BIA/LAV Building & Development Trends Event Summary
Friday, January 21, 2011 at 12:29PM BIA/LAV hosted a builder panel dinner on Wednesday, January 19, 2011 at the Beverly Garland Hotel that featured a range of perspectives on what is in store for the building industry in 2011 and the future beyond. The panel was moderated by 2011 BIA/LAV Board President Jonathan Lonner from Burns & Bouchard.;)
From left: Ken Melvin, Bob Tummolo, Devon Hartman, Mitchell Bradford, Jonathan Lonner, Holly Schroeder
Devon Hartmann from Every Watt Matters, LCC kicked off the panel by introducing new County and State home retrofit programs that aim to improve the energy efficiency of the 75% of California homes that were built before California adopted an energy code (Title 24). Over $3.2Billion will be spent in the next 3 years as part of a 10 year program to reduce energy consumption and improve “whole house performance.”
Mitchell Bradford from Sycamore Urban Properties is focused on buying and completing distressed and half-built projects. Recent acquisitions in West Hollywood and Thousand Oaks are under construction with sales underway, but Mitchell acknowledged that his company will need to continue to be entrepreneurial and adaptive in the quickly changing field of urban infill.
Bob Tummolo from Lennar says they have 600 home sites in the LA/Ventura region in a combination of semi-finished and finished lots. Lennar will continue to focus on production of single-family homes, and Bob recognized the extreme difficulties with multi-family financing today. Lennar has been focused on increasing efficiencies in their supply chain and reducing cycle time for production. As a result of these efforts, hard costs have decreased 20% since 2005.
Ken Melvin from Standard Pacific Homes believes 2011 will look a lot like 2010, with only moderate improvements in sales expected in their Ventura County communities. Ken described their difficulties in getting prospective buyers qualified. Due to the credit damage people have incurred over the past several years, prospecitve buyers do not qualify for a home purchase. Ever-changing FHA underwriting criteria doesn’t help, so Standard Pacific is increasingly searching buyers who have cash and want a quick close.
A lengthy Q&A session covered a range of topics, and many attendees stayed to talk in more detail with the panelists. All in all, a successful event to kick-off 2011!