Opportunity may well emerge out of difficulty in home building, but not for the faint of start. Chicago's moribund market conditions send shivers up and down the spines of many of the metro area's competitors, but for 74-year old veteran Ron Benach–the original hand behind three Chicago-based operations, which are now part of different owners' empires–the bottom of the market is merely known as business as usual.

SUMMER SPLASH: By opening four communities simultaneously, Lexington Homes is betting that the market is ripe for more infill, and buyers want proximity to work, transportation, entertainment, and retail. Benach's latest business model bets on an emerging urban and first-ring suburban redevelopment niche. Teaming up with his son, Jeff, a former Lennar Corp. executive, to reintroduce the Lexington Homes name to the Chicago market for the first time since the 1980s, the Benach's plan to open four infill communities this summer. The elder Benach was not only behind the original Lexington Homes, he also launched Concord Homes amid the 1992 downturn and 3-H in the late 1960s (See "Benach's Back," below).

Lexington Homes: Part deux has more than name recognition baked into its plan. Benach has reassembled essentially the same brain trust of associates who've been with him in previous ventures. Reporting for duty in the company's executive offices are Wayne Moretti, president and CEO; Jeff Benach, executive vice president; and Max Plzak, CFO.

Old Upstart

"We started buying land over the last few years," says Benach (who serves as chairman) of his activity since the sale of Concord Homes to Lennar in 2002. "We had one piece at 50th and Western, and it looked like the kind of thing where we ought to be building as well as marketing the land. We sat down one day and said, 'Why don't we start up an infill business, try and keep it modest, and fit it in with our other activities?' That's basically what we're doing. "

Lately anyway, start-ups have encountered difficulty in the Chicago environs because of the lack of available land. However, the seasoned Lexington team has enough market muscle to go head-to-head with competitors on prime parcels. "I don't know that there is a magical answer about the timing [of Lexington's rebirth]," says Moretti. "We came together because there are land opportunities."

"There aren't a lot of people buying land right now," concurs Lance Ramella, senior managing director at Hanley Wood Market Intelligence. "If you are going to come in here and do it organically, now is the time, because you can get land. Finding the 'A' locations has always been the problem in the past."

Lexington is not the only company taking new notice of Chicago's shifting market dynamics. On May 31, Columbus, Ohio-based M/I homes announced it will enter the Windy City arena as well, with plans for both single-family and higher density townhome offerings.

According to Ramella, Lexington is one of a host of builders that are angling for an edge in Chicagoland urban and suburban infill. Lennar and Kimball Hill Homes have well-entrenched divisions to target the closer-in land positions in the market. Lexington also will find itself competing with regional players such as the Gammonly Group, Hartz Construction, and Residential Homes of America.

"[Infill] is the strength of this market right now," says Ramella. "Standard suburban single-family is not moving unless it is priced really well. Condos and townhomes are great if they're in an 'A' location."

For the Lexington group, that means established areas that provide proximity to work, transportation, entertainment, and retail. "Those are the kinds of properties that we do and we are constantly on the hunt for them," says Benach. "The nice thing is, if you find a suitable site, you can set up shop and have an interesting development right within a city area. When you are buying 200 [suburban] acres, you are strung out and stuck putting in streets and sewer and water. It's not that I haven't done that in spades, but that's old hat and not what we want to do. We want to create something interesting and be a part of the redevelopment of this city."

According to Moretti, the size of an ideal project is one that offers between 75 and 125 units, although the four Lexington communities coming on line this summer range from 39 to 650 units. After Lexington opens its three projects this summer, it plans to open two additional communities by the end of the year.

–Lisa Marquis Jackson

Benach's Back

Ron Benach has seen his share of Chicago's market machinations through the eyes of several operations.

Late 1960s: Start-up of 3H Building Corp.

1972: Sold 3H to U.S. Home Corp. Start-up of Lexington Homes with focus on suburban master planned communities.

1989: Lexington was among the top three in Chicago market share doing approximately 1,000 units per year. Lexington sold assets to an institutional owner with no home building operations.

1991: Start-up of Concord Homes

1994: Lexington's institutional owner discontinued use of name after teaming up with local builder. Benach retained the Lexington name.

2002: Concord operations were sold to Lennar Corp.

2007: Research revealed that Lexington name had a shelf life in the marketplace. Relaunch of Lexington Homes with focus on infill redevelopment.

Learn more about markets featured in this article: Atlanta, GA, San Francisco, CA, Chicago, IL.