Those of you who took interest in N.C. State professor Bartley Danielsen’s recent John Locke Foundation presentation, which documented potential environmental benefits of school choice, might appreciate a Bloomberg Businessweek article on real-estate developers who use new schools to help attract buyers.
Real estate developer FivePoint Communities Management is already building a school at its Great Park Neighborhoods project in Irvine, Calif., even though it’s still selling the first 700 homes. “We build the schools ahead of time,” says Emile Haddad, chief executive officer of FivePoint, which has permits for about 10,000 homes at Great Park. “That way we always have them ready.”
Homebuilders have touted local schools, along with parks and recreation facilities, to attract buyers to their communities for decades. Now, as school districts face tight budgets and homebuilders compete to draw families able to qualify for mortgages, developers are taking the lead, helping to launch public, private, and charter schools.
Sales of new single-family homes have trailed the broader housing recovery, in part because buyers balk at high prices or the remote neighborhoods where more affordable residences are available. New home sales fell 14.5 percent in March from February to an annual pace of 384,000, according to the U.S. Department of Commerce.
In Apollo Beach, Fla., Newland Real Estate Group donated space so a private Montessori preschool could be ready to open in 2012, before the first house sold in its Waterset development. The school, which is expected to add higher grades, intends to attract parents who might be turned off by “test-score issues” at nearby public schools, says Teri Slavik-Tsuyuki, chief marketing officer for Newland, the largest U.S. developer of master-planned communities, with 28 projects in 14 states. “We don’t do this because there are exactions that the counties are dragging out of us,” says Slavik-Tsuyuki. “We knew that a school was the right thing for the community, and that’s just the cost of doing business.”
At nearby FishHawk Ranch, Newland spent $5 million in 2009, at the bottom of the housing market, to prepare a building site for a new high school, almost five years before model homes were ready. “It was like Field of Dreams,” Slavik-Tsuyuki says, referring to the movie’s famous “If you build it, he will come” line. “There’s this massive new school in the middle of this vacant, open master-planned community.”