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Golfing great Hal Sutton found himself in the Texas Hill Country about 12 years ago, with a stop in Fredericksburg. He might have thought he was in Tuscany, not Texas, because the terrain was so similar he wondered where the olive trees were. The idyllic German-esque community of about 11,000 in Gillespie County rests about 70 miles west of Austin and 52 miles north of San Antonio. Fredericksburg, famous for its summer peaches and German brews, caught Sutton’s heart and never really let go.

But it got his brain busy calculating, dreaming.

“This is beautiful,” the 14-time winner on the PGA tour told his wife, “This is the Aspen of Texas! We need to buy something here, build something here. Once the rest of the world discovers how beautiful this place is, it will just take off!”

I relate to that feeling totally. Whenever I drove my son to camp in Hunt, Texas, for years back in the 1990’s, I too fell in love with Fredericksburg and the gentle hills surrounding it. It is the perfect primary, second or vacation home location — drive-able from most major Texas urban areas, scenic, hilly, and loaded with activity. There is water: Lake LBJ and the Guadalupe and Pedernales Rivers, and there is land: mountain climbing at Enchanted Rock, horseback riding, endless hours of hiking.

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Hal Sutton did more than just dream. He built the best exclusive family golf community in Texas, Boot Ranch. Armed with a $30 million investment from his partner, the Louisiana Municipal Police Employees Retirement System (Hal is from Shreveport), his own funds, and a network of good friends, he created the perfect ranch for city slickers looking for a getaway on the range laced with golf, gourmet food, and guns. He chose a beautiful spread of 2050 acres with the Palo Alto Creek winding through about five miles north of Fredericksburg, on the road to Llano. In case you don’t know, this is the hilly neck of Texas where most big time billionaires play rancher — Kelcy Warren, Tav Lupton, David Bamberger of Church’s Fried Chicken fame, to name a few.

Sutton’s dream team planned for 387 home sites of various sizes, shapes, and prices, all with a definite Texas Hill Country look and flavor.

And then he gave it something only Hal Sutton could: one of the best golf courses in Texas, a place he hoped would and believes will rival Augusta National. With its rugged hills dotted with cedars, curves and creatures, Boot Ranch offers golfers some of the most beautiful golfing terrain in the state. There are twin 40-foot waterfalls in front of the 10th green. The Dallas Morning News has ranked Boot Ranch no less than five times as one of the Top Ten Courses in Texas, and the course has been rated by Golf Digest as one of the Top 10 courses in the COUNTRY. The course measures 7,250 yards from the championship tees for a par of 71. Even veteran golfers find it a challenge each time they play. There is also a 34-acre practice park, which includes a short game range and an executive Par-3 course. The Director of golf is Emil Hale, hand-picked by Sutton himself.

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Boot Ranch launched in 2004 with the vision to create a world-class vacation home destination deep in the heart of Texas, with a true Texas twist. There would be a Sutton supreme golf course, a clubhouse village with casual and fine dining, pools and spa, guest lodges, zero-lot line low maintenance units, and acres of undeveloped acreage in between each homestead. This was not to be a development where units were crammed on the land to maximize return. Every element of the development would be completed on the highest level of luxury, and extended family would be encouraged to play and stay by way of a vertical membership to multiple generations. Traditional ranching is losing its luster with subsequent generations, and Boot Ranch would offer homeowners a chance to enjoy the romance of the ranch life, without the headaches. Homeowners could build homes of their choice, with builders of their choice, as long as design styles adhered to the community’s design standards to keep the look “Hill Country”. They could enjoy a community of activity right on the ranch on a level that Bick Benedict would have approved: trap and skeet shooting, fishing, hiking and mountain bike trails, horseback riding, swim and of course golf, and still be five minutes from the charm and amenities of Fredericksburg.

Then came the Greatest Recession since the Great Depression.

Like most vacation and second home communities during the financial crisis, Boot Ranch found its once-eager buyers holding back. After 37 brisk sales, Sutton brought in Legacy Properties for a restructuring in 2007, pumping in tens of millions in infrastructure costs. The U.S economy dove even further, and, like many developments across the nation, Boot Ranch equity was under water. Its resulting foreclosure left the estate of Lehman Brothers Holding Inc. – the major Boot Ranch noteholder – holding the keys.

Recognizing what a treasure they now owned deep in the heart of Texas, with a mandate to protect and maximize creditor assets, Lehman continued to fund, build out and finish the project. It was business as usual, riding out the storm, just as the Cowboys did on those craggy, rugged hills.

“Well, there’s one thing you got to say for cattle… boy, you put your brand on one of them, you’re gonna know where it’s at!”- Luz Benedict

Sutton had clearly branded a lifestyle at Boot Ranch, one that even a national financial crisis couldn’t touch. Part of Lehman’s luck was that Boot Ranch was located in the Lone Star State, a market that was barely touched by the recession. Texas residential real estate came back more quickly than other markets for several reasons: our values have never skyrocketed artificially as they have in some markets, and Texas puts the reins on home equity lines of credit, limiting them to 80% of home equity.

For two years, from 2008 to 2010, there was little sales movement at Boot Ranch. But when the economy turned north, the Texas real estate market turned into a Blue Norther. In 2011, Boot Ranch was at the top of lot sales for the State, selling between $10 and 20 million in inventory. And, Hal Sutton announced he was coming back to further brand the completion of his dream.

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In 2012, Boot completed the plans for its award-winning, 55,000 square foot rock stone Clubhouse Village. Steering up the steep hill on the rocky circular drive, you truly think you are coming into a centuries old Italian village. The clubhouse was designed by Mike Marsh, who recently completed the stunning remodeling of the toney Dallas Country Club in Highland Park, to maximize the terrain and view. A rock archway frames the vista over miles of the ranch and a waterfall leading to the lagoon pool, ranch club pavilion, tennis and sport courts. The Village includes the golf pro shop, men and women’s locker rooms complete with steam rooms, the spa and wellness center, exercise center, and the dining room. Boot Ranch offers owners a choice of casual or fine dining under the direction of Executive Chef Aaron Staudenmaier, who worked with famed restaurateur Kent Rathbun in Dallas. There are ten luxurious lodge suites for guests with jetted tubs, separate shower and rooms the size of Manhattan — some just under 1000 square feet. These function as extra living quarters for members’ family and friends.

Then there are the lots. Boot Ranch has a variety of options from the sprawling, elegant estate home sites, which range in price from $300,000 to $2.5 million for as little as 2 acres up to a whopping 18 acres, including club membership.

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There are the smaller Overlook Cabins, situated on approximately one-half acre sites with these price points starting at $239,000 to $449,000 including club membership, for dirt. Homes ranging from 1,800 to 4,000 square feet are going up as I write this, many pre-sold. Pricing for the lot and completed cabin ranges from $700,000 to $1.4 million.

Finally, Boot Ranch revived an old German trend from the original Fredericksburg settlers: the Sunday House. These were homes that were “shared” by settlers attending church services in town. The Sunday House gave them a place to rest, repast and refresh before the long ride back to the ranch, in a wagon or on horseback. Boot Ranch’s concept is a fractional ownership of each Sunday house with pricing at $300,000. Each Sunday House is about 3,800 square feet of detached space — a gathering house with family room, gourmet kitchen and laundry room, and four master bedroom suites, all detached but connected by walkways. It’s a similar concept to the way homes were built with detached rooms into the hills at Calistoga Ranch. The Sunday House concept has proven so popular and affordable, shares in the first four cabins are almost sold out and construction is underway on a fifth. Sunday House owners share their usage, averaging between 35-45 days each during a year. Buyers are streaming in primarily from Houston and Dallas, with others coming from San Antonio, Austin, Fort Worth, Tyler, Midland, Odessa and elsewhere. A few are even from out-of -state.

In 2011, as the U.S. was waking up from the recession, the movie Seven Days in Utopia was filmed at Boot Ranch. Starring Robert Duvall, directed by Matt Russell, the movie is based on the book: Golf’s Sacred Journey: Seven Days at the Links of Utopia, by David L. Cook, PhD. Cook is one of the country’s top sport psychology consultants and motivational speaker who has worked with more than 100 PGA Tour players. Among many coaching roles, Cook serves as sport psychology coach to the 1999 World Champion San Antonio Spurs. His story is about a young golfer who finds life’s purpose at the Links of Utopia.

In many ways, Hal Sutton found HIS life’s purpose at the Links at Boot Ranch, generating an attainable legacy for families to take a healing break from the insanity that 21st century life has become. It’s a place to kick back, put up your boots, re-connect with family and nature and maybe, just maybe, give you a chance to find your life’s purpose under the golden glaze of a Hill Country sunset.Boot Ranch 24

 

 

 

 

Those of us in real estate know that when the housing market plummets,  vacation places plummet the most. Second homes are most often discretionary purchases you wait on until you feel flush with cash.

Well, get ready. Realtors say second-home buyers are returning to the store,  shopping from Cape Cod to Lake Tahoe. As I told you, nationwide vacation home sales rose 7% in 2011 to 502,000 homes, according to the National Association of Realtors. They made up 11% of total sales in 2011, more than they did in 2010.  And NAR’s spokesman Walter Molony, who I hope to see in Denver next week at NAREE, expects continued momentum.

“We’ve heard positive reports from Las Vegas, Telluride, Col., Lake Tahoe, Naples, Fla., and some areas of California,” he told Investor’s Daily. “We’ve been seeing a little bit of unleashing of pent-up demand.”

Well yes, that plus bargain prices.

But while the number of transactions is increasing, vacation home prices are still not generally appreciating. The healthiest segment of the market is, surprise surprise, upper-end properties: the luxury market.

Neal Hanks, an Asheville, N.C. agent says he is seeing significant increases in sales of homes in excess of $500,000 in the Blue Ridge Mountains.

I hear the Florida market is even tightening up. No Girls Gone Wild, but firming. The recent death of my brother-in-law has me poking into the Naples market, where they own two homes. In nearby Sarasota, Manatee and Charlotte counties, inventory is just 4.7 months, the lowest since 2005.

In Southwest Florida,  broker associate Jennifer Calenda of Michael Saunders & Co., a luxury regional real estate firm affiliated with Ebby Halliday through Luxury Portfolio, says dollar volume sales are up. Prices are not going up, but people are buying about $100,000 over where they were — so folks looking at a $300,000 condo might spring for $400,000. Are people really feeling more flush, more confident, or just sick of depriving themselves?

Some feel people are getting back on their feet, paying off debt, and I think I read that American’s debt levels were decreasing. David Southworth, founder and CEO of Southworth Development, which specializes in upscale vacation-resort communities, says demand is coming back as people get on their feet.

“The second-home market is always a trickle-up type,” he told Investor’s Business Daily. “As the economy gets better that means small business owners start making money again and executives start getting bigger bonuses. And that’s when our customers come back.”

“During the past year, investors have been swooping into the market to take advantage of bargain home prices,” said NAR Chief Economist Lawrence Yun . “Rising rental income easily beat cash sitting in banks as an added inducement.”

The median vacation-home price was $121,300, down 19.1 percent from $150,000 in 2010.

The typical vacation-home buyer was 50 years old, had a median household income of $88,600 and purchased a property that was a median distance of 305 miles from the primary residence; 35 percent of vacation homes were within 100 miles and 37 percent were more than 500 miles. Buyers plan to own their recreational property for a median of 10 years.

Eighty-two percent of vacation-home buyers said the primary reason for buying was to use the property themselves for vacations, or as a family retreat. Thirty percent plan to use the property as a primary residence in the future, while only 22 percent plan to rent to others.

Forty-two percent of vacation homes purchased last year were in the South, 30 percent in the West, 15 percent in the Northeast and 12 percent in the Midwest; Only 1 percent were located outside of the U.S.

They’re not all back. Southworth recently bought some communities on the cheap after the real estate bubble burst: Creighton Farms in Virginia horse country and most recently Willowbend in Cape Cod. Willowbend is doing the best, because of 8 million in metro Boston who can drive there. Most second home owners prefer to drive to their vacation homes, on average about 4 hours, but most often one or two.

Next week, I’ll hear more about Longcove at Cedar Creek Lake east of Dallas: 45 minutes east of Dallas.

The segment doing the best is the high end of the vacation market, this according to Brent Herrington, senior vice president of luxury developer DMB Associates.

“Inventory is much scarcer in the most desirable locations,” he said. “Prices are firming … we’re getting back to a world of multiple offers.”

Those amazing deals in the tops spots of the Hamptons, Martha’s Vineyard, Aspen and Vail peaked in hit in 2010-11. If you didn’t do it then, or are not quite in that league, look for the secondary markets — beachfront but not the name-drop locations.

After a few decades of recession, Palm Springs is becoming a hot second home market, beating out Santa Fe, say some realtors. And the developers are there to give buyers what they want: sun and out here, golf.

“We find our buyers appreciate all the things that Palm Springs and Indian Wells has to offer – the relaxed, resort atmosphere, no traffic concerns, friendly service, warm winters, incredible views and an abundance of outdoor activities, “ says Bill Bone, CEO and Founder of Sunrise Company, developer of Toscana, a golf community development in Indian Wells.

There is golf of course but also hiking, biking, farmer’s markets, as well as great shopping, dining, entertainment, the arts and medical facilities.

“Members have so much fun here, they call it “Camp Toscana”, says Bone. “We are very pleased with our sales results this year: have been 34 homes sold at Toscana, more than $59,000,000 in total sales.”

 

Palm Springs is within close proximity to sooo many Cali locales – less than 2 hours from LA, Laguna, San Diego, Palm Springs is brimming with mid century architecture, history and development.

“It appeals to people who really value properties of that era, and the new boutique hotels and restaurants keep things fun and interesting,” say Palm Springs agents Mark Godson and James Dalton Utsey. “The evolution of our downtown strip continues with the Fashion Plaza being rebuilt as a pedestrian friendly shopping and gathering place.”

 

Like many areas in California, Palm Springs was not spared during the housing bust, but values are beginning to inch up. Don’t have to worry about hurricanes here. Look carefully there are deals to be found.

 

Many consumers buy thinking they can rent out the home for cash flow and potential income, and they can. Vacation home rental listings are up at the website HomeAway. It had 433,000 listings in 2009, but 700,0000 listings now, says its vice president, Jon Gray.

Buyers are stirring, multiple offers are being reported, but there are no indications of appreciation. In some areas, prices are still falling. Do not be afraid to make an offer below asking: U.S. vacation home asking prices dropped 1.7% year over year in the 12 months ending in April, as overall listing prices fell 0.2%.

I do not advise buying a vacation home for pure appreciation. Just look for family enjoyment and maybe a place to rent out.

Still, some areas are seeing a tweak upwards when the distressed properties are all sold out. And demographics may be favorable for long term growth in vacation homes, with the average buyer age 50. There are 42 million people 50 to 59, right behind them are 43.5 million 40 to 49. Then there are 40.2 million people 30 to 39. These people grew up with vacation homes as common as swingsets and may follow their parents’ footsteps in buying.

 

We are going to feature very select hotels here on SecondShelters, because more hotels are becoming second homes, some offering CondoHotel deals as well as residences. Two weeks ago, I was in New York City, where I have had my share of negative hotel experiences. Hint: you smell Febreeze, there’s a reason. But I finally found the most perfect hotel in New York City if you want to be in the middle of Times Square and simply walk across the street to a theater. I’m talking 46th Street just a bit east of Broadway. Location with a capital L but also, once inside, a complete peaceful oasis from the NYC jungle with a huge Texas plus to make Dallasites feel right at home: interior furnishings by our very own Cantoni.   (more…)

They procreate like this: The Palms Private Residence Club in Playa Flamingo, Costa Rica, has signed a sponsorship agreement with the premier international second home exchange firm, 3RD HOME, that enables Palms owners (or buyers) to exchange their properties with other second (and third, and fourth) homeowners throughout the world. That opens second home stay options up to places like Costa Rica, Palm Beach, St. Barts, Paris and even Thailand –five star plus luxury vacation destination in more than 60 countries. 3RD Home now offer 372 properties across the globe.

And it’s funny that this press release crossed my desk today. Last night, at the beautiful designer Robyn Menter’s birthday celebration at Jerry Szor Contemporary Jewelry, I was talking to a couple who told me this is exatly what they wanted in a second home: no maintenance, no fuss, and not being tied down to one home ALL. THE. TIME.

So why not just stay in a hotel, piped in another guest?

Quality control, said he.

“In my years in the real estate business, I have never seen a more powerful offer for second homeowners than this one, ” said Peter Kempf with Peter Kempf International, whose company marries luxurious, high end second home properties with the perfect exchange partner. Peter is also the world’s leading expert on fractional home ownership. How to describe his background?  30 years experience in real estate and 12 years in fractional real estate. He’s worked selling and marketing multi-million dollar properties in 31 states, 22 countries, on 4 continents. He was Director of International Real Estate for Christies Great Estates, Vice President and Midwest Regional Manager for Sotheby’s International Realty, CEO/Europe for DCP International and a member of Who’s Who in Luxury Real Estate. Then there are his clients: the world’s most prominent CEO’s, successful entrepreneurs and, yes, celebrities. Last time I spoke to him, he was in Florence, where in the mid 90’s he launched Castello di Reschio in Umbria, Italy. His experience in Europe continues in the Private Residence Club industry and currently includes Palazzo Tornabuoni in Florence and Borgo di Vagli near Cortona.

In other words, yes, Peter Kempf is a world expert on luxurious vacation real estate.

“The relationships and member properties 3RD HOME has are some of the finest in the world from the Ritz Carlton Residences, to the Auberge Private Residences at Esperanza in Cabo San Lucas, to the Auberge Resort at Palmetto Bluff in Hilton Head that was just ranked as the #1 resort in North America by Travel + Leisure magazine.”

3RD HOME is probably the most unique international second home exchange program of its kind.  For a yearly fee, owners of high-end second homes can pool their property in a well-organized exchange pool in order to use another owner’s homes. Home values begin at $500,000. This way, second home owners are not limited to the environment of their own second home.

It’s like giving your second home infertility shots!

3RD HOME  has an amazing array of the most luxurious homes on magnificent beaches, vibrant cities and stunning mountains in their portfolio of rapidly growing residences.

About The Palms Private Residence Club:

The Palms Private Residence Club is the only luxury residence club in Guanacaste, Costa Rica. Nestled on the Pacific Coast’s pristine Playa Flamingo, each of the 32 Villas at The Palms offer stunning views of the Pacific Ocean. Offering all the advantages of vacation home ownership with the services and amenities of a first-class resort, The Palms offers its owners a luxury sanctuary and a more authentic experience. Potential owners can purchase 1/8th at $149,000 or 1/10th starting at $129,000.  For more information, please call 800-867-5762 or check out The Palms on Facebook @ Palms Villas or Twitter @palmscostarica.