Marketing the Right Products – David Twiggs

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I was speaking recently at the American Association of Retirement Communities national conference in Memphis about “Repositioning the Large Scale Community to be Relevant in Today’s Market” and was asked about effective marketing campaigns. Once you understand your market and have positioned your community to authentically serve relevant lifestyle options, there are some excellent media resources out there for marketing your community.    Ideal Living magazine as a great national example and Center for Carolina Living is a regional platform. However, I quickly turned our discussion to the much-overlooked fact that these media outlets can only convey the story you supply. Marketing can never make up for a product problem and many of our communities have a product problem.

 

If we continue to advertise a 25-year-old story, we will not be attractive to the coming markets. If we cannot actually deliver authentic and fulfilling lifestyle options relevant to today’s market, we will simply fall into irrelevance. The things that drew the people who moved to your community in the past do not motivate today’s market. Not only are we experiencing the change from silent generation to boomers, we are dealing with post recession value shifts and fragmented media.

 

Fixing a product problem is about finding the unique lifestyle options you can provide and creating those opportunities. I work in rural destination and resort style communities so I look at what markets I can develop in addition to the country club sports model that the original developer banked on. Notice, I said lifestyles in addition to, not replacing what we have. Nothing wrong with an element of the country club model but it better not be the only product you offer. The golf centric community market is saturated on all levels and price points but it can still be a strong part of your holistic lifestyle options. If a program you offer is no longer relevant, it will die a natural death. Who is building a new shuffleboard stadium? No one, they are  irrelevant. You had better have lifestyle options relevant to the coming market to attract new growth. We should protect the elements of our lifestyle we love and add complimentary lifestyle options that we can authentically provide. Be Unique. Generic and boring are well represented in the market. You are not trying to attract everyone only those who want your unique lifestyle.

 

For Hot Springs Village, I have developed a Master Plan Workbook in which we explore possible new lifestyle possibilities, housing typology, engagement brands and community branding. Notice this is titled a workbook not an engraved in stone plan. This is an ever changing document. We explore many ideas for lifestyle and community improvements. We don’t implement them all. Some fit some do not, but we are not afraid to explore all options and are daily improving our formally dated products. If you have a unique product, marketing is much easier. Getting picked out of a mass of similar communities is difficult and often leads to wasting our limited marketing dollars.

 

You are welcome to look at the current version of my Master Plan Work Book for HSV. Please remember it is an ongoing presentation piece so some details and all proprietary information such as market studies for housing, hotel, commercial and retail have been omitted. Each community is unique. You can’t simply copy someone else’s model. Look at your products, understand your market, and make sure your story is relevant before you invest your marketing dollars.

CLICK HERE FOR A PDF Masterplan Workbook 1221.2014 UPDATE

https://www.youtube.com/watch?v=7tjFZlnYuFQ

Adding Value is a Long Term Game – David Twiggs

 

I wanted to share the great news from Savannah Lakes Village in McCormick SC and talk a bit about pace.  Adding value to create authenticity and the ability to reposition a community does not happen overnight.   The technology project that allowed SLV to become ” High Tech, High Nature,”  a tag line Kirk Smith created back in 2010 when marketing director for SLV,  was developed over many years. Kirk caught on to this concept early and knew the value it would create.  During those years, Kirk and I continued to create other value added products such as the Savannah Lakes Rod and Gun Club,  the Outdoor Adventure Club, and the context brand of the Little River Blueway Outdoor Adventure Region.  We looked at alternative housing typology with smaller footprints and denser design.  In other words, we focused on creating the conditions for future investment.  We did this daily.  The work and value is cumulative.  From planning individual road signs to creating regional partnerships, it is all part of creating authentic value that will attract quality investment.  To the layman, an announcement comes out in a paper such as one below and the thought is how fortunate for them.  In reality it is the result of many years of hard work adding value.  Create the conditions and the investment will come.  Congratulations to Kirk and the SLV Team for having the drive and focus take the value to the marketplace.  Thanks to Bob Stockton for the article below.

 

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New Developers Enter into Contract to Purchase
Resort Peninsula & Undeveloped Village Acreage

Savannah Lakes Village announced last week one of the most significant McCormick County economic development projects since the creation of the Village itself in the late 1980s.

Better Homes and Gardens’ (BH&G) CEO Tommy Stephenson, Joe Todd, BH&G director of new homes development, and their development team have entered into a comprehensive contract to acquire the existing Savannah Lakes Resort lodge, conference center, two townhomes, the lakefront restaurant, and other undeveloped land along Highway 378 and Holiday Road. The deal would also provide access for BH&G to acquire existing homesites located in Savannah Lakes Village to fuel new housing development programs.

“This investment and redevelopment will ignite visitation and home building programs here,” said Village Chief Operating Officer Kirk Smith. “The resort peninsula is a first impression to visitors coming into South Carolina from Georgia, and we are pleased with the potential of Better Homes & Gardens’ acquisition and reinvestment in these important amenities.

“The broad objective is to re-invest in the resort peninsula, lodge, conference center and restaurant to make it a welcoming entrance to the Village and the County of McCormick,” Smith said.

The strategic acquisitions of these assets are part of a larger development initiative to enhance the Village’s discovery and visitation programs and support both residential and commercial growth.

“We are bringing stability to the table,” said Todd. “All the amenities needed for a great community are in place here, but the most important Village asset is the people. We want to help Village residents to grow this community the way they want to see it grow.”

“Beyond the near-term purchase of the assets is a longer-term objective to create various residential and commercial assets for the Village to realize its full potential,” Smith said. “The first phase of the development project for just the resort peninsula, as envisioned by the developers, will represent a multi-million dollar investment.

“Our development partners share in our values of doing this right, while building a good relationship with Village and county residents. They are in it for more than economic benefit. The actions of all parties are to build confidence and trust,” he said.

Increasing evidence of the relationship is visible in new homes under construction: a Discovery Home on Martin Drive expected to be completed in late January; four new models, and three new spec homes under construction. BH&G has begun Village advertising in Augusta media and will announce major kick-off events — ribbon cuttings and open houses — when warmer spring temperatures occur.

Courtesy of the McCormick Messenger, Story by Bob Stockton (Parts Omitted)

 

Conscious Development: Creating Places Where People Thrive

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Density and Intensity of Eureka Springs, AR

David Twiggs

When is development good?  Many projects and developers took a bad rap over the past few years as projects slowed or were abandoned in the wake of the real estate bubble bust.  I have found this a very interesting time as we have been able to really see the wheat separated from the chaff.  Real value became evident from the sales prices. Some communities held and even grew in value while other stagnated and declined. We can read endless statistics on trends in housing types, square footages, amenities and governance structures.  We can study the different margins offered by new construction techniques. Even after sorting through these, I can find clear examples of  communities that remain great places and seem to defy much of the statistical logic.  Exceptions to the rules so to speak, with varying degrees of buildout, widely different amenity focus and different community personalities.

After looking at hundreds of communities from the most successful to the worst failures, I believe that the communities that have sustainable success are those disciplined enough to keep a conscious focus on creating relevant value during initial planning and as the community matures throughout the years.  Often when we think of value in real estate, perceived value is top of mind.  This seems to stem from a bias to the sales point of view.  A marketers creation of urgency and desire to purchase a specific property is creation of  perceived value in the mind of the potential owner. Property must sell for developers to get return on investment and everyone to paid. Nothing wrong with getting paid for working hard.  I wouldn’t use a marketer who did not know how to create perceived value.  In common usage the term perceived value is used generically to say how a resident feels about their property.  However, as creators of communities, we need to sharpen our vocabulary and be specific in what is created and evolved over time.

Truly successful communities have a different vibe going on. The success of great places comes from the sustained satisfaction of the dynamic population overtime. I call this Relevant Value because it evolves to prove or disprove the perceived value at the point of sale. As our products are typically the most expensive purchase our customer will ever make, we have the responsibility to assure that our marketing promises will not only be kept, but actually create inherently satisfying place to continue to evolve where individuals can thrive.

I believe life is happiness based.  Perceived value can be true or false for a potential owner, was it based in reality or just hype.  A property purchase is typically as aspirational as it is functional. Even more so in second home or retirement based real estate purchases.   Perceived value creates sales.  Some promises even when kept turn out to be hollow. The are not inherently satisfying.  Relevant value creates happy people over time.  It does not matter if our development is for  starter homes, a major tourism destination, or a mix of lifestyles and stages; being conscious of creating places that meet the higher happiness needs of the subcultures we attract is our responsibility.  We must focus on the nature of the different subcultures we want to attract and be sure they are complimentary.  We must be specific not generic.  One community model will satisfy everyone.  Yet for years, the second home and retirement market has basically supplied a single model and cast questioning glances at anyone wanting something different. We must make the right promises and keep them.

Recently, I was having a conversation with Todd Zimmerman of Zimmerman/Volk Associates who is doing a market study for a project I am putting together. After discussing the holistic approach I was planning for this project, Todd gave me the language to describe the elements I was trying to influence, a new framework for the terms of  “density and intensity.”  While Todd was much more eloquent and nuanced in his explanation, I simplified it to fit my need.   Density is how the built environment engages people. Intensity is how the mix of cultures engages people  To create relevant value, we must be conscious to address both to these elements. Exactly how we do this varies with the nature of the place we seek to create and the subcultures we seek to serve.  The quality of place we create impacts the happiness and wellbeing of those we seek to attract. That is a fundamental  responsibility of Conscious Development.

Moving Ideas to Start-ups in Master Planned Communities  David Twiggs AICP

Moving Ideas to Start-ups in Master Planned Communities David Twiggs AICP

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Micro Neighborhood Infill Concept Drawing By Dr. Yang Luo Director of Placemaking Hot Springs Village AR

The only way large-scale communities can move beyond their outdated and market irrelevant pre recession status quo is to become remarkable in a sea of mediocre competitors. This requires developing new ideas, programs, and facilities and taking them to startup mode quickly. Starting is the hardest thing for an individual to do in a bureaucratic, fearful, and hypercritical environment.

This typically is an environment that will debate an idea endlessly in search of perfection; seeking guarantees and prepositioned blame for anything less than a grand slam idea. This is not forward thinking and not applicable for running the nimble businesses we must be post recession market.

Startups aren’t about perfection. They are about taking an idea to the market while it can make an impact. We take an idea, put together a plan, put it on the market, evaluate, and revise. We continue to revise until the product succeeds or fails but we are in the marketplace while it can make a difference. Obviously the higher the cost of failure, the greater the preparation before launch but an idea that is never launched will not succeed and you will learn nothing. An idea launched to late, after it has been proven in other communities, does nothing to make you remarkable. That just makes you a follower trying to keep up with the bold communities.

I believe in due diligence but many start-up opportunities are lost by over caution and collective fear of failure. A start-up designed to make a planned community remarkable is by definition something that others are not doing. If you can find five of your competitors to compare how this idea worked for them, you are simply a follower behind the curve. You are not inventing or innovating anything.

Look at Maslow’s Hierarchy of Needs and determine what level need your community is supplying. The higher up the need you are satisfying, the more remarkable and marketable you are. You will not satisfy everyone as you reach for a higher level. You can never satisfy everyone. Timid community leadership will at best keep their head down and try nothing that is unproved. At their worst they will actively criticize those who will try saying it is not the responsibility of the association. Criticism is only aimed at the bold who standout.

Any manager can follow the manual and dodge criticism. Professional community leaders are paid to create bold new directions. Intuition and courage are the traits to seek in hiring people as game changers. These people will start things. Some things will fail, but fast cheap failures are part of the business process. If I have ten startups and two fail, the failing ideas will get criticized. Is my community better off for the eight new innovative programs and facilities I succeeded with or should I have protected myself by not launching anything that had a risk of failure. If you believe you are doing the right thing, be tough and take the criticism. Being bold is much more fun and in the long run the only way to create extraordinary places.

Where Have the Real Estate Investors Gone? David Twiggs, AICP

Placemaking Planning: Grove Park Market Drawing by Dr. Yang Luo, Director of Placemaking Hot Springs Village, AR

Placemaking Planning: Grove Park Market
Drawing by Dr. Yang Luo, Director of Placemaking Hot Springs Village, AR

I was recently in two meetings that seemed to be lamenting the same condition. All of the real estate investors have disappeared. The consensus seemed to be, the recession killed the real estate investor. One of these meetings was a discussion by several community professionals trying to revitalize their respective master planned communities. The other was a grassroots organization to revitalize a historic but challenged section of a tourism driven city. This got me thinking about the role of private investment in existing community development and redevelopment.

In my present project, I find that the investor has not disappeared at all. The unsophisticated real estate investor is gone. The easy money for any project is gone.

The amateur buying twenty overpriced lots in pre-sale based on a rendering of what might be built is not a reliable entity as it was in the past. We must now supply sound business plans with specific value enhancing strategies; in other words, we must work hard to have projects worth investing in. The recession has killed the lazy uninformed investor that perpetuated mediocre projects. And that’s a good thing.

So how do we find investors in revitalizing our communities? The recession has brought on so many opportunities for assembling property that had previously been sold. Property may have been abandoned and fell into the ownership of an association. It may have reverted back to a town, county, or state for failure to pay the taxes. There is also the shadow inventory of people who pay taxes and assessments but would gladly rid themselves of an unimproved property if there were a market or an entity that would take it. My point, there is now property available at a low cost basis that was not available pre-recession. What are our plans for that property?

Today’s investor wants to see a clear plan for a property to become marketable and relevant to the present and coming marketplace. There needs to be specific strategies for adding value to specific property. Personal real estate is the ultimate lifestyle product. It fundamentally must have real community and ultra-local value. Community value is the lifestyle improvements you receive by living first in the chosen region and then the specific community. There must be true quality of place. There must be relevant lifestyle options.

Ultra-local value opportunities come from fulfilling the original lifestyle promises for all the properties inside a community. Many developers in the past 30 years focused on the premium lot sales. Waterfront, golf courses, view and open space lots were the cash cows and the remaining interior lots were simply not considered as to the livability. This worked in the sales process because the lifestyle of the premium lots was being promised to all; but  it was  never delivered to all in a livable fashion. The buyer of an interior lot finds that they do not have the access and lifestyle of the lake house across the street. They must get in their car and drive to access the lake or any other lifestyle amenity for that matter. It has no ultra-local value. I define ultra-local value as what I can leave my home and do without getting in an automobile. Can I walk the dog down to the lake, can I access a trail system, walk to the art studio, or bike over to a social area, have coffee and people watch? This is ultra-local value.

Value can be a point source. There is not much value to “your neighbor has great lakefront but you can drive to the access just 3 miles away,” or “you can’t see it or access it from here but there is a great open space just over there that you can drive to.” Property was sold as if the prime amenity had ultra-local value rather than simply community value. Look at where your homes developed. What was the source of that value? How much “gravity” does that point of value have? In other words how large a radius of lots does that value impact. A single private home with a great view radiates no gravity to the neighboring lot with no view. A coffee shop that is walkable from 300 homes radiates a lot of ultra-local value while still supplying community value. While we do want to have premium properties available, the premium price garnered by the view, lake or open space lot could be leveraged much better by allowing common access to that point source value gravity in the form of a neighborhood gathering area. This allows the property value and marketability to be raised over all property in a radius rather than at a single point.

The amount of value gravity will always vary by location within the community. From a technical point of view, the investor is looking for investment areas where the existing socio/spacial value gravity can be influenced. Specific improvements are wanted. Defined, understandable, and doable. In more general terms, we must get to work planning our futures. If we have feasible strategies to improve the livability and relevance of specific areas and market those correctly; the savvy investor will find you.