WilmingtonBiz Magazine - 2018 Residential Real Estate Issue by Greater Wilmington Business Journal / WILMA magazine

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BALD HEAD ISLAND 2.0 BHI Ltd. CEO Chad Paul on the islandâ&#x20AC;&#x2122;s next chapter

RAMPING UP AGAIN IN BRUNSWICK HOUSING SALES UPDATE

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Greater WWilmington G Published by

reater ilmington BUSINESS BUSINESS JOURNAL JOURNAL

An Auspicious Day for Luxury Real Estate in Southeastern North Carolina.

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“We moved into our home in the middle of August 2017 and could not be happier with the quality of the construction and incredible attention to detail that Mark and his team applied to the buildout. Simply put, the MJCH team takes great pride in what they do!” Rob & Dale Johnston

An Obsession for Customer Satisfaction

Our mission is to build the highest quality homes, while exceeding expectations and creating very happy clients.

Process Defines Our Difference Homes Built on Reputation

View our new website to see what puts the “custom” in our custom homes: 2

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www.MarkJohnsonCustomHomes.com

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Mark Johnson Custom Homes :: 910.443.5422 :: info@markjohnsoncustomhomes.com

Fountain Financial Associates is one of Wilmington’s oldest and largest independent financial planning and investment management firms. The firm was established by Vinton Fountain in 1998 to provide successful individuals with a personally tailored option for the management of their financial lives.

We believe…

• Independence is the most important attribute for a client-centered relationship • Shared risk is preferred by using a fee-based model • Working with business owners is superior to employee-based advice • Bigger is not better, a small firm with robust resources is preferred • An advisor should possess proven knowledge, experience, judgment and instincts

Fountain Financial Associates 910.256.8882 | FountainFinancial.net 1209 Culbreth Dr. Suite 100 Wilmington, NC 28405

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Over 50 Reciprocal Clubs Around the World Private Fine Dinning

Beautiful Unique Spaces for Meetings, Events, and Parties at No Cost To Members

Monthly Networking Events Unigue Specialty Dinner Events

Call to learn more about the amenities of a City Club membership (910) 343-1880 ext 206 :: www.CityClubOfWilmington.com w i l m i n g t o n b i z m a g a z i n e . c o mPHOTOGRAPHY BY SUSIE LINQUIST PHOTOGRAPHY, 2 0 1 8 R eVISIT a l ESUSIELINQUIST.COM s t a t e I s s u e

The best-selling lists are by no means the Forest has received over the 10 years it h

“It only makes sense that we consistently Brunswick Among Top-amenities, Selling because of ourForest outstanding lan Master-Planned Communities In The United States said Helms. “We have won numerous awa Golfweek ”RCLCO also reported that developers ha 2018, expecting sales to stay on pace, or the factors mentioned is the concept of a Helms points out is a hallmark of Brunswi Must play course ®

Tennis/Pickleball Kayaking

there’s local success, regional success, & then there’s how you stack up nationally. In early January of 2018, Brunswick Forest was named among the top 50 best-selling master-planned communities in the United States by two national real estate research and consulting firms: RCLCO and John Burns Real Estate Consulting. With 395 net sales in 2017, Brunswick Forest came in at 32nd in the RCLCO report and 33rd in the John Burns list. Brunswick Forest, located just over the Cape Fear River Bridge from downtown Wilmington, was the only community in coastal North Carolina to make these lists, and one of only two statewide.

According to the RCLCO article, one of the keys to achieving strong sales is having “an adequate supply of moderately priced homes targeting the largest market audiences.”

Helms expounded on that point. “While unquestionably a beautiful, amenity-rich community, Brunswick Forest is affordable for many income levels,” he said. “It has been intentionally designed to appeal to a variety of people for a variety of reasons.”

MAKING THE LIST FOR HOMES & AMENITIES, TOO

“All of our amenities are extremely well u residents tell us all the time that they hav active or happier in their lives,” he empha recognition we appreciate most.”

“Masterplan sales surged in 2017,” reads the John Burns Real Estate Consulting newsletter. “Together, the top 50 masterplans sold 27,580 homes, reflecting a 17% year-over-year increase from 2016. Their combined 2017 sales represent approximately 4.5% of all new home sales nationally.”

The best-selling lists are by no means the only recognitions Brunswick Forest has received over the 10 years it has been in development.

MASTERING THE MASTERPLAN CONCEPT Jerry Helms, vice president of sales for Brunswick Forest, said the developers were thrilled with the news, but not completely surprised.

“It only makes sense that we consistently achieve high sales because of our outstanding amenities, land plan and homes,” said Helms. “We have won numerous awards in all of those areas. ”RCLCO also reported that developers have optimistic outlooks for 2018, expecting sales to stay on pace, or perhaps increase. One of the factors mentioned is the concept of an active adult village, which Helms points out is a hallmark of Brunswick Forest. “All of our amenities are extremely well used, and we have residents tell us all the time that they have never been busier, more active or happier in their lives,” he emphasized. “That’s the kind of recognition we appreciate most.”

We invite you to tour o

“We have consistently experienced record growth, year after year,” said Helms. “Quite simply, our strategy is to deliver precisely what people desire in a home and community, and to offer that across a range of sizes, styles and price points.”

We invite you to tour our community.

l m i n g t o n B i z M A G A Z I N E 910.371.2434 | Brunswickforest.com | MODEL HOMES OPEN DAILY

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LETTER FROM THE EDITOR BEHIND THE NUMBERS SOUND OFF NEWS DIGEST THE TAKEAWAY

F E AT U R E S

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BALD HEAD ISLAND 2.0 BRUNSWICK REBOOT REAL ESTATE TRENDS IN PROFILE: TORONYA EZELL IN PROFILE: DAVE SPETRINO MARKET SNAPSHOT

ON THE COVER

34 PHOTO BY T.J. DRECHSEL

Bald Head Island Ltd. CEO Chad Paul is shown at the island's marina.

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Alpha Mortgage Corporation is the local leader in home mortgages, a position we have proudly held since 1983. WE LEAD the market in innovation and extraordinary customer service. WE PROVIDE in-house processing and underwriting and timely closings. WE PROTECT our customers’ financial interests every step of the way. T O L E A R N M O R E , C A L L U S T O DAY AT 9 1 0 - 2 5 6 - 8 9 9 9

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1320 AIRLIE ROAD, WILMINGTON, NC 28403 • 910.256.8999

l m i n gAlpha t o Mortgage n B i z isMlicensed A G A inZ North I N ECarolina (L-113831), Virginia (MC-4927), & South Carolina (93265). NMLS#93265 Alpha Mortgage is licensed by Virginia State Corporation Commission as MC-4927 http://nmisconsumeraccess.org

LETTER FROM THE EDITOR

TA K I N G STOCK O F T H E HOUSING RECOVERY

“I

t ain’t what you don’t know that gets you into trouble. It’s what you know for sure that just ain’t so.” That’s how The Big Short, the 2015 film about the housing bubble and ensuing financial crisis, opens. Based on Michael Lewis’ book, it’s probably the only movie that made millions at the box office by explaining how subprime mortgage-backed securities work. So a decade after the start of the Great Recession – economists picked December 2007 as the starting point – here’s what we know for sure: Looking back, it took longer for the downturn’s tentacles to reach Southeastern North Carolina. But with the region’s economy so closely tied to the housing boom, it was only a matter of time before it hit – hard. (Some lessons remain back of mind for those still in the industry, such as builder Dave Spetrino, who shares his story on page 34.) Edward Graham, finance professor at University of North Carolina Wilmington, and UNCW’s former regional economist Woody Hall came up with their own informal index to track the rise and fall of residential real estate activity back then. “The index suggests that the Wilmington, Cape Fear-area market peaked in 2007 and 2008 of an index value of around 167, 170,” Graham said. “Then it retrenched about 30 percent.” We all know what happened next, and it took years to recover to where the region is today. (For one example, turn to page 26 about developments in Brunswick County picking back up where they left off.) Here’s something else we know: Area home sale activity now has rebounded from those lows, and in some months even surpassed activity from the highs of the housing bubble. Closed sales volume for the tri-county area swung from a peak of over 12,000 homes sold in 2005 down to 5,000 in 2009. It has steadily climbed back up to more than 11,200 sales last year,

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according to Cape Fear Realtors stats. (Find more market stats on page 38.) And then there’s housing costs. “Prices are at new all-time highs. Median prices – we’re in new territory now,” said Graham, though adding, “It’s not egregious.” Which leads to maybe what we don’t yet know: Are we setting ourselves up for another overheated housing situation? Despite the uptick in activity – and return of the open-house legends of people selling their homes in days or even hours of listing – there are some key differences, Graham said. “The overlending does not appear to be taking place,” he said about a major reason separating today’s market from the housing crisis. Personal income and employment also are holding steady. “Will they collapse? Absolutely not,” Graham said about today’s housing outlook. “I’m very careful making predictions, so I can’t predict where the real estate markets are going. But they’re not going to collapse.” A decade later, one can hope we’ve learned to better tell what’s so and ain’t so this time around.

VICKY JANOWSKI, EDITOR vjanowski@wilmingtonbiz.com

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CONTRIBUTORS

M A G A Z I N E

2 0 1 8 R E A L E S TAT E I S S U E – $ 4 . 9 5

ALLISON BALLARD ALLISON BALLARD is an award-winning journalist who has covered the environment, food, film and Wilmington community since 1999. Her work has appeared in regional and national publications. She has graduate degrees from UNCW and the University of Cape Town. Ballard profiles AMEZ Housing Community Development Corp.’s Toronya Ezzell in “House Counsel” (PAGE 32).

Publisher Rob Kaiser

rkaiser@wilmingtonbiz.com

President

Robert Preville rpreville@wilmingtonbiz.com

A s s o c i at e P u b l i s h e r Judy Budd

jbudd@wilmingtonbiz.com

Editor

Vicky Janowski vjanowski@wilmingtonbiz.com

A s s i s ta n t E d i t o r Cece Nunn

K E V I N MAURER KEVIN MAURER is an award-winning journalist and bestselling co-author of “American Radical” and “No Easy Day.” A graduate of Old Dominion University, he is a regular contributor to Salt Magazine and the StarNews. Maurer checks in with Bald Head Island Ltd., the developers of the Brunswick County community, and its next steps in “Back to Basics” (PAGE 20).

cnunn@wilmingtonbiz.com

Reporter

Christina Haley O'Neal chaley@wilmingtonbiz.com

VP of Sales/Business Development Melissa Pressley

mpressley@wilmingtonbiz.com

Senior Account Executive Craig Snow

csnow@wilmingtonbiz.com

Account Executives Polly Holly

pholly@wilmingtonbiz.com

Lynn Murphy

L A U R A M O O R E LAURA MOORE is an adjunct English instructor at Cape Fear Community College. She has a background in writing, public relations and education and holds a BA in professional and creative writing, a M.Ed. in workforce development and recently earned a graduate certificate in technical and professional communications from ECU. She looked at one neighborhood’s rebound in “Rebooting in Brunswick” (PAGE 26).

lmurphy@wilmingtonbiz.com

Business Manager Nancy Proper

nproper@wilmingtonbiz.com

Events Director Maggi Apel

mapel@wilmingtonbiz.com

E v e n t s / D i g i ta l A s s i s ta n t Justine Bledsoe

events@wilmingtonbiz.com

D e s i g n & M e d i a C o o r d i nat o r Molly Jacques

production@wilmingtonbiz.com

Content Marketing Editor

T. J . DRECHSEL T.J. DRECHSEL, of Drechsel Photography, is a Wilmington-based photographer whose work has been featured in publications including WILMA, Greater Wilmington Business Journal, Wrightsville Beach Magazine and North Brunswick Magazine. He specializes in wedding and landscape photography. Drechsel shot the photo for the WilmingtonBiz Magazine’s Residential Real Estate cover as well Bald Head Island’s many sides in “Back to Basics” (PAGE 20). tjdrechselphotography.com

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Hilary Snow

hsnow@wilmingtonbiz.com

Contributing Designer Suzi Drake

art@wilmingtonbiz.com

C o n t r i b u t i n g P h o t o g r ap h e r s

Chris Brehmer, Katherine Clark, Megan Deitz, Michael Cline Spencer, Terah Wilson

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BizBites BEHIND THE NUMBERS |

NEIGHBORHOOD TREND

THE DIGEST

SOUND OFF

photo by TERAH WILSON

Julia and Jamey Steffen moved into their double-gallery, Charleston-style home in 2011, settling into The Village of Woodsong, a 35-acre neighborhood in Shallotte. Woodsong is an example of a TND, or Traditional Neighborhood Development, that uses master-planning touches to create a village-style neighborhood with walkable networks, mix of housing styles and green spaces.

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TAPPING INTO THE EXPANDING CASTLE HAYNE AREA BY CHRISTINA HALEY O’NEAL DEVELOPMENT IN THE CASTLE HAYNE AREA could get a boost from a proposed water line project, on which the Cape Fear Public Utility Authority board is slated to vote April 11. The board will consider a 16-inch water line in its capital improvement plan for the 2019 fiscal year, authority spokeswoman Peg Hall Williams said. The proposal, called the Northern Water Main project, would provide 2 million gallons a day of water capacity for future development, she said. That’s enough new capacity for an additional 5,000 residences mixed with commercial or industrial growth in the area. If it is approved, the $4 million project’s target completion date would be mid-2020. Developers of River Bluffs, who worked with Cape Fear Public Utility Authority (CFPUA) to bring sewer infrastructure several years ago to the 313-acre subdivision in Castle Hayne before it was built, say the water project could bring more investment to the already growing area. River Bluffs developers paid for the installation of a 6-mile, force main sewer system at a cost of $4 million, said John Lennon, director of sales and marketing for River Bluffs Development Corp. “We entered into a developer agreement with CFPUA in 2012, which had us turn over the sewer system to the CFPUA after its completion and allows for us to recoup some of the cost as new users tie into the system over the next 20 years,” Lennon said. While River Bluffs currently has the water capacity it needs, the addition of a water line up Castle Hayne Road is an ideal scenario for growth both in and around River Bluffs, Lennon said. River Bluffs contains nearly 100 homes but is permitted for 738 units, Lennon said. “It’s an area that I think is ripe for development,” he said. “For years, much of northern New Hanover County, in particular the Castle Hayne area, was really untouched in terms of infrastructure and also in terms of development opportunity.”

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by 2040

*low-growth estimate

BRUNSWICK, NEW HANOVER & PENDER

11% INCREASE IN HOUSING UNITS SOLD

PROPOSED WATER LINE EXTENSION TO CASTLE HAYNE AREA

PROJECTED POPULATION

-20

24,000

FEE T

551,642*

NUMBERS

BRUNSWICK, NEW HANOVER & PENDER COUNTIES

BEHIND THE

BRUNSWICK, NEW HANOVER & PENDER 1

$ 1

148

AVERAGE HOUSING PRICE PER SQ FT NEW HANOVER

26% OF HOMEOWNERS HAVE DIFFICULTY AFFORDING THEIR HOME

Sources: Cape Fear Realtors, New Hanover County Comprehensive Plan, N.C. Housing Coalition

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WHAT TO DO ABOUT SHORT-TERM RENTALS? AT ISSUE: With the rise in

popularity of vacation housing rental websites, cities across the country are trying to figure out how to regulate the revenue generators and balance property rights arguments, including those from upset neighbors. In Wilmington, where an estimated 400 homes or rooms are used for short-term rentals, city

officials have been researching and debating policies for them since 2015. Because the city’s existing code doesn’t directly address shortterm rentals, Wilmington is relying on related regulations. So until something more specific on the topic is passed, a home (or room) is supposed to be rented out for at least seven days – though in the gray area of the current impasse, that’s not

A SENSIBLE COMPROMISE NEEDED

OPPORTUNITY TO LEAD FROM THE FRONT

hort-term rental businesses demand that Wilmington change residential zoning regulations to allow unlimited, unsupervised, nightly, “whole-house” rentals in all Wilmington neighborhoods. This change would hurt neighborhoods and housing and is not necessary to support tourism. Short-term rental (STR) businesses buy homes, displace residents and rent whole houses for a night or weekend at inflated rates. Many operate multiple properties in multiple cities. STRs operate in most Wilmington neighborhoods in alarmingly growing numbers. In three years, local Airbnb listings increased 543 percent (from 83 listings in November 2014 to 534 in

really happening. The latest: In January, the Wilmington Planning Commission was unable to agree on certain proposals during the latest of a string of public hearings held on the issue. In March, the planning board and city council held a joint work session on a proposed draft of short-term rentals regulations. And the debate continues.

S Y L V I A KOCHLER October 2017 – most listings are whole-house, not room, rentals). STR businesses have no “property right” to operate in neighborhoods; residential zoning regulations prohibit STRs. STR businesses knew this, went into neighborhoods anyway, and now demand Wilmington legalize their violations and protect their profits at locals’ expense. Whole-house STRs in neighborhoods: • reduce housing supply and affordability; • create economic risk by tying residential property values to tourism’s ups

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t’s really hard to read article after article that gives credit to website platforms like Airbnb and HomeAway for “pioneering” the shortterm rental (aka vacation rentals) movement. Go to any tourist destination in the country, and you’ll run into someone who has “rented out” their beach/mountain house for years when not enjoying it. You’ll also run into local real estate businesses that have been stewards of these second homes for their friends and clients for 20, 30, even over 50 years. Short-term and vacation rentals are not new. They have been a mainstay for family and friends seeking a more authentic experience, more space and better prices so they can enjoy time together on a more personal level.

M I K E HARRINGTON It seems over the past few years, the arguments against short-term rentals starting to proliferate in more urban areas have been a cut-and-paste endeavor. Party houses, hurting the “fabric of the neighborhood,” affordable housing have all been major campaign slogans used against property owners that have turned their home into an opportunity to earn a secondary income. In my opinion, most of these arguments do not hold water. Drive by any area and compare a home that is owned as a long-term

BizBites

CROWDSOURCING REACTIONS, OPINIONS AND QUOTABLES FROM OUR ONLINE SOUNDING BOARDS

W I L M I N GT O N B I Z . C O M

O N FA C E B O O K . C O M / W I L M I N GT O N B I Z PLAN TO LIST YOUR HOME FOR SALE THIS YEAR? NO

YES

PLAN TO BUY A HOME THIS YEAR?

YES

T W I T T E R : @ W I L M I N GT O N B I Z WHAT NEIGHBORHOOD/AREA WILL BE THE REGION’S NEXT REAL ESTATE HOT SPOT? “SEAGATE!!” – @WBBREWERY “ NORTH BRUNSWICK County/Navassa on the river”– @CHRISROGERSILM “@CARGO_DISTRICT” – @SANDYGUERRIERE

“PHILOSOPHICALLY, WE DON’T WANT TO BE A COUNTY that redistricts every year. High-growth counties like Wake [County] are usually moving some students on a regular basis. They’re building schools so fast that there are some growth issues there,” – NEW HANOVER COUNTY SCHOOLS SUPERINTENDENT TIM MARKLEY ON THE ONGOING SCHOOL REDISTRICTING DISCUSSION “THERE’S A LOT OF ROOFTOPS AROUND here that have been here for many years, and The Pointe at Barclay is a landmark project … like what Mayfaire did for that part of town.”– JIM WALLACE, FOUNDER AND CEO OF INTRACOASTAL REALTY, ON THE FIRM’S DECISION TO OPEN AN ADDITIONAL OFFICE AT THE POINTE AT BARCLAY THIS YEAR

KOCHLER and downs; • hurt neighborhood character and quality of life by replacing neighbors with weekend visitors and nuisance behavior (parties, noise, overcrowding, parking problems); • sit empty midweek, during off-seasons and recessions, increasing risk of crime (Wilmington Police Department says resident-occupied houses deter neighborhood crime); and hurt hotels and businesses that serve locals, costing jobs and investment. Cities that liberally allowed STRs in neighborhoods suffered and now struggle to limit them (Vancouver, Seattle, New Orleans, Charleston). Cities that have long prohibited whole-house STRs in neighborhoods (Asheville, Myrtle Beach) have vibrant tourism, economies and tax bases.

Wilmington should adopt Asheville’s time-tested model: 1) In business and mixed-use districts, liberally allow all types of STRs (B&Bs, whole-house and room rentals). 2) In residential neighborhoods, prohibit wholehouse STRs but allow “homestays,” where a resident lives in the house, is permitted to rent up to two bedrooms as guest lodging and must be present during the rental. 3) In all cases, require STRs to be licensed, be insured, pay taxes and comply with safety rules. With this compromise, locals and tourism benefit from STRs, without sacrificing neighborhoods and housing. Sylvia Kochler is a downtown resident who serves on several nonprofit boards. Views expressed are her own and do not represent any groups.

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With Airbnb now automating and paying on behalf of the property owner in North Carolina, technology is catching up and leveling the playing field for those trying to cheat the system. Additionally, enforcement of erroneous occupancy caps on nights booked, “zones” where one can rent their property and reclassifying properties between owner occupied and non-owner occupied will prove to be an unsustainable government oversight and further drive shortterm rentals underground. Regulations have their place, and I believe in Wilmington an acceptable balance can be struck but only if we have an objective viewpoint from both sides. Mike Harrington, president of Topsail Realty Vacations, is president of the Vacation Rental Management Association.

HARRINGTON rental and one that is offered as a short-term rental. More often than not, the level of care, involvement and investment back into the property is quite a bit different. Are there bad apples? Sure. However, the fundamental nature of the shortterm rental model is based on hospitality. Ultimately, short-term rentals are not going away. For a progressive, growing city like Wilmington, this is a real opportunity to lead by example as a new economy advocate. As many governments are playing catch-up with the increase in shortterm rentals in their area, they would all be wise to look to their tourist area neighbors and the benefits they have enjoyed in their communities through occupancy tax collections over the years. 2 0 1 8

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DIGEST THE

A R O U N DU P O F R E C E N T R E S IDE N T IA L R E A L E STAT E NE WS

SOUTH FRONT’S NEXT APARTMENTS FILL UP PHOTO C/O LANDMARK SOTHEBY’S INTERNATIONAL REALTY

HIGHDOLLAR HOME SALE A Wilmington property that includes a mansion designed by Lincoln Memorial architect Henry Bacon sold for $4.9 million during the first quarter, in a deal hailed as the highest-priced residential sale in New Hanover County in more than 10 years. The property, called Live Oaks, holds a neoclassical Southern mansion on 7 acres along the Intracoastal Waterway at 7521 Masonboro Sound Road. “Built in 1913, Live Oaks was a summer playground for the rich and famous of the early 20th century, hosting the likes of the Vanderbilts and Astors as frequent visitors,” stated an announcement from Landmark Sotheby’s International Realty.

David Benford, broker in charge of the Wilmington office of Landmark Sotheby’s International Realty, represented the buyer, Oak Forest Properties LLC, and the sellers, Hormoze and Suzanne Goudarzi, in the transaction. Benford said the home had been on the market for about a year. The only higher-priced New Hanover County sale of a strictly residential property took place in March 2005 and was the $5.25 million sale of the home at 49 Pipers Neck Road on Figure Eight Island, said Kathleen Baylies, broker in charge of Just For Buyers Realty, based on a search of the N.C. Regional Multiple Listing Service. When the Goudarzis bought the Live Oaks property, for $4.25 million in 2015, according to New Hanover County property tax records, they did so with the aim of keeping it from being subdivided and redeveloped, Benford said. It was not their primary residence. The buyer is keeping Live Oaks as one house on one property, he said.

– CECE NUNN

TO STAY IN THE LOOP ON THE LATEST REAL ESTATE HAPPENINGS, CHECK OUT THE WEEKLY REAL ESTATE UPDATE NEWSLETTER. SIGN UP AT WILMINGTONBIZ.COM.

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The apartment development that reclaimed a former industrial building hit the fully-leased mark this year, according to officials with Tribute Properties Inc. South Front Phase II apartments, 1510 S. Third St. in Wilmington, includes 43 one-bedroom apartments and 11 twobedroom apartments. The units range from 600 to 1,400 square feet, with rents coming in at $1,050-$1,725. The latest section joins the original apartments that opened in 2012 in the rehabbed Nesbitt Court public housing units and a commercial section.

H O U S I N G I N V E N TO R Y: AV E R A G E M O N T H S O F S U P P LY 0

2013

9.2

2014

8.7

2015 2016 2017

7.0 5.1 4.0

1,500 U NIT S

ESTIMATED SHORTAGE OF HOMES IN THE WILMINGTON MARKET BY 2019, ACCORDING TO METROSTUDY

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BACK to BASICS BY KEVIN MAURER

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P H O T O S B Y T. J . D R E C H S E L

When the Mitchell family bought Bald Head Island in the 1980s, they developed a community unique to North Carolina. Now, with its neighborhoods and businesses firmly established, the company that transformed the remote enclave is moving into its next phase by focusing on its real estate roots.

hris Cosgrove first went to Bald Head Island in the 1970s when he was 8 years old. One of five boys, Cosgrove remembers taking a small boat from Southport to the Bald Head dock. Everything the family needed had to come over in the boat because there was little on the island except an old lighthouse and wild pigs. The Cosgrove family trips to the island started when his parents were scouting out home lots. They wanted to build a beach house, and it was between Bald Head Island and Holden Beach. At the time, Bald Head was just a golf course and a few houses. “My parents wanted something different,” Cosgrove said. “They liked roughing it.”

Cosgrove’s parents – Ken and Eleanor – chose Bald Head after a few trips and built the seventh house on the island in 1975 on Mourning Warbler Trail near the island’s South Beach. “That was a very risky endeavor,” Cosgrove said. “It took a while for people to take hold and trust it was going to be a success story. Gradually over time things snowballed. Once it became popular, it escalated very quickly.” What started as a barren stretch of sand, maritime forest and marshes at the mouth of the Cape Fear River has evolved into some of the priciest real estate in North Carolina. Last year, the median residential sale price was $660,000, and the highest price was $1.85 million. The island earned a reputation as an exclusive playground for the

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rich, but it is the natural beauty that makes the island special. That beauty is what brought the Cosgroves and others to the island and what Chad Paul, Bald Head Island Ltd.’s CEO, wants to preserve as the company divests many of its holdings and returns its focus to real estate. “It’s all about the environment, to protect the natural beauty,” Paul said. “We’re selling a community. We’re selling being one with nature.”

H U MBLE BE G INN IN GS

Bald Head Island has always been quiet. It was popular with smugglers and pirates before its transformation into an affluent community of 250 permanent residents that balloons to about 5,000 visitors and vacationers during

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BALD HEAD ISLAND

$48,540,533

$36,346,750

$42,480,530

$52,678,035

$37,100,500

$63,898,450

TOTA L R E S I D E N T I A L S A L ES

2012

2013

2014

2015

2016

2017

2017 ACT I V I T Y $63.9 M $1.15 M 86

19 YRS 131

IN C LOSE UP

TOTAL RESIDENTIAL SALES TOTAL FRACTIONAL OWNERSHIP SALES RESIDENTIAL TRANSACTIONS AVG AGE OF LISTED HOMES MEDIAN DAYS ON THE MARKET FOR HOMES SOLD

$11.99 M

PRICE OF THE 5,514-SQUAREFOOT CASTELLO DELLA BELENA HOME ON SHOALS WATCH WAY, THE MOST EXPENSIVE HOME LISTED FOR SALE IN NORTH PRICE OF THE 5,514-SQUARE-FOOT CAROLINACASTELLO DELLA BELENA HOME ON SHOALS WATCH WAY, THE MOST EXPENSIVE HOME LISTED FOR SALE IN NORTH CAROLINA SOURCE: N.C. REGIONAL MULTIPLE LISTING SERVICE

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the summer. The Cosgroves’ first house had three bedrooms and three bathrooms. The family ran an old Army generator in the morning for about 30 minutes and then again at night for about an hour. Games were played and books read by candlelight or gas lamp. “It was real primitive,” Cosgrove said. It wasn’t until 1983 when George Mitchell purchased the island out of receivership that things started to change. The Mitchells brought electricity, which ended the island’s “Generator Society” as the first beach house owners on the island were known. But, Paul said, the Mitchells also brought a plan. Setting aside 2,000 acres for development, the rest of the island’s 10,000 acres was put in a conservation trust. “It was an island (George Mitchell) didn’t want to see get wrecked,” said Paul, a Wilmington businessman who was tapped as M A G A Z I N E

CEO in 2010. There is no construction on weekends, and the houses are often tucked into the maritime forest. Straight roads are almost nonexistent, except for Federal Road, created in the early 1900s to bring supplies down to the Cape Fear Lighthouse Station, which was demolished in 1958. (Old Baldy, the oldest standing lighthouse in the state, remains an island icon.) Most of the roads zigzag around the trunks of ancient oak trees. A restriction on combustible engines led to transportation by golf cart and the preservation of the island’s soundtrack of waves hitting the shore. Almost everywhere on the island sounds like the inside of a seashell. “We were green before it became popular,” Paul said. Bald Head Island is known for houses like the 5,514-squarefoot, five-bedroom “Castello della Belena” – Castle of the Whale – that overlooks the beach. The house is on the market for nearly $12

million, making it the most expensive home for sale in North Carolina. While the Castle of the Whale is out of reach for most vacation homebuyers, Bald Head Island isn’t. Of the approximately 1,260 homes on the island, Paul estimates that 400 of those participate in some type of resort rental program. That’s how Tom and Alicia Williamson found their home. Tucked into the maritime forest, they own a portion of a vacation house at 22 Earl of Craven Court in The Hammocks development. Owners get four weeks a year on Bald Head. “I feel like a child at my birthday,” Alicia Williamson said about when their weeks come up. “It’s an opportunity to get away from it all. It feels like a world away.” Their favorite weeks are in the off-season when the island is just yearround residents, wildlife and quiet. “There is a sense of real ownership when you’re alone out here,” Alicia Williamson said.

Aerial photo c/o BALD HEAD ISLAND LTD

REAL E STAT E ST R AT EGY

Maintaining the illusion of Bald Head Island being miles from the mainland is at the heart of Paul’s job. He is only the second Bald Head Island Ltd. CEO not affiliated with the Mitchells, the original family of developers. Though Paul sat on Bald Head Island Ltd.’s executive committee before his appointment, he did not come from the typical real estate background that naturally feeds into running a property-focused firm. His previous roles included managing partner of private equity investment firm Harbor Island Partners LLC as well as working for JPMorgan Chase, Salomon Brothers and Arnolt Partners. When Paul took over, Merchant’s Row wasn’t fully occupied. But since the company has divested, there is 100-percent commercial occupancy and no business or tenant failures. The company also shed its ferry business, which it ran for the past three decades to shuttle visitors and

Alicia and Tom Williamson bought into a resort rental program for a house in Bald Head Island's maritime forest portion.

homeowners between Southport and the island. A state-authorized Bald Head Island Transportation Authority has been formed to take over the operations. Bald Head Island Ltd.’s reemphasis on development comes as home sales are on the rise. Last year saw a significant increase in sales of residences, fractional ownerships and land islandwide, jumping from $50 million in 2016 to $80 million in 2017. And 2018 is looking strong as well. In the first couple of months of the year, Bald

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Head Island Ltd. had $9.5 million in sales, up $4.7 million from the same time last year. “The improvements were due in part to continued growth in the U.S. economy, along with the higher island visibility created by the Southern Living Idea House at Cape Fear Station,” Paul said. Cape Fear Station is Bald Head Island Ltd.’s planned community. Paul said the Southern Living partnership is the future as the company partners with entities that reflect Bald Head Island Ltd.’s vision. R

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Like everything on the island, every detail down to the price point was planned. Houses for sale on the island had an asking price of around $1.2 million but were selling for closer to $630,000. Cape Fear Station houses sell in the $700s. “The sweet spot for pricing Southern Living was to bridge the gap between the $1.2 million ask and the $630,000 average price in 2015,” Paul said. “Our aim was to deliver value that could bridge that gap. In hindsight, we executed perfectly.”

STAT E OF T HE I S L A ND

As Paul drives around the island, he emphasizes his one mandate. “Maintain the stewardship of the island,” he said. That means less about the money and more about preserving the natural beauty and aesthetic. The birds, turtles and crashing waves sell Bald Head Island more than he can. It also means Bald Head Island Ltd. is looking for partners like Claude Pope,

who took over the Maritime Market, the island’s only grocery store. Pope started coming to the island in 1988. In 2001, after his 40th birthday party, Pope was floating in the Atlantic and made a decision. “We’ve got to find a way to get here,” he told his wife. They bought a condo soon after and then a house in 2005. The move was complete when he sold his business in Raleigh in 2007. “I needed a job, so I bought one,” Pope said. He met with Kent Mitchell about loosening the island’s covenants so he could build a restaurant in a bedand-breakfast but wound up with the market instead. The Maritime Market is stocked like any store on the mainland with fresh produce, cheeses and dry goods. It also has a café that serves breakfast and lunch. “You never want the island to lose the charm,” Pope said, “That blend of natural environment; develop it with

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care, not let it become the next Myrtle Beach.”

LE G ACY LOOKING A HEA D

Cape Fear Station is a long way from Myrtle Beach. It also feels far away from the island’s Generator Society, but only in look, not intent. The Cosgroves sold their first house in 1999 and built a new house in 2001. The second house sold in 2013. The family no longer owns property on the island, but Cosgrove and his family still visit often. “We still love the island,” he said. “Back in the day, it was like nothing else in the country.” Paul is working to keep the island a place that still feels untouched at times, whose soul is the same as when the Cosgroves first came in the 1970s, but also a viable business with a strong home market and merchants so that the Mitchells’ plan will last for years to come. Or as Paul puts it: “Our job is to not screw it up.”

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REBOOTING

in B R U N S W I C K

BY LAURA MOORE

earthstone in Leland is an example of a neighborhood that has risen from the ashes of the Great Recession. “We brought it back from the dead,” said Shawn Horton, owner of Trusst Builder Group. “Twelve homes were built by a different builder before it was foreclosed on. We bought the property, cleaned it up and brought it back. We’ve sold over 100 homes. There will be close to 150 homes when the final phase is finished.” For Horton, ensuring the success of the subdivision,

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PHOTOS BY TERAH WILSON

situated off Lanvale Road, also meant following through with plans made by the initial developer. “The original developer promised a pool, so we went in and built a pool and a bathhouse almost right away, and we worked with the town and got the infrastructure needed,” he said. The driving factors to the success of Brunswick County’s neighborhoods can revolve around the type of lifestyle residents hope to live. Even as some developments stalled during the recession, others forged ahead in the downturn.

“Places like Brunswick Forest, Compass Pointe and St. James Plantation have that lifestyle that folks are looking for, and developers met those commitments and spent marketing dollars in our state and out of state so that more and more people come here,” Horton said. “Communities continue to pop up, and our area has grown very successfully as a result.” While 2018 comes on the heels of the Great Recession’s 10-year anniversary, the Cape Fear region has been in recovery mode. Although some real estate investors and developers lost everything, many in Brunswick County thrived despite the downturn. “If you compare our growth to other places where the growth went down, we still grew, even during the recession. We did very well in comparison to other places,” said Kirstie Dixon, Brunswick County’s planning director. Brunswick County’s population grew nearly 74 percent between the years 2000 and 2016, about 18 percent from 2010 to 2016, according to U.S. Census figures. The rapid growth – picking back up again in the recovery – plays a role in the county’s development, with many retirees choosing to move there. “Countywide, about 30 percent are over 65 years old, and only 16 percent are under 18,” Dixon said. “The median age of the county is 50.” That’s compared to the statewide median age of 38 years old. The area’s relative affordability in comparison to other states lends a hand in its popularity in spite of recession-related strife elsewhere. That’s how Sallye and Dan Neizmik ended up buying their home in the Hearthstone community. “We moved from the northwest corner of Pennsylvania, and it’s been great. It’s a great little community, and the people are really nice, very friendly,” Sallye Neizmik said. Getting the most for their money is important for those heading into retirement, according to Horton. “This area is driven by retirement and tourism. Folks take a vacation down here, they like it and they decide to retire here,” he said. “During those times (of recession) our growth hasn’t been so dependent on job creation, it has been people coming into retirement. Retirees spend less moving than they would have if the recession hadn’t hit. Instead of $500,000, they’ve spent $350,000.” w i l m i n g t o n b i z m a g a z i n e . c o m

Sallye and Dan Neizmik moved to Brunswick County from Pennsylvania after vacationing in the Wilmington area and choosing the Cape Fear region as their retirement destination.

Changes to what customers want from their communities have taken hold in the building community. The recession caused more potential homeowners to want to downsize. Generational changes also have shifted the focus of homeownership. “People want smaller lots, smaller homes. This was not planned prior to the recession but really had an effect on that,” Dixon said. “Society changed as a whole, and there’s generational changes. Millennials don’t want big lots or big houses. They are the generation that made tiny houses popular, after all. And seniors are the same way.” While single-family homes are on the rise in Brunswick County in many cases, 2 0 1 8

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apartments have also cropped up and are popular with seniors. In fact, apartment complexes slated for development already have waiting lists of one to two years in Brunswick County right now, Dixon said.

”

SOCIETY CHANGED AS A WHOLE, AND THERE’S GENERATIONAL CHANGES. MILLENNIALS DON’T WANT BIG LOTS OR BIG HOUSES. THEY ARE THE GENERATION THAT MADE TINY HOUSES POPULAR, AFTER ALL. AND SENIORS ARE THE SAME WAY. ” KI R STI E D IXO N bru nsw ic k c o unt y pla nn i n g d i re c t o r

Environmental consciousness is also trending among potential homeowners, and Brunswick County’s work with environmental groups such as N.C. Wildlife Resources Commission’s Green

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Growth Toolbox is helping to guide growth in a way that conserves wildlife and natural resources. The county’s Unified Development Ordinance encourages developers to take advantage of exceptional designs that work to encourage walkability and keep development out of flood zones. In Brunswick County, as in other parts of the area and state, residents are preferring to work and shop closer to where they live. “Zoning has significantly changed over the last 30 to 40 years. Traditional zoning separated uses and did not allow the mixture of uses,” Dixon said. “Today, we encourage a mixture of uses, so if you have a business, you may live next door to it, and we encourage new developments to have multiple housing types and commercial uses so that residents do not have to drive as far.” Although the proximity of Wilmington or Myrtle Beach is important for some homeowners, not all residents of Brunswick County demand it. As a result, growth has spread across the county.

M A G A Z I N E

“We have been able to be successful by listening to what the buyer wanted and design homes and neighborhoods based on what the customer wanted,” Horton said. “Customers did not all want to be in the same place; they wanted a variety of places. So we have spread out and covered more geography. Our business model has changed, and job sites have become more efficient, and we do a good job in different areas.” Home affordability and jobs are both issues that Dixon and Horton agree will present challenges for the county moving ahead. “Workforce housing is definitely going to be an issue,” Dixon said. “And jobs. We need good, highpaying jobs.” From the developer’s perspective, a labor shortage might play a role in any future success the county may see. The challenge “right now, is labor shortage, labor costs and material costs,” Horton said. “Our biggest goal is to maintain a good value, and if costs get too high, it gets difficult to do.”

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1 TRENDS

SUPPLY KEEPS SHRINKING

For the past several years in the tri-county region of New Hanover, Brunswick and Pender counties, the supply of homes for sale, especially at certain price points, has been shrinking. The months of supply of homes in January this year decreased to 3 months, down from

Examples of incorporating technology into new homes abound. They include everything from thermostats a homeowner can control from his or her smartphone to something as simple as building a phone or gadget charging outlet into a countertop. That’s on top of the energy efficiency measures more homebuyers are demanding to conserve energy as well as save money on utility bills.

TO WATC H

BY CECE NUNN

f the latest population growth predictions come true, the number of area residents will continue to grow at a fast pace for the next two decades at least. More residents mean more housing and more attention for the residential real estate market. The following are trends that will have an impact in the Wilmington area during 2018 and beyond:

TO TECH WITH IT

There’s no doubt potential homebuyers are searching online when they get ready to relocate or buy a new house in their current communities. David Williams, a Realtor with Century 21 Sweyer & Associates, said buyers will often already have a lengthy list of properties that they want to see that they’ve found on websites such as Zillow.com. Coldwell Banker Sea Coast Advantage is working with Zillow to buy leads to give to the firm’s agents, said company president Tim Milam. “That will allow our agents to hopefully get more leads and our Realtors to have more business coming to them that they can then go make the sales” because of Zillow’s

but may also help the Federal Reserve temper the pace of future short-term rate hikes. That’s because the slow upward creep in the broad consumer price inflation is principally being driven by rising housing costs. Simply put, more housing supply means a lower inflation rate, and potentially a slower pace of interest rate increases by the Fed,” Yun said in response to the report.

TRENDS

HOMES SMARTEN UP

3.5 months in January 2017. Lawrence Yun, chief economist of the National Association of Realtors, said the overall housing inventory in the U.S. “is currently near historic lows.” But there was a rise in January in new home construction, according to a report from the U.S. Department of Commerce. “This boost in housing supply not only helps the economy,

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enormously high online traffic, Milam said. Some local Realtors are tapping into emerging technology as well. One example: Wilmington company SISDigital firm developed and created SkyNav, a web-based immersive virtual reality tool (image above) that residential real estate firm Intracoastal Realty is using to allow potential homebuyers to experience neighborhoods in the area.

TRENDS

MORE JOIN REALTOR RANKS

The number of people who want to become Realtors typically wanes when the economy is lagging and increases when it’s strong, Realtors say. “We’ve seen a consistent growth in our real estate school. We run typically about two or three classes at a time, and those classes will have 30 people in them,” Milam said. “Go back five years ago, those classes would have had 15-20. So as the market’s gotten better, more and more people are getting in the business, and I think it’s going to continue for another couple of years.” Local real estate companies have also been expanding and adding offices in recent years.

APARTMENTS REMAIN POPULAR

As of the fourth quarter of 2017, more than 1,000 apartment units were under construction in the Wilmington area, including in various spots around New Hanover County and in Leland in Brunswick County, according to Richard Cotton, managing director of Multifamily Realty Advisors and a commercial broker who specializes in the sale of apartment communities and apartment development sites. “That’s the lowest number of units that have been under construction in the last couple of years,” Cotton said. Meanwhile, the vacancy rate for apartment communities in Wilmington was still low the last time it was measured, at 7 percent as of June 2017, according to Real Data. “It’s been pretty remarkable that we’ve gone from a market that had 10,000 units to almost 15,000 units since the beginning of 2013, and it hasn’t adversely affected occupancy,” Cotton said. “In fact, occupancy is higher today than it was at the beginning of 2013. In five years, we’ve increased the number of units in this market by 50 percent; that’s pretty amazing.” Meanwhile, apartment rental rates have continued to increase. The average apartment rental rate for the Wilmington market is now $1,023 per month, or $1.10 per square foot, Cotton said in a market update for the fourth quarter of 2017.

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REMODELING VS. BRAND NEW

As home prices rise, some people opt to remodel their home instead of trying to buy a new one. A low supply of homes also means more people are turning to the resale market, and, in turn, more are turning to the remodeling market, according to experts with data firm Metrostudy.

SMALLER FOOTPRINTS

Realtors say some buyers, from baby boomers to millennials, are opting for smaller homes. Where they might have purchased something bigger in the past, they’re choosing less square footage in some cases now. Additionally, townhomes are increasingly in demand and being added to the inventory of developments throughout the region.

MOVING FARTHER OUT

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With the opening of Interstate 140 in December providing a faster connection between Brunswick and New Hanover counties, more land will likely be used to develop more homes. That’s particularly true for hundreds of undeveloped acres in the Brunswick County town of Navassa because of its I-140 access. Meanwhile, local real estate industry experts maintain that growth will continue in nearby areas, such as the Pender County community of Hampstead, as land becomes more expensive in New Hanover.

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PROFILE

BY ALLISON BALLARD PHOTO BY MICHAEL CLINE PHOTOGRAPHY

HOUSE

COUNSEL BY ALLISON BALLARD

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M A G A Z I N E

PROFILE

T O R O N YA E Z ELL LE F T T H E M O RTG AG E I N D UST RY T O H EL P B U I L D A F F O R D A B LE H O M ES

oronya Ezell came to AMEZ Housing Community Development Corp. through her work in the banking and mortgage industry and through Price Cathedral A.M.E. Zion Church in downtown Wilmington. Although she’s from Alabama, she moved to her mother’s hometown when her grandfather was ill and needed some extra care. When he was feeling better, she stayed here, looked for a job and eventually started working full time at First Union Mortgage Corp. “I initially worked as a postcloser and then a closer for mortgage loans that were being obtained by employees of large corporations who had corporate accounts with us as a preferred lender,” she said. That was in the early 2000s. Around the same time, her pastor was also board chairman for AMEZ Housing Community Development Corp., a nonprofit organization founded 25 years ago by four local A.M.E. Zion congregations to address the need for affordable housing in Wilmington. He asked Ezell to be on the board. “I knew that the organization was doing a lot in the community to assist people in purchasing their first home,” she said. During the early part of the decade, she did what she could to help and learned more in the corporate world, eventually moving to Raleigh for a position in mortgage w i l m i n g t o n b i z m a g a z i n e . c o m

customer service. When another lender wanted to purchase the First Union portfolio, layoffs began, and soon, it was Ezell’s turn. She moved back to Wilmington and continued to work in different industry positions. She was also becoming more interested in the work at AMEZ. Linda Smith, one of the organization’s managers, encouraged her to become a certified housing counselor in 2005, in a program that consisted of counseling skills, mortgage lending, housing assistance and homebuyer education. When a part-time position opened at the nonprofit, Ezell applied. “I remember one of the first assignments that (Smith) gave me was to conduct the homebuyer education classes,” she said. “I was a little intimidated. Not because I wasn’t used to talking in front of groups of people, but providing educational instruction was different.” Ezell continued to progress through AMEZ, which has changed and expanded its focus as the community’s need has evolved. The mission is the same, though, as it was when it was started by St. Luke, Warner Temple, St. Andrew and Price Cathedral churches. The organization completed and sold its first house in October 1996, and, as of last year, the group’s tally of homes was 38. Many of the lots it has developed are on Grace Street, which is also true of the organization’s proposed 39th and 40th home, which could be built this year. “Some people don’t like the term affordable housing,” Ezell said. “But that’s what it is, and that’s what’s needed. These are homes for people in the labor force. They are medical personnel; they are teachers and law enforcement officers. Some people call it workforce housing.” The organization would like to build more homes. They just need a place to do it. “We are looking for land,” Ezell said, but it can be a challenge to find 2 0 1 8

the right affordable sites. Barriers to affordable housing are many, from an unfamiliarity with real estate and banking terminology to a lack of affordable properties where a potential homeowner’s wages could cover the costs of owning a home, she said. “What does affordable housing mean? Many people don’t understand that if a household is paying more than 30 percent of its monthly income towards housing including utilities … that they are cost-burdened,” Ezell said. AMEZ builds and renovates homes in Wilmington for first-time homebuyers who have decent credit histories, meet the income limits established by the U.S. Department of Housing and Urban Development and satisfy other requirements. Participants also complete a homebuyer education class, which is offered in person once a month and online. The organization also offers education for homeownership, financial literacy and rental issues. AMEZ has some rental units as well. Most of its work focuses on lowto-moderate earners, or those 80 percent or below median income, Ezell said. The group’s Fair Housing Education program and Foreclosure Mitigation services are offered with no income limits. Since 2012, AMEZ has helped almost 1,000 homeowners avoid foreclosure, by working with lenders and through state and federal foreclosure prevention funds. When Smith retired as AMEZ’s executive director at the end of 2014, Ezell was hired in the position beginning the following January. Ezell has been a homeowner herself for almost 15 years. “To tell you that the knowledge and experience that I gained from working in the industry prepared me for what would become the biggest purchase of my life would be a gross understatement,” she said. “I’m a believer in what we do. Homeownership is still one of the most viable methods to create longterm wealth.” R

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PERSONAL PROFILE

BUILDING

A RECOVERY

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C UST O M HOMEBUILDER DAV E S P ET R I N O S H A R ES T H E LESS O N S H E ' S LEA R N E D AND HOW H E ' S M OV E D ON FROM T H E G R EAT R E C ESS I O N B Y D AVE SPETR I N O P HO TO B Y MI CHA E L C L I N E SPEN C ER

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PERSONAL PROFILE

utting on my play clothes after school to go work on my “fort” in the woods behind our house was the best part of my childhood. I’ve always wanted to build things – I would ask for nails for my birthday, preferably 16-penny. Fast-forward to college, and it was fascinating. But I couldn’t wait to graduate and get to work – taking extra hours each semester and a couple stints of summer school. I was out early. As a business major, my courses centered around process, marketing, management and growth. Looking back, I didn’t get what I needed most: a genuine understanding as to what to do when things go bad, really bad. I’ve been self-employed since I was 19, and there have been plenty of cycles in the economy since that time. I paid attention, I asked questions and I was certain I would never repeat the same mistakes of those who had failed during those ups and downs. But no one seemed immune to the Great Recession. One could argue that our local real estate, development and construction industries took it the hardest, not just in jobs lost – thousands – but also the number of failed enterprises, bruised relationships and slashed real estate values. These days the company I founded with David Nathans in 1997 – originally Plantation Fine Homes, then Plantation Building Corp. and now PBC Design+Build with my current partner Kyle Henry – builds homes. Unlike a traditional retail business, the margins for construction companies are narrow. Beyond consumer demand you’re relying heavily on strong management, a stable pool of skilled labor and limited movement in 2 0 1 8

commodity pricing. A few percentage points in the wrong direction, and you end up working for free. Prior to 2009, it was understood that a change in market conditions would affect our business, but we believed we were well-prepared for a downturn, certainly nothing that couldn’t be managed. Our assumption was flawed, as our overhead extended well beyond our gross profit and as real estate values reset. I learned that a bank can ask for more money against an existing loan to keep their ratios in balance. Actually I learned a lot more than that in 2009 – new words like “compliance,” “forbearance” and “curtailment.” While I was fortunate to avoid words like “insolvency” and “bankruptcy,” I can fully articulate the differences between Chapters 9, 11 and 13. I’m grateful to look back with relief, and our approach is dramatically different today than that of a decade ago. Construction and real estate are very broad descriptors. Wilmington is a small town, and we spent years trying to be everything to everyone – commercial, development, multifamily, remodeling and custom homes. Today PBC Design+Build is a custom homebuilder serving the Wilmington region. That’s it. We are still presented with many opportunities to diversify, but by politely declining, it makes it that much easier to fine-tune our processes and concentrate on what we do well. There hasn’t been a time in history where homes were ever more complex. It goes beyond government regulations and the building code. It means understanding how homes are built and what it takes to make sure a decision on day 14 doesn’t have a negative consequence that may not materialize until months (or even R

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HIGH PERFORMANCE LAW™

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years) later. I get asked daily about our local market, about interest rates. Like a bunch of others in the real estate business, I guess we’ve unceremoniously become somewhat of a bellwether. I predict the next correction won’t be as bad as the last because guys like me (hopefully) matured to the point of some restraint and constant reality checks – something I lacked more than a decade ago. But there will be a correction, and for those who have prepared, the opportunities will continue to materialize, and others will not be as fortunate. I don’t know exactly what will cause the next correction, but I can tell you what keeps me up at night: There are a lot of moving parts that touch the costs associated with construction. Regulatory and environmental challenges, immigration, lack of truly skilled labor and an aging pool of business owners whose children aren’t necessarily going to follow in their parents’ footsteps. Affordability is going to get worse as well, and it will become more noticeable as both interest rates and hard costs rise. Homes are the very last consumer product that is completely handmade. I believe we’ll see more efficiencies in construction like those we see in Europe and Asia where walls are massproduced and assembled like a kit. You’ll still see housing built, but fading will be the thought, character and emotion that comes with the art of design and the talent of a tradesman. Feeling completely safe or immune to the next set of challenges in the economy isn’t likely to occur, but we do enjoy a maturity that only comes from experience. We step back more often than we like to retool or readjust one of our processes – it’s not perfect. It will never be perfect – but it will be great. Dave Spetrino is president and founder of Wilmington-based PBC Design+Build.

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513 S. LUMINA AVENUE, WRIGHTSVILLE BEACH

4,475

286 BEACH ROAD N., FIGURE EIGHT

3,370

$4,250,000 $3,900,000

PRICE

ADDRESS

SQ FT

$3,625,000

26 PIPERS NECK ROAD, FIGURE EIGHT

4,088

6 SOUNDS POINT ROAD, FIGURE EIGHT

4,500

86 BEACH ROAD S., FIGURE EIGHT

9,105

334 CABBAGE INLET LANE, WILMINGTON

7,080

1120 HARBORWAY PLACE, LANDFALL

11,262

$3,500,000 $3,500,000 $3,295,000 $3,200,000

SOURCE: N.C. REGIONAL MULTIPLE LISTING SERVICE

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BY VOLUME

SIDES*

VOLUME $

AVERAGE $

5,213.5

$1,275,892,349

$244,729

3,033

$1,046,030,394

$344,883

1,613.5

$345,825,624

$214,333

RE/MAX ESSENTIAL

1,447

$342,373,155

$236,609

KELLER WILLIAMS REALTY

1,433

$326,774,597

$228,035

BLUECOAST REALTY CORP.

649

$159,878,744

$246,346

COASTWALK REAL ESTATE LLC

518

$146,733,269

$283,269

LANDMARK SOTHEBY'S INTERNATIONAL

258

$124,566,558

$482,816

MARGARET RUDD & ASSOCIATES

580

$116,714,390

$201,232

RE/MAX AT THE BEACH

486

$102,692,808

$211,302

BRUNSWICK FOREST REALTY LLC

353

$97,977,126

$277,556

COASTAL PROPERTIES

396

$88,291,734

$222,959

306.5

$80,080,622

$261,274

141

$72,579,250

$514,746

321

$62,457,848

$194,573

COLDWELL BANKER SEA COAST ADVANTAGE

2 3

INTRACOASTAL REALTY CENTURY 21 SWEYER & ASSOC

4 5 6 7 8

TOP15

RESIDENTIAL

REAL ESTATE FIRMS

MARKET SNAPSHOT

10 11 12 13 14

D.R. HORTON INC WENDY WILMOT PROPERTIES

SOUTHPORT REALTY INC

SOURCE: N.C. REGIONAL MULTIPLE LISTING SERVICE FOR NEW HANOVER, BRUNSWICK AND PENDER COUNTIES IN 2017

* SIDES COUNT THE BUYING OR SELLING SIDE OF A REAL ESTATE TRANSACTION

Mosquito Protection Specials The original and most trusted mosquito eliminator for over 10 years.

Call The Squad Now for Discounted Season Packages

910-791-9800

or visit MosquitoSquad.com

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LOCALLY OWNED

& Operated

2 Introductory Treatments 1/2 acre or less

139

2 Introductory Treatments 1/2 to 1 acre

First time customers only. Limit one coupon per property. Excludes event treatments. Expires 10/31/2018.

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TOP20

RESIDENTIAL

SOURCE: METROSTUDY, A HANLEY WOOD COMPANY, BASED ON RECORDED CLOSINGS IN PENDER, BRUNSWICK AND NEW HANOVER COUNTIES, BUT NOT INCLUDING CLOSINGS UNDER ASSUMED NAMES, SPECIAL ENTITIES OR LIMITED LIABILITY COMPANIES WITH DIFFERENT NAMES.

1 2 3 4

2017 CLOSINGS

DR HORTON 253

317

BILL CLARK HOMES 138

152

CP BRUNSWICK LLC 70

107

WADE JURNEY HOMES 79

100

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90 111

96 LOGAN HOMES

72 TRUE HOMES

68 PULTE GROUP

57 MCKEE HOMES

STEVENS FINE HOMES

2017 CLOSINGS

H&H HOMES

HOMEBUILDERS

2016 CLOSINGS

RESERVE DEVELOPMENT CO. 22

SOUTHERN HOMEBUILDERS

M A G A Z I N E

2016 CLOSINGS

13 14 15 16 16 16 19 20

2017 CLOSINGS

PYRAMID HOMES 40

TRUSST BUILDERS 70

MUNGO COMPANIES 15

RIPTIDE BUILDERS 44

SEVENTY WEST BUILDERS INC. 31

A SYDES CONSTRUCTION 17D

HARDISON BUILDING CO. 27

GREENHOUSE PROPERTIES 20

TOP15

MARKET SNAPSHOT

AGENTS BY VOLUME for

NEW HANOVER, BRUNSWICK & PENDER COUNTIES

KEITH BEATTY, INTRACOASTAL REALTY CORP.

VANCE YOUNG, INTRACOASTAL REALTY CORP.

JERRY HELMS, BRUNSWICK FOREST REALTY LLC

SIDES*

VOLUME $

6 321

137.5

338

$104,737,654

$96,475,371

$94,793,276

HANK TROSCIANIEC & ASSOC, COLDWELL BANKER SEA COAST ADVANTAGE

SIDES

VOLUME $

207.5

$44,195,674

BUDDY BLAKE, RE/MAX ESSENTIAL

202

$43,887,834

KBT REALTY TEAM, KELLER WILLIAMS

175.5

$43,041,070

$39,504,646

JESSICA EDWARDS TEAM, COLDWELL BANKER SEA COAST ADVANTAGE

KIM ANDERSON, ART SKIPPER REALTY INC.

207

$39,117,845

BUZZY NORTHEN, INTRACOASTAL REALTY CORP.

35.5

$36,463,813

MICHELLE CLARK, INTRACOASTAL REALTY CORP.

$35,676,699

JUSTIN DONATON, COASTWALK REAL ESTATE

78.5

$33,931,878

TEAM HARDEE HUNT & WILLIAMS

$59,257,638

SHAWN HORTON, COLDWELL BANKER SEA COAST ADVANTAGE

$29,307,933

CARLA LEWIS, INTRACOASTAL REALTY CORP.

$50,269,732

FRANK SHERRON, LANDMARK SOTHEBYâ&#x20AC;&#x2122;S INT. REALTY

60.5

$29,018,901

* SIDES COUNT THE BUYING OR SELLING SIDE OF A REAL ESTATE TRANSACTION

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SOURCE: N.C. REGIONAL MULTIPLE LISTING SERVICE

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LITIGATION CONSTRUCTION DISPUTES MEDIATION/ARBITRATION/COLLABORATIVE LAW REAL ESTATE DEVELOPMENT & ZONING EMINENT DOMAIN & CONDEMNATION LICENSING DISPUTES CONTRACT DRAFTING TITLE INSURANCE BANKING LITIGATION LIENS

SERVING BUSINESS AND CONSTRUCTION PROFESSIONALS IN North and South Carolina | (910) 777-5995 | www.hamletandassociates.com

PATRICK PUNZALAN Auto – Home Motorcycle – Renters

Agent

910-799-9565 – PaPunzalan@geico.com 140 HAYS LANE, SUITE 130, WILMINGTON, NC 28411

Siegel & Rhodenhiser, PLLC

STEVE SIEGEL

RYAN RHODENHISER

Distinguished Rating by Martindale-Hubbell for 27 consecutive years

2018 Rising Star in Real Estate Law by Super Lawyers Magazine and 2017 Legal Elite in Real Estate Law by Business North Carolina Magazine

Real Estate, Business, and Estate Planning Attorneys 1426 Commonwealth Drive, Suite B, Wilmington, NC 28403 (910) 256-2292 | www.coastallawyer.net

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THE TAKEAWAY

HOME STEEL HOME

photo by MEGAN DEITZ

Come June, this 20-foot shipping container could be someone’s living room. Part of The Cargo District on Queen Street, it marks one of nine converted container homes – two-story, one-bedroom units that rent for $1,050 including utilities. It’s part of a larger vision, said Leslie Smith, owner of L.S. Smith Inc. and The Cargo District developer, shown here at the beginning of the renovations. The hope is to build 50-70 more (larger, two-bedroom units) alongside office and retail offerings.

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TURN PAGE HERE FOR COMMERCIAL REAL ESTATE

Multi-room intercom Home Networking Home Theater

Structured Wiring (Phone, Cable, and Internet)

System Automation

Automated Lighting Controls

ACOUSTICREATIONS.COM

910.371.2038 sales@acousticreations.com

HD Video Conferencing

Multi Room & Hi-Fi Audio

Commercial and Residential Audio-Video

FROM YOUR OFF IC E, TO YOUR HOME.

I FF

TURN PAGE HERE FOR RESIDENTIAL REAL ESTATE