Building plans shock industry

Published April 22, 1991|Updated Oct. 13, 2005

Citrus County's largest land development company is about to become the largest home builder, too. If the construction company to be formed next month by the Tamposi family, developers of Citrus Hills, builds even half of the 250 homes a year its officers are predicting, it will surpass in volume all of the county's home builders.

The Tamposis' announcement shocked the local building industry, especially since the developers long have said they have no interest in construction and has led to a lawsuit from the five builders now working in Citrus Hills.

Equally surprising was the closing of the northern sales offices that have piped thousands of customers to the sprawling subdivision since 1982.

Those changes mark a drastic departure from the family's formula for success: Fly large numbers of soon-to-be retirees from the North to Florida, show them Citrus Hills' rolling woods and green fairways, then sell them a lot.

In his office this week, Stephen Tamposi, son of Citrus Hills co-founder Sam Tamposi and national sales manager for the development, discussed the sudden shifts and the company's new directions.

"We're really going to upgrade the whole project," he said, talking excitedly about the fully furnished model homes planned for the second phase of Citrus Hills. "We want this to be the jewel of Citrus County."

Why the shift to building, and why now? In short, a combination of factors are at work, Tamposi said.

Among them: a change in company philosophy, shifting housing markets, plus the realization that there is a huge market among the thousands of people who have bought lots in Citrus Hills but haven't built there yet.

One thing the company isn't doing, Tamposi emphasized, is abandoning the target-rich environment of northern retirees who have made Citrus Hills a success. Despite closing the sales offices and firing about 50 staffers, the Tamposis still plan to market heavily in the North.

Though based in Florida, sales representatives frequently will head north for seminars and builders' shows to tout the developments and the model homes.

And customers still will be flown to Florida to see what they're buying.

"We want the customers to come to the property," Tamposi said. There just won't be as many of them.

Tamposi said he thinks the economy is about to improve and the shift to homebuilding offers an excellent chance to take advantage of it. With the poor economy, "people living up north haven't been able to sell their homes." That, he said, has created "a tremendous amount of pent-up demand for housing."

The economy will brighten in the next six months, predicted Scott Stephens, Citrus Hills general manager. When it does, those people will be ready to move to Florida.

A survey last summer of about 200 Citrus Hills lot owners showed that about 75 percent plan to build homes on their property within two years, Tamposi said.

Those numbers, as well as the thousands of other potential homeowners in Citrus Hills I and II, are difficult to ignore. Of about 4,000 lots sold in Citrus Hills I, only about 1,500 are developed. By shifting to home building, the Tamposis can tap into that lucrative market.

In the newer Tamposi developments, the company will sell homes and lots in a package, with the customers agreeing to build on their homes within two years.

That has several advantages, Stephens said. The volume of customers needed is far lower _ about 250 a year rather than the hundreds needed before _ and the amount of money each one will be investing is far greater.

"We're not going to fly the volume of people here that we have when we were doing land sales," he said. But to sell 250 homes, "we're going to have to fly a good number of people down."

Tamposi insists the slumping northern real estate market didn't trigger the company's recent changes. "We sold 1,200 lots in 1989 and 800 in 1990," both good numbers, he said.

Yet industry analysts say the slump and the highly publicized indictment last year of General Development Corp. for allegedly bilking thousands of buyers on overpriced homes, have forced many Florida developers to change their strategies.

"There are a number of companies reviewing their marketing techniques in light of the General Development Corp. bankruptcy," said Katherine Emrich, bureau chief of land sales registration with the state Department of Business Regulation.

Much of General Development's marketing was through the "fly and buy" technique used by other developers, including the Tamposis. The case received huge publicity in northern states and was the subject of a February 1990 report on the television news show 60 Minutes.

"The message was sent out to prospective purchasers out of Florida to be very cautious," Emrich said.

Though many people still want to move to Florida, "there's been a decline in the number of people flying in for a week" and buying lots, she said.

"The General Development problem definitely affected all of our markets," agreed Michelle Garbis, a senior vice president with Miami-based Deltona Corp., developers of Citrus Springs.

Deltona still believes in flying people to Florida to see what they're buying, but fewer buyers are willing to sign up right away, she said.

Deltona is considering re-entering the home building market, she said. "People want to know exactly what they're getting. Perhaps they can attach a little more tangibility to a house than a lot."

In a letter to Citrus Hills customers in March, Tamposi wrote that forming the construction company "is the only way we can guarantee quality construction, the best possible prices and superior customer service."

That angered the five builders who have agreements with the developers to build homes in Citrus Hills. Last week, they filed a lawsuit seeking to clarify those agreements.

The "developer by implication stated that (the contractors) did not build quality homes," their attorney wrote in the complaint. In fact, Tamposi "knows full well that (the contractors) construct only high-quality homes with the very highest degree of customer satisfaction," the complaint says.

Tamposi wouldn't criticize the current builders. But there have been problems and complaints with previous Citrus Hills builders, and he and Stephens made it clear that they're looking to go in a different direction.

The new furnished and landscaped model homes will be integrated into the marketing of the subdivisions. That, Tamposi said, is a key reason for the changes.

Tamposi said the design of the homes will match the upscale theme and the individual features of the subdivisions: the championship golf, horse trails, custom tennis courts, hoped-for lure of the Cleveland Indians spring training facility and the land itself.

As with Citrus Hills I, the sports and recreation emphasis will continue. The presence of former Boston Red Sox star Ted Williams in the community is a hit with New Englanders, and "tennis is a big recreation product," Stephens added. "We'll definitely be promoting that in the new project."

Planning for the development based around the proposed baseball stadium is still in the early stages, but will continue that recreational emphasis.

The village concept allows homes of varying prices on lots of different sizes to appeal to a variety of customers, Stephens said. Homes in Citrus Hills II will run from about $100,000 to $200,000, Tamposi said.

Tamposi, 30, is an enthusiastic sales representative who talks of Citrus Hills in the same tones the pioneers must have used when describing the wonders of the western lands.

"Where else can you find land like this?" he asks repeatedly on a rental car tour through several of the family's developments north and south of County Road 486.

In Clearview Estates, south and east of Citrus Hills, the white picket fences and 1-acre lots were designed with horse owners in mind. A 5-acre equestrian facility, complete with stables, will be the centerpiece.

North of County Road 486, the landscape changes dramatically in the brand-new Canterbury Lakes development, built in an old phosphate mining area. Unlike the open spaces of Citrus Hills, Canterbury Lakes offers tall, heavily wooded lots on promontories overlooking the clear lakes formed by the mining pits.

In Citrus Hills II, officially named The Villages of Citrus Hills, red and blue stakes mark the locations of the greens and tees for the Arnold Palmer-designed championship golf course.

The development, on some of the highest ground in the county, offers wide vistas of the golf course and rolling hills. The latest plans call for 3,599 units on the 2,067 acres, fewer homes than were in the original plans.

Tamposi continually stresses the importance to sales of having a lot of homes built. Customers don't like seeing miles of empty streets, he said.

"Now is the time for Citrus Hills to develop the community," he said. "The only way to do that is to build more homes."