“Affordable housing is good for the community,good for the city,and good for us,” says David Weekley, chairman of David Weekley Homes, about his company being named to build the affordable housing component for the first phase of the Mueller redevelopment project near the old airport in Austin, Texas.
“It's not just a successful business [practice],” Weekley says. “It's the right thing to do, as well.”
Weekley was best-known during the boom years as a builder of second-time move-up homes. Why has the company shifted gears so dramatically?
One answer is the proactive way the city of Austin went about wooing builders. Fees were reduced and building permits expedited. Another big motivator is that David Weekley Homes can also build roughly as many market-rate homes as affordable homes in the project's first phase, 90 market-rate and 71 affordable.
The builder is on the bleeding edge of what could well be an industry trend. A Builder survey conducted for this feature finds that while only 13 percent of builders queried participate in inclusionary zoning programs (mandated set asides), a full 66 percent said it would be “somewhat likely” or “extremely likely” that their companies would participate in an affordable housing project if the municipality had an innovative program that included incentives such as tax credits and streamlined permitting.
“Builders recognize that there's a huge market for affordable housing,” Weekley says. “The challenge is how to reach that market.”
Weekley says his company identified the affordable market as underserved in Weekley's seven-state trade area in the Southeast and Southwest about five or six years ago. It then came out with its Imagination Home series, a product that sells from the low $100,000s.
The Imagination homes are between 1,400 to 1,800 square feet, and usual standard items such as fireplaces and entertainment centers are offered as options. They also have standard-sized windows and uniform ceiling heights, which let the builder save money on framing materials. Weekley says the Imagination homes now account for about 35 percent of the builder's total sales.
“I credit the company's expertise in building an affordable product as a major factor in being named for the Mueller project,” he says.
OTHER PARTNERSHIPS The Mueller project is without question a pacesetting project, but there are other instances where builders are teaming up with local officials. One such partnership has teamed the city of Tallahassee, Fla., with K2 Urban Corp., which is building Evening Rose, a 138-unit traditional neighborhood development (TND). Twenty of the units will be affordable homes.
Learn more about markets featured in this article: Austin, TX.