The Best Cottage Court Guy I know

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Front row left to right; Bruce Tolar, Steve Mouzon, Jason Spellings, and Jene Ray Barranco.

Last weekend I was working on a charrette crew that included my colleague and partner, Bruce B. Tolar.  Searching through my hard drive today I came across my (improvised) remarks from when the New Urban Guild gave the 2015 Barranco Award to Bruce, the Developer/Builder of Cottage Square in Ocean Springs Mississippi.

“For those of us who knew Michael Barranco and were there for the Katrina charrettes, this is a person who really made a mark on our lives, not just because we showed up and did work together, but because his character was such that it was like playing in a pro-am: You really upped your game when playing around Michael. Very genuine. No artifice. No phoniness. He was genuinely concerned about every person he ever met, and wanted everyone’s life to be better. He decided that architecture was his way to do that.

With his passing, there is a hole in the CNU, but the New Urban Guild offers the Barranco Award to practitioners who are that kind of stand-up guy. It’s about the character with which you comport yourself. It’s about how hungry you are to learn. It’s about how much you care about your community. It’s about how much you love and encourage your fellow-citizens. With that said, I’d like to introduce you to this year’s award-winner, Bruce Tolar, through some of his work. <begin slides of Bruce’s projects>

The original Katrina Cottage which by itself was great, but Bruce took it out of the total chaos and mayhem and bad financial circumstances that were pretty much an everyday deal in Ocean Springs at that time, and all along the coast. And from nothing, he created the peaceful excellence of Cottage Square, where he put the pieces together into something amazing which that community cherishes. It has even become a tourist destination. Imagine that: an interim housing solution after a hurricane has become a tourist destination!

So Bruce pulled together all the Katrina Cottages that were built as prototypes for demonstration purposes and brought them to Cottage Square. And he made something out of the pieces, just as we all try to do, which is to aggregate a great place from small incremental parts. It is a modest place, with gravel sidewalks; a place where you can operate a tiny business out of those tiny buildings. And the community that has formed there has become a real anchor to Ocean Springs. From there, Bruce launched an expansion, which was an incredibly ambitious project in a place governed by FEMA… <cough> <laughs and applause> … a terrible environment to work under, but he is doing amazing, excellent work with modest little pieces.

He reached out to nonprofits in the area; he connects with so many people; he’s been in that town forever, serving on many boards; and the idea that there was something to be done after a hurricane, and fixing civilization in general, was a natural thing for Bruce. The people love this neighborhood. The nonprofits he’s been working with have been tremendously empowered by seeing one guy’s ability to put people together and make things work. Bruce is the best design caulking gun you can imagine, pulling everything together on modest means and making things happen. So with that, I’d like to present this year’s Barranco Award to Bruce Tolar.”

If you are traveling along the Gulf of Mexico between New Orleans and Mobile you should give yourself a treat and stop to walk around Cottage Square.  It is a special place built in tough circumstances by a remarkable guy.

Why Bother with this Small Developer Stuff?

NicksConeyIsland
Hawthorne Boulevard, Portland OR

 

If you have been reading this blog you know that I am always pushing for the creation of smaller development enterprises, building smaller and simpler buildings (without elevators for the most part), using off-the-shelf financing, and the delivering smaller units for the smaller households that make up a big portion today’s local markets.

I think we can do a much better job of connecting the housing unit to the list of consequential stuff people consider in their decisions to rent if we can deliver flexible unit configurations, competitive rent + transportation math, and locations close services, food and drink.  Here is a list of stuff I shot off in an email to a colleague this morning:

  • It is important to shift the approach to development projects to a smaller, more incremental scale.
  • Re-imagine the development enterprise as a smaller outfit that can compete without economies of scale, recognizing the constraints in economies of means.  If a municipality wants to revitalize a neighborhood, cultivate multiple small operators and roll out a Pink Zone.  Don’t do a big lumpy Public Private Partnership.
  • A small outfit can aggregate several small projects into a portfolio within a decent neighborhood structure.  This will provide a platform with significantly reduced downside risk and enhanced upside benefits.
  • It is time to take the Arthur C. Nelson’s work seriously.  There is a significant lack of supply of housing in walkable urbanism and half of new housing needed between now and 2030 will need to be rental housing.  (See Dr. Nelson’s Book  and  video).
  • With construction production at less than half of 2005’s peak, builders of single family homes, apartment complexes and commercial buildings are experiencing shortages of skilled trades all over the US, so small developers will need to cultivate a local base of small trade contractors to avoid the labor shortages.
  • Small developers are positioned to help local entrepreneurs create local wealth and local jobs among their trade base and their local tenants.  Small, cheap workspace needs to be provided at modest scale within the context of a neighborhood.
  • The small developer business model needs to be accessible to younger people, immigrants, and folks who already have one or two of the skill sets needed (brokerage, leasing, property management, finance, entitlement, design, construction management, communications).  We will need to develop training, tools and templates and a network of early adopters to reduce the learning curve of rookie developers.  There is a lot of interest in training and tools from the leadership of Congress for the New Urbanism and the Incremental Development Alliance.  I am active in both of these and recommend that anyone interested in this work do the same.
  • Many of the project management, construction management and property management advantages that were once only available to large outfits that could achieve economies of scale have been disrupted by technologies like BaseCamp, BlueBeam, AutoCAD360 for the iPad, QuickBooks, ClearNow.com, PayYourRent.com, YouTube, and the smartphone.
The market demand is large enough and the supply of anything remotely resembling walkable urbanism is small enough that all kinds of lousy half-baked projects are going to get built and get rented or sold in the next 15 years.  This mismatch between very low supply and very high demand provides lots of room for dumb projects, but it also presents the opportunity to re-scale the development business.

Last Call for the Atlanta Small Developer Boot Camp October 13-14, 2015

A straightforward three bay building on Wylie Street in Reynoldstown, Atlanta.
A straightforward three bay building on Wylie Street in Reynoldstown, Atlanta.

Next week Jim Kumon, Bruce Tollar and I will be in Atlanta for another small developer boot camp.  The Georgia Conservancy and the Atlanta Chapter of the Congress for the New Urbanism have put together a great venue and did an excellent job getting the word out. Most of the folks who have signed up are from the Atlanta region, but I saw the names of colleagues from Washington DC and Asheville on the list. Last I heard from Jim, 110 people have registered.  So here is a heads up.  Registration closes on Monday.  People infected with the small developer virus have the nerve necessary to wait until the last minute, so there is usually a bit of a surge in the last couple days of registration.

We get started Tuesday evening with a get together at the nifty converted church offices of Kronberg Wall Architects in Reynoldstown and we will be at the Center for Civic Innovation all day Wednesday. (near the Five Points MARTA station)

If you are still on the fence, give a listen to Eric Kronberg explaining what to expect:

Switchyards Podcast with Eric Kronberg

Then go register on the CNU.org website: Register for the Atlanta Small Developer Boot Camp

The next boot camp on the schedule is an in depth 4 day event in Western Michigan in early December.  Jim Kumon is firming up the dates with the local hosts.

How do you handle all the risky stuff that goes into development?

Courtyard between apartments in New Town St. Charles Tim Busse - Architect.
Courtyard between apartments in New Town St. Charles Tim Busse – Architect.
Ahead of the Small Developer Boot Camp this weekend in Duncanville, TX, I have been thinking a lot about how folks outside the field perceive what it takes to be a developer, and how that perception departs from the reality.
People that are not developers often talk about the developer’s amazing and unreasonable tolerance for risk as a defining characteristic.  This is not correct.  Seriously.  The key thing to understand is that Developers typically see the risk of a project parsed into hunks, not as one big scary ball of risk and adversity.
A developer’s job is to identify risks in the stages along the arc of the entire project and then manage or mitigate those risks with the appropriate know how, relationships, time & attention, and setting up the right deal structure to align the interests of the parties.
Market and Site Selection Risk is managed by doing lots of homework before committing to a specific site or sites.
Entitlement Risk is reduced or mitigated by building as-of-right projects or by not closing on the subject property until entitlements are secured, and by thoroughly understanding the technical steps in the process, the politics of the place and the culture of the staff and neighborhood.
Construction Risks (including cost overruns and delays in completion) can be reduced or mitigated by not taking on projects with building types outside of the developer’s experience.  Podium Buildings are a different animal than wood frame walk-ups, Mixed use building are different from one story commercial building or walk up apartment buildings.  If you are making a move to a more complex building type, get a partner who has been there before.
Leasing Risks are managed by doing your homework on market preferences and competing projects recently built or in the pipeline.
Financing Risk can be reduced or mitigated by cultivating multiple sources for equity or debt and not being tied to one investor or just one bank.  Rookie financing risk can be reduced by getting mentors and advisors to review and critique your deal on paper several times before you put it in front of an investor or construction lender.  Structuring multiple exits for investors and for the developer reduces financing risks following construction and lease up.
The mechanics of managing risk can start with assembling checklists and standardized deal structures and agreements with consultants and trades.  With practice comes more mature perspective and a more intuitive grasp of what activity and risks should demand the developer’s attention at a given time within the project arc.

Small Developer Boot Camp Registration is filling up fast. Better get on it.

Membership is open to people with and without hair.
Membership is open to people with and without hair.

The Small Developer/Builders Group on Facebook now has over 600 members. Small Developer/Builders Group

Some members are curious lurkers, some are practicing developers, and many are on the fence trying to figure out what it would take to make the move from their current day job into developing small scale, incremental projects. We have seen several clusters of folks connect through the group and decide to meet up in person.  It’s been quite marvelous to watch the group grow in number and see the discussion move past daily posts of whatever is on my mind that I think might be useful.  Click the link above and ask to be added to the group if this sounds like something you want to explore.

The August Small Developer Bootcamp in Duncanville has been capped at 75 participants.  There were 56 people registered as of lunch time Friday.  So just 19 spots are left.  If you were intending to join us in Duncanville, now is the time to go over to the registration page and sign up.  It looks like the event will fill up at the early bird registration price of $100.

Boot Camp Registration / Strong Towns