Floridians have long flocked to western North Carolina, so when a cloud settled over the Sunshine State real-estate market, Florida developers moved up, too (“Take the High Ground,” December 2007). “A lot were just looking for a piece of land,” says Terry Horner, president of the Asheville Board of Realtors last year. “They’d buy it, plat it, put some roads in and sell it for an inflated price.”
Or try to. Some observers say as many as 50 Florida builders might have been active in the region at the peak of the boom in 2007. Current state records show fewer than 25 Florida-based residential developers hold Tar Heel general-contracting licenses, and there are signs the slump they tried to outrun caught up with them. “We haven’t seen much coming out of the ground for the last two years,” Horner says. Adds Caroline Sutton, executive officer of the 725-member Asheville Home Builders Association, “I don’t think they’re having much input here.”
That wasn’t always the case. Until last year, Florida developers were prominent. Some projects such as Linville Ridge, near Boone and developed by a Naples, Fla.-based Lutgert Cos., were sold almost exclusively to Floridians. But in addition to the slowing economy — Horner says some projects stalled when prospective buyers were unable to sell their Florida homes — two spectacular failures marred the development climate.
One was last year’s bankruptcy and sale of Celebration, Fla., developer Bobby Ginn’s budding 6,000-acre Laurelmor golf community, near Blowing Rock (cover story, August 2008). The other was the collapse of the Village of Penland, a planned Mitchell County project of 2,000 luxury homes in which developers — two were from Florida — allegedly used inflated appraisals and other means to swindle buyers out of $100 million. N.C. Attorney General Roy Cooper shut them down in 2007.
Nevertheless, builders and real-estate agents say outsiders continued flowing into western North Carolina in sufficient numbers to cause concern — flatland building techniques don’t translate well to slopes. The home-builders association — about 350 of its members are builders — created a coalition called the Mountain Council for Accountable Development to head off problems. “There are different ordinances here and building techniques, and permitting processes are different than where they came from,” Sutton says. “One bad experience or developer can give a bad name to the rest of the group.” What comes next depends on the construction market, still weak in Florida and showing only modest strengthening in western North Carolina.
That’s the brakes
In an automobile industry hammered by recession, Continental Teves’ decision to expand its brake-caliper plant in Fletcher by 338 jobs has a nice ring to it. “The bottom line was good jobs” — averaging $36,179 a year — “at significantly above the county average wage of $31,252,” says Kathy Neal, spokeswoman for the N.C. Department of Commerce. The announcement bucked a trend in which original-equipment makers nationwide had been trimming jobs because of sagging car sales and could indicate early stirrings of a rebound. But it came less than two months after the company, a subsidiary of Hanover, Germany-based Continental AG, laid off about 90 workers at a plant that makes anti-lock brakes in Morganton, less than 70 miles away. It stands to collect more than $2 million in state incentives for the new jobs. “They’re two separate operations,” Neal says. Workers who lost jobs in Morganton can apply for those in Fletcher, a Continental spokeswoman says.