Buildout: $40,014,000 Notes: 1 Site acquisition cost is unusually low because the site was owned by Davidson College. 2 Included in the individual line items under construction cost is a development management fee, to date, of $585,000, which equates to 3.15 percent of fee simple revenue. 3 In addition to general conditions, included in this line item are builder fees of $566,859 to date, calculated at 4 percent of fee simple revenue, not cost. 4 Project management refers to a land development fee equivalent to 9 percent of engineering and land development cost. DEVELOPMENT SCHEDULE Site Purchased: October 1992 Planning Started: June 1991 Construction Started: March 1992 Sales Started: May 1992 First Closing: October 1992 Phase One Completed: July 1992 Project Completed: December 2000 DIRECTIONS From the Airport: Take Route 521 North to I-85 North to I-77 North. Take Exit 28 and turn right on Griffith Street. Turn right on Main Street, then left on Davidson-Concord Road. Proceed one mile and turn left on North Kimberly Drive. Information center is at 101 North Kimberly Drive. Driving Time: Approximately 25 minutes in non-peak-hour traffic. The Project Reference File is intended as a resource tool for use by the subscribers in improving the quality of future projects. Data contained herein were made available by the Development team and constitute a report on, not an endorsement of, the project by ULI - The Urban Land Institute.

7 Copyright 1996, 1997, by ULI - the Urban Land Institute 1025 Thomas Jefferson Street, N.W. Ste. 500w, Washington, D. C

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