Starting Over. Acadia Homes took over Wellstone, a 96-unit active-adult community, last year and sold 14 homes in 2011.
Credit: Acadia Homes & Neighborhoods
A year ago, hardly anyone in Atlanta had heard of Acadia Homes & Neighborhoods, a builder that had started up in late 2010.
But when it closed the books on 2011, its first full year in business, Acadia had sold 72 homes in one of the worst housing markets in the country, and closed 53, generating more than $17 million in revenue. This year, the company, which is currently building in 13 Atlanta-area communities, is shooting for 188 unit sales and 160 closings.
What happened that so quickly turned around Acadia’s fortunes? Sam Bass, its vice president of sales and marketing, credits a more focused promotional and selling approach.
When Bass joined Acadia in April 2011, one of the first things he noticed was that its signage was “amiss,” meaning that it wasn’t effective at directing customers to Acadia’s houses. The company at the time also employed three different real estate brokers who also weren’t performing to the company’s satisfaction.
Bass brought Acadia’s brokerage duties in-house. (He currently has 15 agents in the field.) And he created signage with a single color scheme and look to support all of Acadia’s neighborhoods. Bass says Acadia is also getting its message out through multiple listing services, Atlanta’s home directory (for lead generation), and TV informercials that the builder runs twice a month in different markets.
Bass has been in the housing business for 26 years. Like many newly created home building enterprises, Acadia started out with a seasoned team. Its president and CEO, Gregg Goldenberg, has been in the business 19 years, 10 of which were with Morrison Homes. Its vice president of construction, Jon Roby, has been building homes since 1971, including stints with Pulte and McCar Homes. Roby also started Whitehall Construction in 1997.
In-Town Living. The Reserve at City Park in Fulton, Ga., is one of Acadia Homes' infill projects. When completed it will have 43 three- and four-level townhomes.
Credit: Acadia Homes & Neighborhoods
But Atlanta probably wouldn’t be the first choice of many builders looking to start over. Once the country’s largest housing markets, this metro area has seen better days. Its 9.4% unemployment rate exceeds the national average by more than a percentage point, and one in every four jobs lost during the recession was in real estate. The mass influx of new residents that Atlanta had become accustomed to in the first half of the last decade has now slowed to a trickle. And the market has one of the country’s worst foreclosure problems: the Federal Reserve recently reported that Atlanta has the highest number of government-foreclosed properties for sale of any big city.
Builder was unable to determine where Acadia Homes derives its financing. But its investors—who include Goldenberg—saw an opportunity in Atlanta’s anemia, explains Bass. Acadia has been able to pick up finished lots at vastly reduced prices. (Other Atlanta-area builders that Builder has interviewed recently say finished lots are being offered there for $15,000 to $20,000.) Acadia has also jumped on the chance to complete broken projects it has acquired from banks.
One of those projects has been Wellstone, an active-adult community in Cumming, Ga. When Acadia took over this project, only six of its planned 96 condominiums had been completed and 15 started, and there hadn’t been much work done there for a while. Between May and December of last year, Acadia sold 14 homes in this community, and it currently has 67 more units to build out.
Wellstone’s condos range from 1,532 square feet to 1,866 square feet and are priced from $239,900 to $349,900. Acadia is also building single-family homes as large as 4,000 square feet, and urban-infill townhouses that start in the $180s. Bass says his company’s average selling price last year was around $330,000, and he is quick to point out that its homes are “feature rich,” with granite countertops, open floor plans, hardwood flooring, and abundant trim. The builder’s Reserve at City Park infill community recently won two OBIE awards for “Best Interior Model Merchandising Attached Model $299,999 and under” from the Atlanta Sales and Marketing Council.
When Acadia’s management team began mapping its growth for this year, Bass says it was careful not to be overly optimistic. “We kept our projections to no more than two sales per month per neighborhood, and in some one sale.” So far, the company has stayed away from building in Atlanta’s heavily populated south and east quadrants, which right now are havens for short sales. But, Bass states, Acadia has its eye on those markets for expansion eventually. “We already own land there.”
John Caulfield is senior editor for Builder magazine.