In the largest land buy Taylor Morrison has ever made, the Scottsdale, Ariz.-based builder has purchased 1,200 lots in Crystal Falls, the largest master-planned community in the Austin, Texas, market.
“It was a cash purchase, which really shows the confidence that our company has in Austin,” said Tim Towell, Taylor Morrison’s Austin division president. “We think this is a rare opportunity for us to control this many lots in Austin.”
Just how much cash was involved wasn’t released, and Texas records don’t include the sales price.
Crystal Falls, with Texas Hill Country views, is in Austin’s flourishing northwest corridor. The 5,000-acre master plan was assembled and is being developed by Austin-based The Lookout Group. Roughly 1,000 acres have been developed so far, and the Taylor Morrison purchase includes about 440 acres.
Taylor Morrison already has a number of communities open in Austin. The Crystal Falls land will be a logical next step for the company as it nears completion of its nearby Steiner Ranch development.
There was plenty of competition for the Crystal Falls land, which is near major employment corridors, said Bill Hinckley, president of The Lookout Group, in the announcement. “We pretty much had our choice of partners for this portion of our community.”
In an interview with BIG BUILDER, Hinckley said he decided Taylor Morrison was a good fit because he was impressed with the builder’s development of Steiner Ranch. “[Steiner] was the No. 1 master plan for the past 10 years. They are winding down, the terrain is similar, and the school district is the same, so it just seemed like a perfect fit,” he explained. “I think they are going to help our brand.”
And then there was Taylor Morrison’s willingness to pay cash for the land outright. “What I will tell you is that we’ve had everybody in the world want to buy land from us, and nobody wants to stand up and write you a check,” said Hinckley. “They want all these leveraged terms. We want somebody who has got skin in the game.”
Taylor Morrison has plans to build four new communities, with at least three of them offering new product on its new land. The four communities will all have different price points, said Towell. Model homes will be started immediately, with groundbreaking planned for September and presales planned for fall, he said, adding that he hopes the first homes will be completed by early 2011.
At this point, Taylor Morrison plans to be the sole builder on its new land. “However, if there are builders that have positions that they would consider trading in other areas, we would certainly consider that,” Towell said. Builders already selling homes in Crystal Falls include David Weekley, Perry Homes, Drees Homes, Mercedes Homes, and Buffington Homes.
Hinckley said The Lookout Group plans to concentrate on building homes on the larger custom-home lots in Crystal Falls now that Taylor Morrison is taking on the lion’s share of production home development in the community. “I’m going to focus my energies on the sexier terrain, rough terrain with bigger homes and bigger lots. ... It’s a good fit. I’m back where I want to be,” said Hinckley.
Hinckley began assembling the land some 15 years ago and opened Crystal Falls in the mid-1990s. "We were an overnight sensation that was 15 years in the making,” he joked.
Unlike many communities, Crystal Falls has sold well through the downturn. “We sold homes, sold lots through this bust,” Hinckley said. “If you have to be anyplace in the world right now, Austin is the place to be. There is net in-migration, job growth, and university and state jobs. If the rest of the country would just start bouncing back, we would go crazy.”
Hinckley has another 2,000 acres of Crystal Falls listed for sale and expects some takers. With the decision to choose Taylor Morrison, “I left a lot of people at the altar," he said.
Teresa Burney is a senior editor for BUILDER and BIG BUILDER magazines.
Learn more about markets featured in this article: Austin, TX.