Jeff Burton, president of American Dream Development, raised more than a few eyebrows when he bought the site of an old drive-in theater on Grant Avenue in Junction City, Kan., to build a townhome neighborhood. No one had ever built for-sale townhomes in Junction City, a community of about 19,000 people, about an hour west of Topeka, Kan.
If that weren't enough, the property was in a flood plain where several hundred homes had been wiped out in 1993. Plus, it was surrounded by trailer parks, and the only businesses nearby were several adult-entertainment establishments. Other businesses on the street had closed when the Army's Fort Riley closed its gates to the public after 9/11. Once a base with easy public access, businesses thrived along the road leading into the base. When the gates were closed to the public, traffic along the road dwindled.
“It was a pretty downtrodden area,” Burton admits.
SENSE OF COMMUNITY: With a primary market of young military families, The Village at Freedom Place was designed to foster close relationships among the residents, who often face long separations from their deployed loved ones. Garages are alley-loaded. Fenced front yards face each other along a “green sidewalk” to make it easy for families to interact.
But Burton, a former regional manager for KB Home, was used to working with challenging conditions—and eager to apply the systems he learned as a production builder to his own company in an area poised for rapid growth. Fort Riley is home to the Army's First Infantry Division, known the world over as the Big Red One. With the division's headquarters transferring from Germany to Fort Riley, Junction City's population is expected to nearly double in the next five years. Burton's community, The Village at Freedom Place, is five minutes from Fort Riley's front gate.
The Village at Freedom Place was “a very large step” in the revitalization of the Grant Avenue corridor, says Terry Heldstab, a Junction City commissioner who was mayor when Burton first proposed the project. It easily obtained the approval of the city commission, Heldstab says, but he didn't realize the magnitude of what Burton was planning until it started to come out of the ground.
“It's such a neighborhood concept,” Heldstab says. “They don't have big, huge yards, but you really get a feeling of community. ... [Burton has] brought a really nice product to Junction City.”
Since opening for sale in January 2006, The Village at Freedom Place has been the top seller in the area, which has about 35 builders, Burton says. This year, The Village at Freedom Place has a full 35 percent of Junction City's new-home sales.
LESSONS FROM THE BIG GUYSBurton used every tool he learned at KB Home to drive down costs. He started with the site's infrastructure, cutting costs in half by running water, sewer, and stormwater lines down the middle of the property instead of around the perimeter. His grading plan eliminated the need for $200,000 worth of retaining walls—originally included to achieve the needed flow on the sewer lines—and received the same result with a $30,000 lift station. Then he brought in enough fill to raise the site out of the flood plain and screened it from the trailer parks and adult businesses.
READY FOR INSPECTION: Sgt. Michael Guardiola, an army electronic repair technician at Fort Riley, Kan., inspects his new three-bedroom townhome at The Village at Freedom Place. Guardiola, who is married and has three young children, was the first recipient of a $5,000 down-payment assistance award from the Welcome Home for Heroes Foundation, created by American Dream Development.
To help reduce the appearance of a very dense product, Burton used three colors on each home's elevation—one color on the first floor, another on the second floor, and a third for a band around the windows. “[In] every other development here, they paint everything the same color,” he says.
The placement of the three- and four-bedroom townhomes, which face each other, helps foster interaction between neighbors and provide a safe place for children to play, says architect Brett Deam. The tri-color elevations, with stone accents and James Hardie siding, help bring the buildings down to scale. “When you put six or eight units across from each other, it gets pretty massive,” he says.
Deam sees the value of a centralized area where residents can interact. “With that green street, you open up the interaction between people,” he says.
That's particularly important for military families, says Charlie Williams, director of housing at Fort Riley, who not only is in charge of on-base housing but also works closely with local builders and landlords to identify housing options for military families who choose to live off-base. The Village at Freedom Place is designed to create a sense of security, not only with its fencing but also with the site layout, which clusters the units around central areas, so it's easy for families to keep an eye on the kids and check in on each other. Amenities include a swimming pool, parks, green space, and a children's play area. Plus, the HOA provides lawn service, landscaping, exterior maintenance, and snow removal.
“It's not unusual at all at a military base for soldiers to be deployed and go overseas for 15 months and leave their spouse and kids behind,” Williams says. “They need a quality product where the wife or husband can feel safe. They're living away from their [extended] families. Because of the [neighborhood design], they form a tight-knit community. That's important.”
Inside the units, open floor plans not only help make it easier for buyers to entertain but also help reduce construction costs. Wider hallways and stairwells cut costs on drywall, painting, and baseboard in each of the rooms. “It increases the carpet costs, but you can keep that under control,” Burton notes.
Deam says that the split-level design, the wider hallways, and the openness of the main level floor plan all add a feeling of extra space. “You have 14-foot ceilings because of the split-level plan,” he says. “When you come in the front door, you have a smaller space that looks much larger.”
American Dream Development's biggest profit stream is in the options and upgrades offered in its design center, the first in the state outside of Kansas City, Burton says. He buys granite fabricated in China by the train car and stone from Mexico by the truckload. Again drawing on his experience with a national builder, Burton established contracts with major suppliers, such as Lennox, Shaw Flooring, James Hardie, Merillat, and Whirlpool to keep prices affordable.
AFFORDABLE UPGRADES: Since most buyers are purchasing their first homes and budgets are tight, American Dream Development works hard to control costs on options.
As a former Navy SEAL, Burton was keenly aware of the financial issues faced by young military families and other first-time home buyers.
“Jeff can identify with the young soldiers,” Williams says. “He knows what they can afford and what they can't.”
Burton also knew that he'd face problems selling to a primarily young, military buyer. Traditionally renters, they need to be educated about the benefits of homeownership. For example, because The Village at Freedom Place is part of a revitalization area, homeowners receive a 95 percent rebate on their property taxes their first five years of ownership.
Young soldiers also often have credit issues.
“They do things like [buy] really expensive cars,” he explains. “If you think about credit reporting, you're 20 years old, you get married, buy that Escalade, and you're deployed a lot, the chances of missing payments are pretty high.”
To combat this, American Dream Development responded with education and equity. The builder offers classes to prospective buyers about managing their credit; but where American Dream really trumps expectations is in its pricing. By offering homes below their appraised values, buyers have instant equity.
Like many other first-time home buyers, American Dream's prospects can afford the monthly payment, but don't have much money saved for a down payment. To help address that, Burton started the Welcome Home for Heroes Foundation, a nonprofit organization that raises money through fundraisers and donations to provide down-payment assistance to buyers who couldn't afford a house any other way.
The foundation provides $5,000 to the buyer. In return for that assistance and to reduce the risk of the buyer flipping the house, the buyer signs a secondary lien for that amount with the foundation that has to be repaid at resale. If the buyers live in their house for 10 years, they don't have to pay back the money, which is available to both soldiers and civilians.
“Soldiers get a basic allowance for housing based on what the prices are in the market. The guy working at Wal-Mart doesn't get that,” Burton says. “We wanted to create a program that helped young soldiers and people in the community.”
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LOCATION: JUNCTION CITY, KAN.- Community: The Village at Freedom Place
- Total acreage: 19
- Date opened for sale: January 2006
- Product: Three- and four-bedroom town-homes from 1,696 to 1,871 square feet
- Price range: $134,500 to $152,500
- Total number of for-sale units at build-out: 210
- Sales to date: 60
- Builder/Developer: American Dream Development, Junction City
- Architect: Deam & Deam Architects, Junction City