Past the stone gate of Chandler Point, Burnside Street rises into the pastoral hills of Rural Hall. It is joined by other roads with bucolic names like Aurora Glen Drive and Whisperwood Street to make the groundwork of a model suburban community. There are sidewalks, streetlights, walking trails and, below ground, sewers and wires. The only things missing are homes. Except for a cluster of 10 houses at the northwest corner of the development, Chandler Point is a ghost town. The 400-acre property has lain fallow since the July foreclosure of its builder, Pierce Homes of Greensboro. As the property shuffled between banks and developers — most recently to the
Danville, Va.-based American National Bank & Trust — the land and its few residents have been neglected. Vacant lots grow tall with grass and mud runoff fills the streets. Graffiti and empty beer cans are evidence that delinquents have been gathering at the unfinished 11 th house. Residents fear that their home values will be undermined by the area’s neglect, or worse, by future development of low-quality homes. But with little communication from the varying owners of Chandler Point and scarce acknowledgement from the town of Rural Hall, the residents remain disappointed, frustrated and bewildered.
“I just kept thinking it wasn’t right,” said Sandy Robertson, who purchased her home at Chandler
Point in March 2008. Although initially impressed with the development, Robertson became concerned as construction slowed over the summer. Then it stopped. One day a carpenter who was repairing her bathroom floor left mid-job after receiving a phone call. Soon afterwards there was a letter from Pierce Homes announcing the foreclosure and apologizing for any inconvenience. Since July Robertson has had to pay out of pocket for repairs to her home, which was under a oneyear warranty. And she is still waiting for the completion of planned community amenities like hiking trails and a swimming pool.
“Now I’m just like,
whatever. It’s not like I can up and move,” Robertson said. “No matter
what I still have to pay the mortgage.”
The six families of
Chandler Point (four of the houses are vacant) are stuck in residential
limbo, a strange phenomenon born from recent hard times. As with many
new neighborhoods, the homes do not exist on Google Maps, nor on
Forsyth County’s Geo Data software. This posed a problem when residents
tried to alert police about vandalism to some of the vacant homes.
“I had to go out and show them where we were. The police didn’t even know we were here,” said Jim Barclift, who relocated from New Jersey
last year. A retiree, Barclift devotes his time to looking after the
neighborhood. He walks around the development daily in an effort to
protect against theft and vandalism. He also shares with other
residents whatever information he can find about Chandler Point. He has
uncovered blueprints and contractor records, but so far little about
the development’s future.
Chandler
Point is caught in the gears of a rapidly decelerating real-estate
industry. New residential construction is on hold across the country,
as realtors work through a surplus of new and foreclosed homes, and
banks withhold risky loans from buyers and builders. With little demand
for new homes, the proprietor of Chandler Point has scarce reason to
build. Therefore it may be months or years before anyone completes the
roads of Chandler Point, roads which end in piles of gravel, or mows
the lots of chesthigh grass, or ever converts the chasmic concrete pit
into a swimming pool. Fortunately, the case of Chandler Point is an
extreme in the Triad. Foreclosed developments are more typical of
supercharged markets like Phoenix, Ariz.; Tampa, Fla. and even
Charlotte, where there was a higher surplus of homes and a greater
decline in property values. But throughout the Triad there is evidence
of a floundering industry. While plans for new projects have
evaporated, developments which began recently now languish. To avoid
bankruptcy or foreclosure, builders and developers have no choice but to keep building — slowly — and hope that the market will rebound.
One
site of slow construction is at the Staffordshire Townhomes on New
Garden Road in Greensboro, which began development last year. When the
real estate market crashed, local builder Dalton Worthington quickly
scaled back the pace of construction.
“I didn’t have anything
finished, thank God, because a finished home just sits there costing
money daily,” Worthington said. “Now we really haven’t been in a
hurry.”
Construction continues on one of the Staffordshire
townhomes, which will be used as a model home. The rest of the
lake-side development is inactive — nothing but roads and empty lots.
Billboards at the front of the neighborhood seem either optimistic or
desperate. One reads: “Don’t Miss The Opportunity To Customize Your
Home!” Another celebrates Staffordshire’s first — and only — two
residents, Mildred and Maribell, which are two swans that live in the
lake. Although Worthington will lose money from the “ticking interest
payments” on the development, he is confident that his company,
Worth-Reitt Associates LLC, can hold onto the property. It helps that
his company has few houses on the ground, as houses incur much higher
taxes than vacant lots. It also helps that his company has money in
reserve and a manageable amount of land holdings. But he’s still
praying for a market rebound.
“We’re going to finish one model
home in sixty to ninety days. If there aren’t any buyers in about
ninety days, I’ll be a little more concerned,” Worthington said. Two
more delayed developments sit by the old Grandview Golf Course in
Pfafftown. One of them, Grandview, is in construction on the site of
the golf course, which was sold to Jade Associates in the summer of
2007. Since demolishing the course, however, the local company has made
few improvements to the property beyond several segments of road and
piping. Otherwise, the old golf course is a wasteland, scattered with
sleeping bulldozers.
“If someone were ready to buy lots, we
could have them ready really quickly,” said Jade Associates partner
Allan Jones. “But we don’t expect that to happen until spring.”
Jones’s estimate is far behind the timetable he gave in an interview with The Business Journal in
July of 2007, in which he spoke of having homes on the ground by spring
of 2008. On the other side of the road at Grandview Crossing,
construction is a few stages further along. The 71-lot development xxx was
purchased by Salem Ventures LLC in the spring of 2007. It has roads,
piping and streetlights, but only a few homes are under construction.
The
rest of the development looks like a bizarre go-kart track. Ironically,
many of its street names reference the now-absent golf course, such as
Fairway Run Drive.
Here, too, developers offer a revised
timetable. “[Grandview Crossing] would take four to five years in a
good market,” said Prudential branch manager Butch Ray. “Now it could
be more in the range of six to seven years before it’s totally built
out.” While some developers face delays, others have consolidated loses
by selling property. Sellers include regional and national builders
that are quitting the Triad area, like CP Morgan and Centex.
Their
unfinished neighborhoods have been purchased at discounted rates by
builders with financial backing. In many cases they have been bought by
local builders, such as Wade Jurney Homes, Arvista Homes LLC and D.
Stone Builders Inc. Because of this trend, the long-term effect of the
real estate slump may be beneficial to the area. After all, land and
homes will eventually be valuable for whoever can hold them. Property
value can be jeopardized, however, by foreclosure. Case in point is at
Chandler Point, where the development has been entangled in foreclosure
proceedings for many months. The property was also hamstrung with liens
placed by unpaid contractors — part of more than 80 lawsuits against
Pierce Homes.
Another development which faced a disastrous
foreclosure was Park Ridge Pointe off Country Club Road in
Winston-Salem. An innovative project for a tight cluster of luxury
eco-villas, the unfinished cul de sac has long been a jumble of
cobblestones and construction equipment, European-style balconies and
torn-up lawns. The centerpiece is an incomplete brick water fountain,
and on the road beside it is a permanent 12-foot puddle due to improper
grading.
“I’ve lived in a construction site for over a year
now,” said Tracy Murphy, who closed on her home in November 2007. Since
the foreclosure of developer Green Pointe Properties LLC last winter,
the property remains unfinished and many contractors have not been
paid. Residents and workers have had few opportunities for recovering
lost money, beyond levying new lawsuits against the developer.
Meanwhile,
at the time of foreclosure, Green Pointe President Jim Jackson was
already in jail on unrelated felony charges of passing bad checks.
It
is not surprising that homeowners should resent the foreclosure of
their developer. But at Park Ridge Pointe there is a litany of
complaints that go far beyond economic mismanagement. Many complaints
are against Jackson personally, who masterminded the start-up company
through which people, businesses and banks lost money. No one is more
resentful than Jackson’s former partner, Patrick Kinney, and Kinney’s
girlfriend, Judy Barbour, an early investor. Since their legal
separation from the company in 2007, Kinney and Barbour have devoted
long hours to investigating and tracking Jackson. Kinney and Barbour
have contacted lawyers and prosecutors in the hopes of bringing Jackson
to court for what they call decades of shady dealings and scam artistry
— mostly involving realestate developments.
As Kinney
describes it, the story of Green Pointe Properties LLC is a scandal in
the veins of investment-scammer Bernard Madoff. Kinney claims that by
charming investors and throwing around money Jackson was able to
generate interest and investments in Park Ridge Pointe. This included a
multi-million dollar loan from Bank of Granite. Investments and loans
continued to pour into the development, despite a limping pace of
construction.
Then all of a sudden, Green Point Properties LLC
ran out of money.
Jim Jackson was unavailable for comment.
Blame
management or blame the economy. But whatever Jackson’s intentions, his
extraordinary success and later failure expose the reckless optimism of
an industry. For a time there was near limitless money available for
new developments, especially those involving buzz phrases like “green
architecture.”
Even Kinney admits that Park Ridge Pointe was a
winning idea. “Bank of Granite saw the possibility of the project. And
it was a good project,” he said.
Since last spring’s auction of Park
Ridge Pointe to local developer Randy Duggins, residents are hopeful
that the development will finally be finished.
“I want to see
the new developer be successful, because if he is successful with the
project we are all successful,” Murphy said.
Despite widespread
economic trouble, production continues at a moderate rate on many
developments. The success of these projects depends on cooperation
between all levels of the real estate industry. Banks, builders and
developers are writing and revising contracts to prevent any leg of
their development from breaking.
Cooperation has been central to progress at the Brookberry Farms neighborhood off Meadowlark Road in Winston-Salem. Developer
Jim McChesney is working with 20 builders in the production of nearly a
thousand mid-range to luxury homes at the 800-acre development.
Recently, McChesney has allowed some builders to take down fewer lots
than required by contract. The developer’s leniency helps keep builders
out of bankruptcy — an act of goodwill, but also of business acumen.
“The
worst thing we could do is to push to put too many houses on the
market, and then the builder has to compromise quality,” McChesney
said.
Brookberry Farms also benefits from a graduated development deal
with the landowner, Wachovia Bank and Trust for Bowman Gray Family.
Rather than purchase 800 acres at once, McChesney arranged to buy land
in four phases.
“We structured the deal knowing there would be
changes in the market over the fifteen- to eighteen-year period,”
McChesney said. “That kept us from getting way, way in debt.”
McChesney
predicted that it would be a long time before developers attempt new
neighborhoods on the scale of Brookberry Farms.
“First the
markets must stabilize, and then there will be a period of slowly
getting back in the game,” McChesney said. “That will impact the size
of deals. It also means that some more businesses will
probably get in trouble or fail.”
“But we’re already seeing improvement,” McChesney continued. “Development in Winston-Salem and Greensboro has always been relatively conservative. That helps get through times like this.”
