LEXINGTON, SC — One of the first new large-scale subdivisions in the Midlands since the pre-recession housing bust is in the planning stages for Lexington County just off Interstate 20.
Barr Lake Development has assembled a massive 320-acre swath of undeveloped countryside for the project, which won’t be ready for the first home construction until fall 2014, real estate officials said.
The subdivision will be a single-family, 450-house residential development around Barr Pond, a 100-acre reservoir and former longtime fish and recreation public preserve two miles south of Lexington.
The proposed development essentially would be carved out of wilderness off I-20 north of the sprawling Michelin tire plant between Industrial, Wildlife and Barr roads.
In addition to the 100-acre pond – said to be the second-largest waterway in Lexington County – the subdivision, which has not been publicly named yet, is to take advantage of the preserved rural topography by featuring nature trails, recreational areas and a clubhouse.
The homes will fall into a mid-level price range from $200,000 to $500,000, developers said, and provide 1,800 to 3,000 square feet of living space.
The new subdivision, planned just north of Lexington Country Club, would join a myriad of subdivisions that have sprung up on Barr Road over recent years – though none lately in the ever-thriving Lexington area, or elsewhere in the Midlands since the Great Recession.
Month in and month out, Lexington County has registered the state’s lowest unemployment rate for several years.
But the strength of the last recession knew no boundaries.
“This proposed development should be considered an exception to the rule, in that there had been fairly few new developments being proposed as to the scale of this one,” said Earl McLeod, Home Builders Association of Greater Columbia’s executive director.
Other such new housing developments of comparable size are in the planning stages, McLeod said, though those projects will all be subject to financing availability.
“That has been a hindrance in terms of new residential developments,” McLeod said.
New homes built by a multitude of builders have sprung up in more than a dozen subdivisions existing along Barr Road between the country club and the proposed new development, including Hampton Park and Southberry Park, joining established neighborhoods such as Turnberry Place and Greenside.
Those new homes, particularly since the housing bust, almost exclusively are the result of builders purchasing finished lots in those subdivisions, building speculative homes on the lots and then selling them, said Nick Stomski, NAI Avant broker, who facilitated the land assemblage for the new project.
No significant new subdivision infrastructure has been put in those existing subdivisions, he said.
“This is one of the first projects where we’ve seen truly a start-up subdivision being contemplated and going through toward execution” since the recession, Stomski said.
Four parcels were put together to make the project a go, he said, including 179 acres purchased from Harmon Properties, 124 acres purchased from the Town of Lexington, which includes Barr Pond, 13 acres purchased from SCE&G, and 1.1 acre purchased from another individual, Stomski said.
“We saw demand from the time the developers put the initial 179-acre development site under contract,” Stomski said, noting that will be where the bulk of the 450 residential sites will be located in the new subdivision.
The developers, Barr Lake Development Group, will develop the house lots to build-ready status, then sell them to the builders who will construct homes and sell them, Stomski said.
Three selected builders will work with the developers building in phases, Stomski said, but he declined to identify.
“What’s unique about this is the amenity of the 100-acre lake that is part of this property,” Stomski said. “There will be walking trails through 50- to 60-year-old pines and hardwoods.”
Forming the project was not without some controversy.
The Lexington Wildlife Club had used the pond on site for more than 50 years as a recreation and educational preserve for children prior to the sale of the property, when they lost that access. The Town of Lexington, which owned that acreage, purchased it in 1997 for $5 as a backup water source, but didn’t need it, town officials said, and sold it for $60,000.
Some complained the land and pond was worth a lot more, and others berated town officials for selling acreage from under the Wildlife Club. The Wildlife Club has since found new digs.
Business methods for building large-scale subdivisions have changed since the U.S. housing collapse and ensuing recession.
Few if any new subdivisions have come online in the area since 2009, and Stomski said there has been a lapse in the number of build-ready lots available to contractors to build new houses.
“There’s been a shift,” he said. Builders used to buy vacant land, put in infrastructure (water, sewer, roads, off-site detention) build houses and sell them.
“Since the downturn, that has transitioned into a third party developer coming in taking down the land, putting in the infrastructure, then selling (the finished lots) to the builder to build homes,” Stomski said.
That practice clears up needed capital builders must have in order to build up inventory and extend market territory, Stomski said.
When the downturn hit in 2007-2008, builders were sitting on large tracts of land they intended to use for homebuilding. But with new building and sales having grounded to a halt, builders’ capital was consumed during the recession by the various costs of land ownership, Stomski said.
There also was a backlog of finished lots already on hand at the time of the collapse, and as those lots have now slowly been consumed by the market comeback, creating an opportunity for developers to fill the void.
“I would say that in the Columbia area, we’re looking at a pending lot shortage – a shortage of developed lots,” said McLeod.