Hillwood Communities, a Perot company based in Dallas that's developed scores of communities across the U.S., recently opened its first one in the Houston area.
Pomona, a 1,000-acre site along Mustang Bayou south of Pearland, has sold about two dozen houses so far. The community just west of Texas 288 near County Road 101 in Manvel will be guided by Russell Bynum, the company's new general manager for the Houston region.
Fred Balda, president of Hillwood Communities, spoke with the Chronicle by phone recently. Edited excerpts follow.
Q: What's your history in Houston?
A: We've owned land in Houston. Back in the mid-2000s, we owned 3,000 acres in Sienna South. We sold that parcel to Toll Brothers two years ago. Since 1988, we've developed close to 80 communities across the nation. We have about 30 communities currently underway. The majority of them would be in Texas. We're Texas-based and Texas is our focus right now.
Q: Why didn't you build in Sienna?
A: We were prepared to break ground. This builder had such a huge appetite, they wanted the whole thing for themselves. We said, “That's fine.” We're buyers, sellers and developers. Toll Brothers is a big customer of ours. We've developed a lot of lots for them across the country.
Q: How did you find Pomona?
A: Pomona is a partnership with Hillwood and MHI. MHI – McGuyer Homes Inc. – is a builder. They have Coventry, Plantation and Pioneer Homes under their umbrella. They actually owned the land before we did. They contacted us to come in and recapitalize this project back in 2012.
Q: Are you looking to develop other communities in Houston?
A: In Texas, across the board. That was the main reason to hire Russell Bynum, a local veteran we're really confident in. His twofold goal is to make Pomona the best it can be, and let's take the Hillwood flag and the Hillwood brand and let's do some business in Houston, Texas.
Q: How big will Pomona be?
A: 2,200 homes total. The are 300 lots on the ground in the first phase. We expect this will be completed within the next eight to 10 years.
Q: What size do you look for when you're acquiring land?
A: Pomona is an average size for us. However, we will look at smaller real estate projects that are in the 200-acre range. It varies where you are in the cycle. You don't want to go too long on land when you're going down in a cycle.
Q: What parts of town do you like for development?
A: That's a tough question. We look for great school districts, great access to the business centers, great services. Pomona is very easy into downtown and the Medical Center. You've got a town that understands master-planned communities and the quality that we're trying to promote. We're a move-up, first-time and second-time move-up buyer market. We're generally that $200,000 to $500,000 product, and so we try to find spots where the market is void of that product or there's big demand for that sort of price point.
Q: What's the hot thing now in master-planned communities?
A: A big focus for most of our master-planned communities is the lifestyle component that we are now attentive to. You have a variety of amenities that we like to build: clubhouse, tennis courts, swimming pools. The last thing you want to see is they don't get used. You will have a lifestyle director that starts to organize a variety of activities when you start to move in. The other component, more of a focus for us, is the empty nester. That population continues to be a bigger and bigger population. Folks like myself would love to live in a master-planned community close to my kiddos as long as we have our own segment. The other focus is the other end of the spectrum, which is the millennials. They are now starting to buy.
Q: How are sales going in Pomona?
A: We just delivered our first phase in the fourth quarter. There's a lot of homes under construction now that are really getting ready for the spring market. I do expect a good spring. As the market starts to pull back somewhat, there's a stronger appeal for the master-planned communities. There seems to be this flight to quality when you have a downturn. There's a sense of security that comes with your home purchase.
Q: Are you concerned about the timing of the community being introduced with Houston's economy is slowing down?
A: I've got a little bit of concern. What gives me more confidence is where I'm located. I've got great access to that strong medical district in Houston and downtown. … We might see a little bit of a pullback with the energy sector being a little bit more challenged today. Again, you don't build a community for one segment of the market or one cycle of the market.
To view the article on the Houston Chronicle website, click here.