Sustainable spec home finds buyer in sluggish Steamboat market
September 3, 2011
Steamboat Springs — In a moribund construction market where almost no one is tackling a spec home, the Boulder Ridge development team of contractor David Josfan and Realtor Jon Peddie have proven that not only is it feasible to finance and build a speculative home in 2010-11, but it's even possible to sell the spec house before it's completed. Heck, they're even getting ready to build a second home through the fall and winter.
"We dropped off our plans at the Building Department and hope to get started on the next house in three weeks," Josfan said last week.
The new start was made possible by the $1.61 million sale Aug. 12 of a new 3,400-square-foot spec home on Lot 2, where a worker was installing wooden blinds this week.
Peddie and Josfan formed a business entity, Santa Fe Trails LLC, to develop Boulder Ridge, which was completed in 2008. The subdivision is located on a hilltop overlooking Emerald Mountain, the ski area and the south valley with the back nine of the Rollingstone Ranch Golf Course below. The most desirable of the lots were priced at more than $2 million.
After several years of watching inactivity on the subdivision, which required the construction of an expensive road, Josfan resolved to take action.
"I got tired of waiting and decided to make something happen," Josfan said.
He and Peddie held the conviction that throughout the course of the rise and decline of the Steamboat real estate market from 2007 to 2010, the needs and desires of luxury home buyers had shifted noticeably. Considerably fewer buyers were interested in the 5,000- to 7,000-square-foot trophy homes that represented the ultimate in the Yampa Valley during the past era.
"Part of the reason for building this house was to establish this neighborhood as really well-constructed, sustainable homes of 3,000 to 3,800 square feet because the 5,000-square-foot homes that remain on the market aren't selling at any price," Peddie said. "The people who looked at the spec home had looked at every home on the market in their price range and didn't find what they were looking for."
Together with an investor, Peddie and Josfan are partners in the home that just sold. Peddie is the listing broker. Scott Wither, of Colorado Group Realty, represented the buyer.
Josfan maintains that the lots in Boulder Ridge, linked by an engineered soft-surface walking trail, are the best available in Steamboat. Asking prices now begin at $379,00 and go all the way to $999,900. The original pricing in 2008 began at $975,000 and ran up to $2.4 million.
He is the general contractor for a custom home being built on one of the premium view lots at the top of the cul de sac.
Just as important in his mind is the opportunity for homebuyers to get exactly what they want in a home. He said his design/build team, which includes architect Keith Kelly, of Kelly and Stone Architects, has perfected a streamlined process that eliminates much of the work and stress for owners tackling the construction of a new home from a distant city. Josfan's wife, Alicia, consults from a design standpoint on interior finishes.
"We don't need a lot of meetings with the owners. We make it very, very simple."
"There are so many people out there that want a new home," Peddie said. "Just tell us what you want."
Making it work
To launch their first spec home in the subdivision they developed, Josfan and Peddie had to purchase it from the bank that holds the note on the subdivision.
"We didn't cut ourselves any slack," Peddie said. "Santa Fe Trail is different from the entity that bought the lot."
The key to taking that step was restructuring the original debt with the bank. The lending bank extended its interest reserve to allow them many years to build out the subdivision.
"If it takes 10 years, it takes 10 years," Josfan said. "It's solid footing."
It's all about the house
The new home on Lot 2 in Boulder Ridge cuts a low profile from the street because it is cut into a hillside. It has a broad driveway, and the covered deck on the rear of the home looks at Emerald Mountain peeking through native aspens where construction crews took pains to leave the natural understory of ferns in good shape.
It has four bedrooms, including a master on the main level with its own corner fireplace and a high-end steam shower as well as a freestanding elliptical tub.
Josfan and the architect succeeded in providing many of the features of a larger home into a smaller footprint. There is a three-car garage with its own door to the deck, a wine refrigerator tucked into a kitchen secretary desk strategically located between the kitchen and the dining room. And there is a large recreation room with a wet bar on the walkout level. There are upstairs and downstairs laundries with the option of using electricity or gas.
A considerable amount of the space saving was achieved through the elimination of virtually all hallways, Josfan said. He also looked for every opportunity to add storage in void spaces in the home. But there's really no cause for the new owners to worry about storage — there is a 700-square-foot partially finished room beneath the garage that was left in that condition to allow the buyers to use it in a way that fits their lifestyle.
There are high ceilings throughout, solid hardwood flooring in the great room and dining room and extensive use of real stone inside and out. The kitchen isn't large by 2007 standards, but is equipped with state-of-the-art, energy-saving appliances that include a large refrigerator with separate freezer and refrigerator compartments each with their own motor. It may be an energy-efficient appliance, but it's hard to get past the motorized shelves that allow their height to be adjusted by the owner at the touch of a button.
Keeping it green
Josfan did not pursue LEED certification for the new home, but he's confident from the blower test conducted by a consultant that he would score points. The most overt affirmation of the builders' intent to build an energy-efficient luxury home is the solar array on the south-facing roof elevation. It's expected to provide 85 percent of the owners' water needs year-round.
Less visible is the insulation beneath the concrete slab, Corebond insulation used in the walls and ceiling where most appropriate and an energy-efficient air exchanger that continuously and silently removes stale air from the house and replaces it with fresh air.
Did Josfan and Peddie make a profit from the sale at Lot 2 in Boulder Ridge at $1.6 million?
"Of course I made a profit," Josfan said. "Buyers are able to get a good deal right now because subcontractors are eager to work. We're all making less money than we used to, but that's the way it is."
— To reach Tom Ross, call 970-871-4205 or email tross@SteamboatToday.com