Belvedere owner loses line of credit. County may have to finish upgrades
The owner of the Belvedere development has lost his credit line to build $3.68 million worth of infrastructure improvements, possibly leaving Albemarle County with little choice but to finish the work itself, county officials say.
Wachovia Bank notified the county in November that it would not renew six letters of credit for the project’s owner, Belvedere Station Land Trust, which is led by homebuilder Bob Hauser.
Hauser’s firm had provided performance bonds to the county, guaranteeing that numerous infrastructure improvements would be made at the 207-acre neighborhood off East Rio Road that may eventually feature up to 400 homes and 275 apartments.
The improvements included tasks such as erosion control, storm water management, road construction, drainage, and water and sewer work.
“This, in very simple terms, has come about because the developer was not in a position to meet the bonding requirements,” said Albemarle County spokeswoman Lee Catlin. “We may have to step in and do it ourselves.”
In January, the county demanded payment on Hauser’s six lines of credit from Wachovia that were securing the performance bonds. Wachovia complied and Albemarle County now has the roughly $3.68 million sitting in its bank account.
On Wednesday, the Albemarle County Board of Supervisors will vote on a proposal to move that money into an expenditure account. Once that happens, the county will be able to either use the funds to complete the improvements or return the money to Wachovia if new letters of credit are issued to Hauser’s company, or possibly a combination of both.
If the county performs the work itself, Catlin said, Albemarle County taxpayers would not be footing the bill. Even if the cost of construction ran over the $3.68 million, she said, the county would seek any additional money from the developer.
“Right now, I believe it’s the developer who is on the hook,” she said.
According to the Board of Supervisors’ agenda, the county’s engineer is reviewing the project to determine if the county should complete some of the work rather than allowing the developer to re-bond all of the incomplete improvements.
Hauser could not be reached for comment Monday, as he is on vacation.
Mike Ball, chief financial officer of Bondstone Ventures — which is the parent company of several entities, including Hauser Homes and Belvedere developer Stonehaus — said in an interview that the situation at Belvedere is hardly dire.
Wachovia has indicated that it intends to extend credit to Hauser for the infrastructure improvements, Ball said, and the county will simply return the money it seized.
“The county is going through the steps it needs to go through,” Ball said. “My anticipation is that this will go back to the way it was.”
Ball added that many of the infrastructure improvements are not actually required for another year or two down the road. The only current requirements, he said, are erosion and sediment control. These improvements, he said, are already under way.
“We don’t anticipate any further infrastructure requirements through the end of this year and potentially into 2010,” he said.
Ball added that sales at Belvedere have been on the rise lately, with 10 sales and four closings so far this year. Most of the sales that have not yet closed are for homes that are still being built, he said. Thirteen homes are currently under construction at the development.
“We are really proud of Belvedere and the headway it’s made in a challenging environment,” Ball said.
Ball said that the situation with the county does not portend bad things for the Belvedere project.
“This doesn’t represent anything that would be harmful to Belvedere,” he said.
The development has seen some difficult times as the Charlottesville region’s real estate market has slowed significantly. One of the project’s two original builders, Church Hill Homes, went out of business and saw many of its properties go into foreclosure. That company’s principals joined Eagle Construction of Virginia, a Richmond company that essentially took Church Hill’s place at Belvedere.
Albemarle County Board of Supervisors Chairman David L. Slutzky said the situation with Belvedere Station Land Trust might be only the first of several such cases.
“These difficult economic times are going to result in a number of challenges when we’ve approved a re-zoning and the developer then falls on hard times,” he said.
Reader Reactions
I’m a yankee invader from the north. I come from a redneck town in PA. I am a nittany lion alum. I have always considered myself a democrat and environmentalist. I’m building a home in Belvedere.
First of all, the title of this column is very misleading and sensationalizes a ho-hum story. The county already has the money from the bank to do the necessary improvements… meaning it’s *already in* the government’s pocket despite whatever happens to the developer’s financial situation. The vote was more about bureaucratic administration than anything else.
The sanctimony and hypocrisy in some of these posts is obnoxious. First, builders are not automatically evil good-for-nothings… some yes, but certainly not all. Living on a farm doesn’t give you the right to bash the concept of developments and those who live in them… these developments sustain the vast majority of the population necessary to sustain the community of C’ville. We can’t all be so lucky to live out in the woods. Any business that wants to stay in business will spend what it takes to maintain the business… no more no less. A company is not greedy simply because it “does the bare minimum” to meet code specs… every penny counts, and if the bare minimum is insufficient, then the fault lies with those who wrote the code specs… talk to your government.
If you’re going to build a new development, Belvedere is a pretty good model. It’s built on what was essentially a junkyard, as another reader pointed out. The lot sizes are incredibly small, with an emphasis on home quality rather than quantity. All homes are earthcraft certified - better insulation, minimal construction materials, energy-efficient appliances, etc. Green spaces and local flora are celebrated, and where possible, existing trees have been retained rather than cleared.
As for Hauser homes, I can speak as a single data point that I am very satisfied with their customer service and their build quality has met my expectations. From what I hear, this has not always been the case… but maybe this economy has forced them to reinvent themselves a little. The few remaining employees are a scrappy bunch and work their butts off… if the company survives this recession it will be a very good one, and I have faith that they will continue to follow this newer business model when the economy rebounds. Hauser homes has always filled a niche in the real estate market - yes their quality might be somewhat lower than others, but their sale prices reflect that. Not everyone can afford/want/need the highest quality. Is Hauser homes perfect? Certainly not. But I have faith in them and sincerely wish them the best (I wouldn’t have bought in Belvedere if I didn’t).
As for Mr. Hauser… I believe that many posters have made a lot of assumptions. Everyone deserves a vacation every now and then… and for all we know he could be in the next county visiting relatives. He has lived in the area for at least 25 years (according to HH website), longer than a good fraction of the DP’s readership. Probably not a perfect guy, but certainly not the demonic monster some assume. Don’t slander the guy based on assumptions.
One of the reasons our local re-sale housing market has NOT skyrocketed is because local developer/builders continued to produce new homes a la Old Trail, Belvedere, etc. Now that new construction is virtually gone in the area because of financing difficulties, what will happen when the economyy DOES turn around and local rental rates are SKY HIGH because of all the new-hires to the area who can’t buy when they move here so they are renting when they take new jobs at UVa, MJH or NGIC, into the area?
We have approx 12 to 14 months of existing housing supply and more families moving into the area…what will happen when that CURRENT housing supply is absorbed and there is no NEW housing in the pipeline for the projected growth in population?
I agree, antiboyd. If the house was “crap” as you say, and there was a refrigerator door in your yard AND you bought it anyway… well, you are right… your bad.
I proved who’s point? I bought a house. Bad me. I am probably equally bad for paying my taxes, and complaining about people who spend their time holding picket signs rather than doing something constructive with their time. Yep, bad me, taking time to help out where I can.
Anyway, I am not a “lib” because I think that the developers here build crap and make a killing. Last I checked, the area runs pretty close to 50-50 in its political views, and I don’t think a single one of my neighbors owns a Prius—and, what if the do? Using less fuel, again, is bad?
What point, exactly, are you trying to prove?
You might try ‘splaining, Lucy.
Well, it appears that Hauser’s PR person isn’t on vacation. Too masny developers here build crap, care nothing about the ill-effects of neighborhood stormwater discharge beyond the most absolute minimum required by regulation anbd cut corners wherever they can. I don’t live in one of his or any other of the cookie cutter developments he and others perpetrate and I don’t really mind developments if they are built with quality, integrity and commitment to a better community. I’ve never heard those characteristics to be synonmous with Hauser. I don’t care about his company and hope it goes underso as to end the development of suchhousing. He, like most incorporated developers will be well insulated from his corporate holdings and since they’ve been on a ‘profit’ run for the past 20 years, tough luck now.
How refreshing to hear your point of view “Proud Yankee”, NOT… for the record, I do not live in a neighborhood, I live on a farm… and, drive a gas guzzling SUV. I do, however, preserve ancient hardwoods, farm organically and most surprisingly, generate an honest profit through hard work and moral business practices.
I’m sure that Bob (probably your neighbor or yoga buddy) is a good man and a fine business person. That’s not the point of this spirited email thread. The point is that you do business in any given community with regard for the people that actually grew up there and care about the future of the community. Yanks, such as yourself, typically ride into town in their tacky cars with shiny rims and want to change the look of their new town so that it feels more like their old haunt, typically Jersey or some hick town in PA. You don’t have to build a neighborhood that feels like it belongs in Edison NJ to make it affordable and attractive for first time home buyers. You build a smaller, yet better constructed, home on a smaller lot with some thought for the surroundings. Try and remember, you’re in a town where Thomas Jefferson created some of the most incredible architecture and landscaping on the planet and it doesn’t need to be tarnished by tacky folks who just rolled into town with their “big city ideas”.
To Antiboyd,
Thanks for proving my point!! You moan and groan and yet you buy. Yet another case of “it’s good enough for me, but don’t do any more of it”. It probably never occurred to you that the refrigerator door in your backyard might have been from the “my yard is my dump” redneck who lived there before “Deforested Lakes” was conceived?!? If you look at satellite imagery of what is now Belvedere you’ll see tons (literally) of redneck debris dumped throughout the land, including at least one old school bus, 99% of which was no doubt removed at great cost by the money grubbing, land hating, greedy developers.
BTW, you probably missed the lecture on “supply and demand” but I’ll sum it up for you. Incredibly tough zoning and multiple obstacles to development and building = higher housing prices. If the greedy money grubbing developer has to carry the costs of the land for 10 years while he fights the Prius drivers and their elected officials, then the cost of the end product goes up, crazy huh? Money grubbers! Don’t get me wrong, I love the tough zoning and all of the green space here, it’s why I chose to live here, but I’m also not a hypocrite about it, it comes at a cost, higher housing prices.
Well fear not Cville Libs, you’ll have to endure one day of pretending to like your country and then it’s back to illogical policy making and bashing anything capitalist!!! Happy Independence Day!!!!
Wow. THE LIGHT has broken through. That must be heaven, and Bob sitting at the Lord’s right hand!
Just to show how fair and balanced I am, I’d point out that the buzzards, aka ninnymuggins(?), and the “keepers of the american way” , aka proud yanquis, equally resemble the sound of fingernails scratching a blackboard.
For the record, I do live in a development, fondly referred to locally as “Deforested Lakes”. Our risk-taking developer was a fine, fine gentleman who unselfishly filled my backyard with a lifetime supply of industrial waste products, charred timbers, a refrigerator door (in case I ever need one?), and so much more—I hardly have the space to laud him for his mercy, grace, civic-mindedness. The many ammenities, aka liabilities, he dumped, er provided, the community association—how thoughtful. I am especially enamored of how one can turn gentle, rolling landscape and level it—the washed out escarpments are a nice touch; the silt-filled lakes, stunning. Awesomely affordable, too, which is why we have no housing problems here. Oh, did I mention that our developer’s risk-taking included some rather permissive behavior that would make the Governor of South Carolina blush?
Look, it is pretty silly to say that all developers are neither saints, nor sinners—or vice-versa. Like every one of us, they are a little bit of each. I’m sure Bob is a heck of a guy, but honestly, he builds crap, and part of the reason he gets away with it is that he is building in this area, where frankly, crap sells.
Unless, of course, you live in those parts of the county protected from developers… but we all cannot be as fortunate as that, can we?
Bob Hauser is a good man, who heads a fine family and company.I am frankly proud of the quality of life that he has provided to this area through his own hard work and investment in time, energy and money. He risks what most of the “buzzards” who criticize him with hateful words would never understand, let alone risk themselves. Hang in there Bob. Good people understand this economy and the government that is holding it back.
I love all of the conspiracy theories people!! These “rich” developers who are walking away with “millions” of course don’t risk anything or put up any money do they? They just rake in the millions and screw the masses with no risk and high reward. Makes you wonder why we don’t all just go develop some land and live the life of Riley! I’m sure that none of you Ninnymuggins who are posting comments here live in a developed community right? You live in tents in the woods right?
The reality is that these men and women risk a lot, work hard and make it possible for the rest of us to live in nice communities. They’re not screwing the county, they’re not screwing the board of supervisors, they ARE providing nice, affordable places to live and yes, they attempt to make (hold onto your seats)...a profit. GOD FORBID!!! Yes, they try to spend less than they earn! Oh the horror, what next?!?
I’d be willing to bet that 99% of you posting live in a developed neighborhood and like it. Well thank goodness that some money grubbing developer took the risk and spent the money so that you could do that.
Now go wash your Prius, feed your Labradoodle some organic gluten-free kibble and leave the rest of us alone please.
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