"The housing market's tough these days," acknowledges Avalon COO and vice president of operations John Gilbert, who oversees the firm's Austin office. "But with this size project the entitlement process takes anywhere from a year to 18 months to complete. Even though we started the process a few months ago, it still won't be ready for delivery till sometime in 2010. I think that's good timing, especially, for infill positions."

Gilbert emphasizes that the site's location in a fully developed market is what makes the development feasible. "Going out on the periphery would not be a good choice, but infill positions are still situated well," he says. "By 2010, there will be a market for infill locations."

Avalon acquired the property from Austin-based Solo Star Realty Inc. Gilbert tells GlobeSt.com he originally talked to Solo Star owner William Welch about the property more than a year ago. He says he was in the process of refocusing the firm's local development efforts on closer-in locations when they had the initial discussions, but he decided not to pursue the opportunity because of the price. "The price they were originally trying to move it at didn't work for us," he explains. "But time helped, and I was able to get back with Solo Star months later and work out a more attractive deal." He chooses not to reveal the ultimate selling price.

The site currently has multiple zonings, but Avalon is working with the city to rezone it exclusively single-family residential. Gilbert says local officials and neighbors have been receptive to the change, particularly since the development plan calls for retaining several natural springs located on the property and setting aside an undetermined but significant amount of land for park and recreational use. He reports the company has also met with nearby property owners to discuss the possibility of paying to extend a nature and recreation trail that ends on the west side of the freeway to the east side where the Avalon property is located.

Home sizes and prices have not been determined at this point and will depend partly on the number of lots permitted. But Gilbert anticipates the majority of homes built at the site will sell in the $250,000 range. "It will be up to the builders to decide, of course, but we believe this will be the appropriate level for the location," he says.