We took a family vacation to West Texas when I was a kid, hitting highlights such as Big Bend, Indian Lodge, and Fort Stockton. The most memorable stop for me was the McDonald Observatory. It was so cool to check out the gigantic telescopes that were capable of getting an up-close view of stars, planets, and even galaxies.
So you can imagine how excited I was to see this Squaw Valley listing from Ascent Sotheby’s International Realty. You guys, not only does this $9 million listing have some of the best views in the Edwards, Colo., area, but IT HAS ITS OWN OBSERVATORY.
I just can’t get over how cool that is! Imagine having a home that sits out in the middle of mountain country, where there are no streetlights to obscure your view of the sky. Sounds almost like touching heaven, no?
Imagine the things that will pop up in conversation that you’d never imagine would.
“Honey, did you close the door of the observatory dome? It might snow.”
“Dear, I think I might have just discovered a new planet!”
Of course, you’ll also love that this home is fully automated and can be controlled via an app on your smartphone. You also get tons of windows from which you can view the changing seasons on your mountain-top hideaway on more than 34 acres. There are five bedrooms, six full and two half baths, and an indoor tropical greenhouse where you can grow your own tomatoes year round inside this 10,561-foot compound. Brilliant!
3RD Home (see ad to right) is a web site for second home owners that expands second home ownership by creating a home swap of vetted vacation home owners and properties. It’s like belonging to your very own Exclusive Resorts, only more exclusive. You must already be a second home owner — condo, home, ranch — and then you can exchange your home to stay at a THIRD home for — are you ready? $495 a week. That is not a typo. It costs you $495 to join 3RD HOME, and then $495 per week per stay at a home that matches the value, categorized as keys. I might add this must be full home ownership on your part, no family timeshares like our beach house. All the homes and owners are scrutinized so you know you are not just getting a five star location, you are putting nice people just like yourself in your property.
The genius behind this Nashville, TN -based company (The Southwestern Company is a partner) is Wade Shealy, a veteran second home Realtor who earned his stripes selling vacation homes in Hilton Head, South Carolina.
“I sold out my last development in 2006 – Hampton Island off the coast of Georgia,” says Wade. “Uber hot when Ben Affleck bought a home on Hampton Island.”
What did he see coming down the pike? People needing second homes like they need a colonoscopy.
“I was sitting, waiting for it to turn around, and I waited. And waited, ” says Wade. “So I started looking at options for owners to get more value from those homes.”
Truthfully, the second home market is doing better, but not as well as the primary market. According to the latest NAR research,
The median vacation home purchase price was higher in 2012 than in 2011–$150,000.
The share of vacation buyers who did not use a mortgage rose slightly to 46 percent from 42 percent in 2011.
Since there were fewer distressed properties on the market in 2012, there were fewer that could be purchased. The share of vacation buyers who purchased a vacation property dropped to 35 percent from 39 percent in 2011.
However, the share does remain high—20 percent of vacation buyers purchased a home in foreclosure, while 15 percent purchased a short sale.
Vacation buyers expect to own their vacation home for 10 years.
More second homeowners are leasing vacation homes for cash flow, and a Realtor I spoke with in Phoenix recently, Walt Danley, told me pre-retirees are buying homes in Phoenix and Scottsdale, for example, at devalued pricing, leasing them and holding them for retirement in 5 to 7 years. Of course, many of them are snowbirds and I hope they can unload those primary homes.
But when you have a second home, when you are dishing out $7000 a month in mortgage, insurance and other second home housing costs, the last thing you want to hear is “let’s go skiing this year” when you own a home at the beach.
But with 3RD HOME, you can trade the beach house for a ski chalet for $495. per week. It’s a way to stretch the vaca home to more than one location without breaking the bank or — horrors — buying another vacation home.
In fact, 3RD Home is more than a home exchange, it’s an estate exchange.
“Its proprietary key system puts you in control,” says Steve Zacks at 3RD Home. “You earn credits, called Keys, each time you make a week in your second home available for other members use.”
With those Keys in hand, which serve as the currency in the 3RD HOME system, you then can immediately reserve any available property and week 24/7 online. There is no direct or simultaneous exchange required with another member.
What makes 3RD HOME truly unique and superior is the quality of the homes made available for your use. There are more than 1550 homes spanning the globe with an average value of $2.25 Million and many well above $5 to 10 million. An example is this gem located in Argentina named La Fortuna. A complete description of this luxurious estate can be found on the 3RD HOME website. And yes, it’s ready for a swap!
SecondShelters.com welcomes its newest expert contributor, Dallas Addison, who really IS from Dallas, Texas!
My name is Dallas Addison, and my passion is real estate. I’m trained as a lawyer and have helped many clients throughout the country buy, sell, develop and manage all types of real estate over the years, with a particular focus on recreational and hospitality-based real estate, such as golf courses, resorts, ranches, second homes, etc. I’m also a founding principal of Preservation Land Company, which has created several incredible (if I may say so) conservation-based recreational ranches near Dallas and worked on projects in Montana, Hawaii and New Mexico. On the educational side, I’m a long-time member of the Recreation Development Council of the Urban Land Institute, a global organization of leaders in the real estate industry whose mission is to provide leadership in the responsible use of land and in creating and sustaining thriving communities worldwide.
I will be sharing with you interesting, exciting things that are going on in recreational real estate (which we’ll broadly define) across the country. We think it’s important to know that your source is not only reliable but actually 100% involved in the recreational real estate industry.
I also have a strong personal interest in how sustainability concepts are applied in recreational real estate. While completely overused, the concept of sustainability still has merit. Locally, it’s darn hot here and by the looks of our rapidly dropping lakes, we’re using lots of water. Plus, our area is quickly growing, one way or the other, putting even more stress on our resources. We should be looking to make choices that create better and more livable communities. So, where I see interesting and innovative sustainability practices being applied, I want to share those as well. Hopefully those ideas will take root and help us manage the growth without depleting our resources.
Finally, how did I connect with Candy? Well, interestingly, her husband unexpectedly delivered our first daughter, but that’s not actually how we met. We bumped into each other years ago as we share a passion for real estate. She came out to visit one of our projects, Cross Pines Ranch, near Mineola. We’ve had many interesting conversations about what’s going on in this space and we thought others might want to listen in on the conversation.
Stick around, and I think you’ll enjoy the ride. We will be having the Aspen report, just in time for ski season, new news out of Hawaii’s Big Island, and one of my favorites: Cross Pines Ranch near Mineola, pictured here. Come back, come often, and join the discussion!
And if they have to cover naked beaches with shipped-in sand, or grind down glass to make it, that cost could even go higher.The most expensive waterfront properties in the world are on Italy’s Lake Como, about 30 miles north of Milan. I have been to Lake Como and know full well why. Next is Barbados followed by Phuket in Thailand and central Algarve along Portugal’s southern coast.
“It’s the first question I ask people, ‘Do you want waterfront or lake views?’ Generally speaking, if you can’t see the water, people are not interested,” Mr. Fawcett says. “I’ve had people who have been looking for three, four, five years, but they’re all happy to bide their time. These people appreciate that it’s a rare commodity to get a true waterfront property.”
In the U.S., waterfront properties sell for 60% more than non-waterfront homes in Miami, according to Knight Frank. According to Audrey Ross, senior vice president of Esslinger Wooten Maxwell, an affiliate of Christie’s International Real Estate, sometimes waterfront properties can sell for more than a 100% premium, — double the price of a non-waterfront equivalent.
“The premium goes directly to how high the water is and how wide the views are. Basically, the bigger the view, the higher the price,” she says.
Families with small children may not find waterfront homes desirable, though I always found the vast beach much safer than a swimming pool when my children were babies. They can toddle on a beach, built sand castles, dabble in the water without venturing in too much. Mine were afraid of the surf until they were old enough to be strong swimmers. .
Most investors think buying a waterfront property is like buying gold bars, but there are also expenses involved: higher insurance costs for hurricane and dredging, which municipalities usually cover but turn to taxpayers to fund. There are also tsunamis, which we experienced in a very small way last year in Hawaii when the Four Seasons Kona was evacuated. (This shot was taken right after the water receded.)
Miami is great, but did you know Miami Beach is running out of sand? For many years Miami Beach replaced sand lost to hurricanes and tides by simply pumping it from the ocean floor, which is what most beach communities do. But by 2001, because of the area’s geography, that ended. There are three reef tracks running alongside Miami-Dade and Broward Counties, which make dredging difficult. The continental shelf also narrows greatly here, meaning the ocean gets too deep too quickly.
Possible solutions include buying sand from nearby St. Lucie, Martin and Palm Beach counties, who have said no, saving their sand for their own beaches. Miami could also buy sand from the Bahamas or Mexico, and ship it in at a hefty price. They are also looking at making sand out of recycled glass. Yes, at one time sand was used to make glass, so this is a simply a reversal process:
Broward County is exploring the cost of recycling glass to fill small gaps in its beaches — it is more costly than offshore sand, but it is not yet clear by how much. Broward would also have to find a nearby facility to process the glass and complete the final phase of its environmental study. Other states have used recycled glass, but mostly for small projects like golf courses.
For now, the idea remains on the table. It is creative, said Ms. Jacobs, the Broward County mayor. It could promote a market for glass, she added.
Broward is looking to finance the last part of its environmental study, and will weigh the costs. The sand has so far proved an excellent mimic of regular sand, which is used to produce glass, after all. “If we could generate our own sand,” Ms. Jacobs said, “it would be fantastic.”
It’s the most talked about second home resort in the western world, located on a shimmering Bahamian beach dubbed the new French Riviera.
Baha Mar is a $3.5 BILLION mega-resort under construction now in Nassau, The Bahamas. Thousands of construction crews are working around the clock, working so diligently they add one full story to the hotel towers every ten days. It is the largest resort under construction in the Western Hemisphere and has been described as Vegas with 3000 feet of beach.
Here’s how majorly buzzed this resort is: I was at a national real estate editor’s conference, talking, actually, to the developer of another major resort in the Caymans. I mentioned that I had visited Baha Mar and was very impressed. Her eyes grew wide.
“You should be,” she said. “Everyone knows about Baha Mar, everyone is watching it. Even developers think it will set total major new standards of luxury in the Caribbean resort world.”
And this came from the competition!
Such a development is the colossal Baha Mar mega-resort. The $3.5 billion, yes, with a “B” project is set on 1,000 acres of prime beach front paradise and will soon become one of the world’s largest, most luxurious resorts with everything jet-setting second home owners who love water could desire, and then more.
And then, even more!
The total square footage of the development is expected to hit 3.3 million, with every square inch devoted to luxury. Baha Mar will open formally in December, 2014. There will be four hotels including a luxury Grand Hyatt, Rosewood, and Mondrian and the Baha Mar Casino & Hotel. All of the hotels will surround a 100,000 square foot casino that promises to combine the best of Las Vegas and Monte Carlo. Jack Nicklaus himself is directing construction of a brand new 18-hole Nicklaus Signature golf course. The resort will include 40+ luxury retail stores, 30+ restaurants, bars and nightclubs all set on one of the world’s most spectacular beaches.
Baha Mar is selling 284 private residences total for everyone’s taste. There will be one bedroom condominiums to three bedroom penthouses, and four bedroom total beach villas all overlooking miles and miles of sparkling clear, aqua blue ocean.
Perhaps the best news yet: the lift will be so convenient, you will practically land at the resort. Seriously, Baha Mar has already invested in building more than $250 million new tree-lined boulevards that will connect the resort to Nassau’s sparkling new Lynden Pindling International Airport with only a 10 minute ride. Lynden Pindling is the largest airport in The Bahamas, and was recently enlarged even more. If you fly private, you can depart the mainland and be on the beach by ten. Fly commercial, you can early-bird it from DFW via Miami in the morning, and be on the beach by afternoon.
One of the most interesting facts about this ambitious development is how it is leading the Bahamas out of the worst recession since The Great Depression.
In April 2005, Lyford Cay-based property developer Sarkis Izmirlian put together the newly-formed Baha Mar Development Company and purchased three aging dowager hotels on Nassau’s Cable Beach.
Baha Mar Development worked closely with the Bahamian government and put together plans for a multi-billion play world on Cable Beach that would include private residences, hotels, a casino, retail village, convention centre, state of the art expanded and enlarged golf course, plus of course beach and pool amenities.
But, then, the perfect storm: The U.S. housing market came crashing down, with Europe to follow, like a twin domino.
March, 2009. I remember the mood well, even in “we escaped-the-recession” Texas. (Yes, the tee shirts exist.) Real estate was glum, depressing, and no one was moving unless they absolutely had to or were carried out of their homes feet first. Banks were as dry as the the Sahara.
Baha Mar, rather than folding the tent, looked east for it’s fortune, to the cash-rich Chinese government.
That’s where the magic happened.
China’s Export-Import Bank agreed to arrange $2.5 billion in construction financing and the China State Construction & Engineering Company (the largest construction company in the world) signed on to build the project. The plan called for Baha Mar to feature four luxury hotels and add 2,200 hotel rooms and condos to the country’s current inventory.
By supporting Baha Mar’s development, the Bahamian government created 4,000 more Bahamian jobs, $400 million in Bahamian construction contracts, and $8 million for training Bahamian workers. After all, white glove hotels were coming in and the staffs needed detailed training to kick service up a notch or so..
Bahamian firms got their contracts, and the China State Construction & Engineering Company got to work. The developer also covered the cost of a fancy new electrical substation, built a central sewerage system, and even a reverse osmosis plant for potable water. Massive on-site generators guaranteed to keep the resort juiced up even after a storm for several weeks. Then the developer did even more economic hand-stands: when work on the $75 million road to the airport, named “JFK” by Bahamians, was stalled and slowed, Chinese workers pitched in and helped to finish it. Despite the Cuban Missile Crisis and the Cold War of yesteryear, this part of the Caribbean likes Americans enough to name a major street after an American president.
Why do you want this second home resort development on your radar?
If you are considering a second home for purchase in a beautiful beach environment, this is it, baby. Buy now or keep Baha Mar on your radar. 284 residences are available for sale, starting at about $1.2 million, each with a killer water view. Baha Mar has the magic of great climate, sunshine and surf which means if you buy here, you will enjoy the water every day and every day will be like, well, vacation!
“The views are endless,” says Tom Dunlap, president of Baha Mar Development. Dunlap cut his teeth at Walt Disney Co. as vice president of Imagineering, then built a few billion dollar plus resorts in California and Costa Rica. Now he’s the man in charge of constructing every molecule of the resort from 9,000 sheets of drawings!
It is in the design of Baha Mar where you most see the fingerprints of world-class developer Sarkis Izmirlian. Izmirlian’s charge to the teams of architects and designers was to create a place that provided all of the luxuries anyone could imagine in a five-star resort, but preserve the authentic look and feel of the Bahamas. Like the waterfalls and brightly colored stucco buildings that pop out and make you feel brighter just from the ocular jolt. Bahaman art will be proudly displayed and promoted.
“Fads and trends will come and go,” says Izmirlian, “but when you are true to your surroundings, that will never go away.”
When you see the design of Baha Mar, the entire development looks and feels like the Bahamas. When you get a look at the uncompromising luxury of the finishes in the residences, your reaction is that someone really was very careful, thoughtful, almost obsessive about how they planned Baha Mar, as if they were matching the perfect weather.
“It’s absolutely beautiful (in Nassau) every day, ” Dunlap told The Bahamas Investor. “When you build these great resorts, it’s kind of like building a stage set. We are in a location where the people have been in the hospitality business for a long time, and understand the importance of our guests having a wonderful time.”
Baha Mar is becoming the poster child of a development that is doing everything RIGHT: the sophistication and solidarity of the developer, the construction genius of Tom Dunlap, a $3.6 billion USD infusion from China, and top brand names of the major hospitality players committed: Grand Hyatt, Rosewood and Mondrian.
Dunlap says Bahamas buyers tend be 80% American, and 10% each Canadians and Europeans. Baha Mar, just this month, began marketing in the United States so you will likely begin seeing and hearing much more about the resort. Baha Mar is also attracting an international jet-setting crowd with purchasers from Europe, Asia and the Middle East. Because of the generally low cost of living in the Bahamas and the virtual absence of property or income taxes, the Bahamas has become one of the world’s top retirement meccas as well as a jet-setter playground.
While some second home purchasers are interested in a resort like Baha Mar because of the rental income a popular resort property can provide, most are looking for a place to create family memories in one of the world’s most beautiful water and natural marine life havens. They want expansive beach front, plus clean, sparkling warm waters, perfect weather and activities 24/7 the moment they arrive. That could be swim, snorkel, scuba, sun and jet ski, or it could be boat rides to explore private islands, lolling on a yacht, golf on signature courses, tennis, fitness, spa, arts and theater.
And always, of course, shopping for the glamorous nights at the casino.
“The affluent buyer is no longer focused on zip codes,” says Laurie Moore-Moore, a Dallas-based real estate consultant at The Institute for Luxury Home Marketing. “The uber wealthy have become a tribe unto themselves where they find each other through common activities. They want stories and experiences, not just products.”
“This is a group that has become less local, far more global,” she says. “They find themselves through Wimbledon, The World Cup, Monte Carlo, Concours d’Elegance at Pebble Beach, sailing and great beaches.”
“We have new infrastructure, increased airlift and transportation,” says Tom Dunlap. “With the level of public infrastructure and private investment, I believe Baha Mar and The Bahamas are perched to hit a home run when we open in 2014.”
Home run? After my recent visit to the Baha Mar construction site and teases of the housing to come, I’d say it’s out of the ballpark!
Corpus Christi, Rockport, Port Aransas, Mustang Island
What are fabulous Texas Gulf Coast destinations?
Yes, that’s correct! These are all great cities and places on the Texas coast that are quick, accessible getaways that won’t break the bank. We’re talking about towns full of culture, history, and wildlife. Great places with tons of things to do, with great restaurants, fantastic fishing, and the laid-back Gulf Coast vibe.
We’ve picked five properties that are available now in this area, and if we could, we’d be spending this long weekend at any one of them!
Then there are vacation homes often owned by high net worth individuals who just want to be done with them. Well, guess who has jumped in to help? Our friends over at Heritage Auctions in Dallas, Texas. Heritage also has galleries in New York City, San Francisco, and Los Angeles. Did you know that Heritage has slipped right up on Sotheby’s and Christie’s (and, some say, moving up on) to become the world’s third largest auction house? Now the venerable art and collectibles auctioneer has announced the addition of Luxury Real Estate auctions to its growing portfolio of 30+ Auction categories.
The Heritage folks are so smart: not only will this net them more fine art and collectibles to sell, it will net them the very dirt and walls that surround all that stuff like, for example, the contents of Champ. Brilliant stroke!
Unlike traditional real estate listings, sellers with Heritage Luxury Real Estate Auctions work with the team to maintain control over the entire sale, setting the date, marketing strategy, and terms of the auction. Relax agents, that team includes YOU. Selling at auction, of course, creates a competitive bidding environment, where fully-qualified and motivated buyers participate in a transparent, non-contingent sale — all within 60 to 90 days’ time frame from beginning to closing.
Do not, repeat, do not confuse auctions with foreclosures. The Luxury Real Estate auction format accelerates the selling process, creates a sense of urgency with buyers and eliminates carrying costs while the vetting process brings in something every Realtor would kill for: fully qualified buyers.
Experts tell me that homes that sell at auctions are homes that are simply not going to sell the traditional way: list, sign, MLS, wait for buyer. They may be too specialized, or overbuilt, or in the wrong location, or the sellers have grown tired of waiting. (Sound like Champ?) But never mind all the negatives: if a home is highly desirable and you can get a lot of people excited about it in a short, defined period of time, and you market the bejesus out of it, you can sell it.
More and more sellers, in fact, are coming to auction houses first so they don’t have to hassle with the time and inconveniences associated with listing a property the traditional way.
The Directors of the new Luxury Real Estate category are Nate Schar, who will be working from San Diego, Scott Foerst in Atlanta, and Amelia Barber, holding down the fort in Dallas, where Scott and Nate spend half their time anyhow. Scott and Nate have a 13 year history of selling multi-million dollar properties by auction throughout North America totaling more than $250 million in sales. Previously, Nate was an asset manager at one of the Midwest’s top wealth management firms, and Scott served as architect and senior project coordinator with both commercial and residential construction firms in the Southeast. Both came to Heritage from — surprise! — Grand Estates Auctions. Amelia comes to Dallas by way of The Hill as in Washington, D.C. where she was a lobbyist. Amelia also managed operations for a national financial trade association.
“Heritage is the first fine art and high-end collectibles auctioneer to offer Luxury Real Estate auctions in this specific format, a perfect fit with our portfolio of services catered to high net worth individuals,” said Paul Minshull, Chief Operating Officer of Heritage Auctions. “These auctions will put the seller in control and provide liquidity in a timely manner.”
The properties presented by Heritage Luxury Real Estate Auctions will be marketed with customized advertising plans regionally, nationally and internationally, including Heritage’s 750,000+ bidder members from more than 186 countries. (How do you spell high net worth? HERITAGE.) The auctions will be marketed out the wahzoo to qualified buyers.
“Our sellers are finding this process a tactful and savvy means of resolving their traditional selling dilemma,” said Scott. “Auctions help maximize the full market potential of Luxury properties.”
So I asked Nate, Scott and Amelia: will this be vacation or primary homes?
“Vacation properties about 80% of the time,” said Nate, “There’s a lot of vacation homes out there and available, thus more inventory to sell.”
Many of those homes are free and clear with zero mortgage debt. Heritage will not be selling private planes and yachts, at least not at this time.
But there will be some primary residences in the pool. The trio plan 18 to 24 auctions per year, with the first one set to rock and roll this fall. I’m off to Maine next week — I’ll take this one!
You know Airbnb, yes? The sassy vacation rental site that let’s homeowners earn extra money off their homes by renting them out on a short term basis. I had the pleasure of hearing the founders speak two years ago at Inman in San Francisco. They started the concept when they were living in San Francisco, essentially, broke, and made short term cash fast by leasing out their apartment like a hotel. Bingo, a new concept was born.
Only New York City has not proven as friendly to the Airb&b concept. AOL Real estate reports NYC has “effectively deemed the vacation rental website Airbnb illegal, with a finding that a man there broke the law by renting out his apartment through the service.”
There are strict hotel laws in NYC. A judge arbitrating the case for the city’s Environmental Control Board claims using Airbnb violates New York’s illegal hotel law. That law is designed to stop landlords from turning residences into hotels, and prevents citizens from renting out their properties for less than 29 days. Tenants in NYC sub-lease apartments all the time, and that’s legal as long as it is for more than 29 days.
On May 10, a NYC judge fined New Yorker Nigel Warren $2,400 for violation of the hotel law. Not sure why he was snagged – Warren had faced a $7,000 fine for violating building and zoning codes in addition to hosting guests in his condo via Airbnb. According to CNET, the law is only actionable as a secondary offense. In other words, the city will only enforce the rule if a complaint is filed.