Toll Brothers To Begin $50M Project

FISHKILL, NY-Despite a new home sales slowdown in the Northeast, an executive with Toll Brothers Inc.'s New York Metro Division, says sales are up 80% as compared to the same period this year. The firm is set to begin construction on its latest venture--the $50-million Regency at Fishkill active adult community--by June.

Dan Zalinsky, division senior vice president of the New York Metro Division of the Horsham, PA-based homebuilder, says the condominium development will cater to homeowners aged 55 and up. The project will feature 184 units of one- and two-bedroom homes ranging from 1,400 sf to 1,800 sf with garage parking. Prices begin at below $300,000. The site will include eight four-story elevator residential buildings, a clubhouse, pool and walking trails. Marketing for the venture will begin later this month.

The property is located on Merritt Boulevard adjacent to three of Toll Brothers' seven active development projects in the region: Van Wyck Glen, a 221-unit single-family home condominium project; Van Wyck Meadows, a 318-unit condominium townhome development and Van Wyck Mews, a 337-unit condominium flat, garden apartment style project.

Other active communities being marketed or under construction in the New York Metro Division include: Hollow Brook Mews, an 85-unit luxury townhome development in Cortlandt Manor; Old Hopewell Estates, a 63-unit single-family home project in the Town of Wappinger; Mountain View at Gardiner, a 33-unit single-family home development in Ulster County and Arlington Hunt, a 48-unit single-family home community in the Town of Poughkeepsie in Dutchess County. The New York Metro Division of Toll Brothers includes: Westchester, Putnam, Rockland, Orange, Ulster and Dutchess counties.

Zalinsky says the Toll Brothers' housing communities on Merritt Boulevard in Fishkill have been highly successful, even in the current challenging home market, due to its diversity of product and price points. Now with the launch of the Regency active adult community, "We are cautiously optimistic that we will nail that market as well," he says.

Its garden-style units at Van Wyck Mews are priced in the upper $200,000s range; its townhomes at Van Wyck Meadows are offered in the upper $300,000s and its Van Wyck Glen single-family units start in the upper $400,000s. Thus far, since marketing began on the projects in September 2004, 120 of the 221 units at Van Wyck Glen have been sold, while 148 townhomes of the 318 units at Van Wyck Meadows have been purchased to date. Since the launch of marketing in January 2007, 22 of the 337 units projected at Van Wyck Mews have been sold. That development also includes 20,000 sf of commercial space.

Zalinsky believes the division's diverse product offerings have a lot to do with its 80% increase in gross sales so far in its current fiscal year (began Nov. 1) as compared to the previous year.

"We are doing very, very well," he says. "In addition he notes that sales traffic this year is down 40% from a year ago, which is common in the home building industry. "So, we are doing far more with far less," Zalinsky adds.

Toll Brothers has plans to launch a new development in Orange County in 2007 and one in Rockland County in 2008. Zalinsky says the projects are in the approval process, but he did not provide any further information on the respective developments and their locations.

The company is marketing heavily to the renter market and is also seeing a good portion of its sales coming from homeowner referrals. Zalinsky says that like most homebuilders, the division increased its incentives after a "dead" summer '06 season to try to increase sales. However, due to its performance this year, "Now, we are able to start cutting back on those incentives. And for the first time in a year-and-a-half, we have actually had price increases on some projects. We are definitely feeling a turn around in the market up here," he says.

Zalinsky currently sees more buying activity in the lower price ranges, while luxury home developments are still struggling. He notes that Toll Brother's Mountain View at Gardiner luxury project is not selling as quickly as he would like. The nearly 4,000-sf homes are priced beginning in the low $500,000s, which is considered luxury in that area. Since marketing began about a year ago, just six of the planned 33 homes have been sold.

While he notes the home sales do not mirror activity levels in 2004 or 2005, he believes the market is showing signs of a rebound. In fact, Toll Brothers, which had trimmed staff last year in the New York Metro Division, is now gearing up to hire new personnel.