Kitson & Partners president and chief investment officer Tom Hoban explains how Babcock Ranch, the master-planned town north of Fort Myers, held its power through Hurricane Ian, from buried distribution and hardened solar transmission lines to wetlands kept in the plan for stormwater.
00:00:01:03 - 00:00:24:19
Mike Collignon: I know sometimes I open these webinars with a real and true observance or holiday mention, and while some of you might find it cheesy, today I fully embrace that cheesiness as we are live on National Cheddar Day. Yeah. How apropos. I knew we'd get a webinar to fall on one of those observations, but switching now from cheese to housing.
00:00:24:20 - 00:00:52:12
Mike Collignon: Have you heard of Babcock Ranch? If not, you're about to. When Hurricane Ian ran over Florida in October 2022, it caused an enormous amount of devastation in the Sanibel Island, Fort Myers and surrounding areas. Nearly 2.7 million Floridians lost power. However, one community stood resilient as ranch. This master planned, sustainable town just north of Fort Myers never lost power.
00:00:52:15 - 00:01:11:25
Mike Collignon: So how did they do it? Well, here to tell us is Tom Hoban, president, chief investment officer and partner of Kitson and Partners. Tom has over 27 years of experience in the real estate industry, which includes a broad understanding of the capital markets. He helped set the strategic direction for NP and is responsible for the financial division of the company.
00:01:11:27 - 00:01:29:29
Mike Collignon: Now, Tom is going to give us a short presentation, and afterwards he's going to be joined by the creator and teacher of the housing 2.0 program, Sam Raskin. They're going to have a conversation about Babcock Ranch and the broader topic of resilience. But before we get started, we need to recognize our sponsors. The first is Panasonic Healthy Indoor Living Solutions.
00:01:30:02 - 00:02:03:28
Mike Collignon: They help builders across the country differentiate themselves with powerful, code compliant and cost effective indoor air quality solutions that provide a safer environment for home buyers. And we also have LG, who is the leading proponent of the electrification movement. And they're proud to pave the way with arguably the broadest portfolio of home electrification products, from air to air and air to water heat pumps for HVAC, water heaters, clothes dryers and washer dryer combos to advanced energy storage systems, EV chargers and super efficient appliances, including the industry's first Energy Star certified induction Cooktop.
00:02:04:04 - 00:02:26:25
Mike Collignon: LG's innovation and technology will help us promote decarbonization and collectively create a better life for all. Now, during the course of today's presentation and discussion, you can submit questions for Tom and awesome. Simply use the questions box inside the go to Webinar Control panel. I'll review those questions and ask those on your behalf after the discussion. Now here to say a few words.
00:02:26:29 - 00:02:28:15
Mike Collignon: Sam Raskin.
00:02:28:18 - 00:02:57:20
Sam Rashkin: Hey, thank you, Mike, and welcome everyone. I wanted to start this one off before I hand it off to Tom. By letting you all know this is a first for us. We're doing what we call housing leader discussions. There are there are various players in the industry, developers, builders and other architects who are just pushing the industry to the next level and the learning and gaining knowledge that we believe should be shared with the rest of the industry.
00:02:57:21 - 00:03:20:02
Sam Rashkin: So these are not like normal presentations. What we normally do when we bring in a housing leader for this discussion is we'll start off with them giving a short background about their project and why it's unique. And then we'll jump into discussions and really dive into what's really behind their motivations. To be upfront leading the industry. So today I'm very excited.
00:03:20:02 - 00:03:38:23
Sam Rashkin: We have a really amazing new development. We're not selling new anymore. Babcock Ranch and Tom Hogan's here to kind of inform us about everything they're learning. So with that introduction I'm going to hand it back to Tom. Then he and I will have a discussion. Hey thanks everyone. Here's Tom.
00:03:38:25 - 00:03:54:02
Tom Hoban: Thank you Sam, and thank you Mike as well. It's a pleasure to be here. And Sam, thanks for inviting me. It's a real it's a real honor. I've got a lot of respect for you and what you've done to help move the industry over your career. And even the time you spend with the ranch was was very, very valuable to us.
00:03:54:02 - 00:04:11:15
Tom Hoban: So I appreciate you bringing me into this conversation today. Happy to share a little bit of background. I'll be pretty quick. So I think the main the main thrust is for Sam and I have a good chat, but just to lay the foundation gets into partners, we can advance the slide. We're a real estate developer here in the state of Florida.
00:04:11:17 - 00:04:43:21
Tom Hoban: We've got roots back to the early 90s as a company. And over the course of that, that that history largely master planned community focus for that entire run. We were northeast based, originally made our way to Florida in the mid 90s for a couple projects, and decided to really kind of drop anchor here in Florida and get very focused on the state, just given the growth down here and given the pro-development mindset of local government, just a much more conducive place to do our business than the northeast.
00:04:43:22 - 00:04:58:29
Tom Hoban: We really migrated from the Northeast to Florida mid 90s. And by the early 2000 we're really dedicated to Florida. I came down and joined CED in 2003. He and I have been partners ever since.
00:04:59:01 - 00:05:23:04
Tom Hoban: We're very proud of what we've done. We've been able to assemble an incredibly talented advisory board here. You can see at the bottom of the slide who have been very influential to us over the last 15 years and helping us, you know, things we otherwise would not have on our own opening doors, helping us drive strategy and really think through pros and cons of building a new town, which is a Babcock ranches.
00:05:23:07 - 00:05:26:22
Tom Hoban: Next slide please.
00:05:26:24 - 00:05:55:12
Tom Hoban: So Babcock Ranch he's looking at here is you'll see on the right a green and red colored area. The two combined were the original Babcock Ranch, which was 91,000 acres. We bought that back in 2006 from the family, the Babcock family, who had owned this land for 100 years, and the family was in the agricultural business, the forestry business, the mining business and the cattle business.
00:05:55:14 - 00:06:19:19
Tom Hoban: And they worked a working ranch here on the property. And we bought the land back in 2006. And I'll get to the next slide. We knew that the state of Florida had a keen interest in go back, had a keen interest in the land because the land was a missing piece between Lake Okeechobee and the center of the state and the Gulf of Mexico, or Charlotte Harbor Basin on the west coast to a natural corridor.
00:06:19:24 - 00:06:37:24
Tom Hoban: They were looking to create a wildlife corridor across the state of Florida, and this was the missing piece. So we knew the state was very interested in buying this land. The state was trying to buy this land in the family. We stepped in and got it done and turned around and sold 80% of it. So 73,000 acres of the 91,000 acres was sold to the state of Florida.
00:06:37:24 - 00:07:01:26
Tom Hoban: And Lee County, which is the area you see in green. And we were left with the red area there, which is 18,000 acres to build Babcock Ranch. And if you look at this map, you know what you'll see. You know, again, for those that aren't familiar with Florida, but there's a there's a inset map on the lower left hand side of the page there that shows where Babcock ranches with the logo on it, so you can get a better sense of where it sits within the state, within that specific region.
00:07:01:28 - 00:07:25:08
Tom Hoban: We're about 20 to 30 miles, depending upon what you call the coast, because the coast has the Charlotte Harbor basin. But the Gulf of Mexico obviously is further west, so we're about 20 to 30 miles inland. And if you looked at a map of Babcock Ranch, what you find is that we're about 20 to 30ft above sea level across the property as well, which for most people in the country doesn't sound like a lot.
00:07:25:09 - 00:07:47:25
Tom Hoban: But here in Florida, which is pretty flat, you know, flat as a pancake, that's a virtual mountain here in the state. So we have some pretty good natural resiliency to us, given our location in land, in the topography of the site being 20 to 30ft above sea level. Next slide please. This this next slide illustrates what I was talking about earlier.
00:07:47:25 - 00:08:02:01
Tom Hoban: If you look at the inset insert on the upper left hand side of the slide where the red rectangle you see on the right hand side of that red rectangle, that's Lake Okeechobee, big body of water here in the center of the state. And then if you look to the left hand side of that rectangle, that's the Gulf of Mexico and the Charlotte Harbor Basin.
00:08:02:01 - 00:08:21:06
Tom Hoban: Babcock ranch sits right in the middle of that. And was the missing piece that the state of Florida was looking to connect the link to the Gulf, that natural wildlife corridor. So that really helped us cattle as a catalyst, helping us get this deal over the goal line back in zero six. Next slide please.
00:08:21:08 - 00:08:43:17
Tom Hoban: This is a zoom in of the 18,000 acres that we that we ended up owning after the sale to the state. And what you'll see there is this a master plan. It's a master plan that has entitlements for 19,500 homes and 6,000,000ft² of commercial space, should be home to about 55,000 people. When all is said and done at build out today, we've got about 11,000 people living there.
00:08:43:17 - 00:09:01:11
Tom Hoban: Today, the areas on the on the bottom you'll see purple, orange and pink. The purple area is the western side of the project. That's where we started. That's really the first phase. And as you kind of work yourself from the left to the right, that's really working yourself from the west to the east, you'll see that orange yellow in the middle.
00:09:01:11 - 00:09:19:26
Tom Hoban: That's, that's that's the second phase. And then on the far right hand side in pink, that's the third phase of Babcock. If you look north up top on the in the yellow part, that's our solar farm. And that sits on just under a 900 acres of land and just under 700,000 panels of solar, which we'll get into. For what?
00:09:19:26 - 00:09:38:19
Tom Hoban: What the time was the first solar powered town here in the state and in the world, which is a big effort. We we put forth back and we bought the property back in those six. We'll talk about that a little bit later. Next slide please. So we straddle two counties Charlotte County and Lee County. You'll see there Charlotte County gray shaded on the north.
00:09:38:21 - 00:09:55:19
Tom Hoban: Lee County green shaded on the south. You'll see that gray image in the middle there, 80% of which is basically in Charlotte County, 20% of which is in in Lee County. And if you go to the next slide, this is just helpful. I think some people are probably wondering, what does 18,000 acres mean? How do we put that in context?
00:09:55:20 - 00:10:25:13
Tom Hoban: So if we go to the next slide, which you're looking at in this next slide is the island of Manhattan. And if you click on the next slide. This is an overlay of Babcock Ranch on top of Manhattan. So we're actually larger in landmass than the size of Manhattan. We're 28mi². Manhattan's about 23mi². Just to help bring some context to it, if you click the next slide, what you'll see is the landmass that makes up Miami, which is 36mi².
00:10:25:13 - 00:10:52:00
Tom Hoban: And again, if we keep advancing slides, we'll overlay Babcock Ranch, which is 28mi². So it's a big it's a big site. It's a really big piece of land. And with that comes a tremendous amount of responsibility and obligation to make sure we're doing things the right way and setting up a very long term, thoughtful master plan and strategic plan to build a new town which will be home to 55,000 people.
00:10:52:00 - 00:10:56:01
Tom Hoban: So let's keep going to the next slide.
00:10:56:04 - 00:11:16:28
Tom Hoban: Where are we today? I talked about it earlier. We just under 20,000 homes and 6,000,000ft² of entitlements in southwest Florida. The Cape Coral Fort Myers MSA is one of the fastest growing in the country. We were the first solar powered town in the US, working with Florida Power and Light on their 150MW solar on the north side of the ranch.
00:11:17:01 - 00:11:39:10
Tom Hoban: When we are fully built out, whenever that time comes down the road, at 55,000 people and 6,000,000ft², we will still be a net producer of energy. We will consume less energy than we produce on site, and we'll be net giving energy back to the grid at Babcock Ranch, which we're very proud of. As I mentioned, we sold 73,000 acres to the state of Florida.
00:11:39:12 - 00:12:08:08
Tom Hoban: We have about 100 miles of trails throughout Babcock Ranch, very kind of outdoor, environmentally sensitive community. To date, we've sold just over 4500 homes. Average price point in 2024 was just under $500,000. We sold about 800 homes last year, putting us 10th in the US on the John Burns annual Master Plan Top Master Plan community selling list. We've sold over half of our lots to builders at this point, so we're halfway through the lot.
00:12:08:09 - 00:12:28:05
Tom Hoban: Sale side to builders was a long way to go on the home sale side. And again, resiliency is a big part of our of our foundation. And we'll talk about that here throughout this presentation. But also Sam and I'll get into that in our chat. We've done a lot there that we'll get into. We also adopt the Florida Green Building Coalition standards for all of our land development and for our homes.
00:12:28:05 - 00:12:49:12
Tom Hoban: So everything has a minimum of a bronze certification on the home side. And even on the horizontal infrastructure side, we are we are also a minimum bronze certification on all horizontal development from Florida Green Building Coalition perspective. We thought technology was very important. We've got fiber to every home and business at Babcock Ranch, anywhere from one gig up to ten gigs, depending upon what you're looking for.
00:12:49:15 - 00:13:21:03
Tom Hoban: And we own and operate our own water and wastewater and reuse utility as well, which is called Town and Country. So very, very different than a typical, you know, what would be considered large for our industry, perhaps, you know, 500 to 1500 homes on a master plan, communities probably in a large master plan community mindset for many in our industry, this is this is obviously much larger, 18,000 acres, 28mi² and 55,000 people at buildout.
00:13:21:03 - 00:13:31:04
Tom Hoban: So a much different approach to how do you do that given the size and scale of the project? Next slide please.
00:13:31:06 - 00:13:44:13
Tom Hoban: This is just the lowest of the top ten that came out a couple weeks back from John Burns showing where we sit relative to our peer group out there in the country. You'll see a lot of Florida names on this list, given the growth we've got down here in the state. Next slide please.
00:13:44:16 - 00:14:05:07
Tom Hoban: You know, now this is interesting. This is something we contracted for the Babcock Ranch property back in July of 2005. And if you look this was a basically a tear out from a deck we put together back then. And it's the exact same today. Nothing has changed in terms of what we consider to be the core values, the core community initiatives for Babcock Ranch.
00:14:05:08 - 00:14:29:00
Tom Hoban: This was the this was the focal point for us when it came to planning, designing and strategy for Babcock was focused on the environment, focus on energy, education, health and wellness, transportation, technology, resilience and storm safety and fund those. Those are the those are the ingredients in the pot that we felt we needed to get right in order to make Babcock Ranch a successful community and a successful town.
00:14:29:01 - 00:14:48:21
Tom Hoban: As we looked ahead ten, 15, 20 years into the future. So we're very proud of this roadmap. We're proud that we stuck with it. We've had a lot of discipline. The way to get there has changed and the path forward change, certainly from from closing in 2006 and adjusting for what happened to the world during the great financial crisis of 2008, 2009.
00:14:48:23 - 00:15:03:04
Tom Hoban: That's caused us, that caused us to kind of redirect a bit on strategy to move forward. But those pillars have remained constant and we believe have really helped us create an incredibly unique community in town for folks to live in. Next slide please.
00:15:03:06 - 00:15:25:09
Tom Hoban: So environmental responsibility is at the tip of it. Talked about it earlier. When you sell 73,000 acres to the state of Florida and you're surrounded by nature, you better pay attention to it. You better make it a priority. And we have we've really embraced it. We embrace the environmental community. We really wanted to help, you know, deliver on the mission and the vision of Babcock Ranch being a sustainable community.
00:15:25:10 - 00:15:45:19
Tom Hoban: Part of that is living well with nature and coexisting with nature. And so when you go through Babcock Ranch, you'll see a lot of imagery like you're seeing on the slides here. You'll see as you drive through Babcock, very proud of our of our ability to coexist with the nature, habitat and species within Southwest Florida. Next slide please.
00:15:45:22 - 00:16:03:21
Tom Hoban: More, more to this. When Sam and I chat. But but you know, wetlands, natural flow ways. We spent a lot of time early days at Babcock on the master plant, figuring out where to draw the lines on the page to develop in areas to stay out of, even to figure out which land we would sell to the state versus which we would keep for development.
00:16:03:22 - 00:16:34:25
Tom Hoban: You know, we sold 80% of the land of the state for permanent preservation of the of the 20% we kept, which was the 18,000 acres that we currently own, roughly half that is also in preservation. So 9000 more acres of preservation. So when you step back on a 91,000 acre site, 90% of it is in permanent preservation. And a big part of that was looking at the actual old maps from hundreds of years ago of the flow as natural flow ways of water on the site, and how water moved across the site and really wanted to maintain that.
00:16:34:26 - 00:17:00:18
Tom Hoban: You know, we've been in this business quite a while. We've learned that Mother Nature packs a punch and she tends to win. So rather than fighting it, we thought we'd master plan in consideration of it. And so you'll see. A Babcock Ranch is a lot of preservation of natural wetlands. And when you think about storm resiliency, oftentimes people think about their homes and the structural integrity of their homes, which is clearly important and critical from a sustainability and resilience perspective.
00:17:00:18 - 00:17:27:21
Tom Hoban: But arguably as important is the ability to let water flow and drain through through the property and not flood the community. And so flood is has become a tremendous risk here in Florida during the storm seasons and the ability to have, you know, hundreds of acres of wetlands and keeping natural flow intact for water to flow properly into those wetlands creates a huge reservoir storage for us, which keeps our town from flooding as well, which is a big part of our story.
00:17:27:28 - 00:18:01:03
Tom Hoban: Next slide please. This is an example of us not just not just staying out of the wetlands to be sensitive to them and preserve them, but actually investing back in them. And as I mentioned earlier, the family had done ag work farming cattle, timber, etc. and impacted the land through that business. Again, looking back at the maps, we were trying to find these natural flow ways and we reinvested into restoring those wetlands with with building weir systems to help put the water back where originally was and flowing accordingly.
00:18:01:03 - 00:18:15:15
Tom Hoban: So what we've been able to do is rehab at different pockets across Babcock Ranch to bring that ecosystem back to life, which creates a long term, vibrant water flow water management system as well. Next slide.
00:18:15:17 - 00:18:34:25
Tom Hoban: Is a picture of our of our Florida Power and Light Solar Energy Center. Again, I mentioned earlier, sits on roughly almost 900 acres of land and just under 700,000 panels of solar photovoltaic. It also has what you see there in that picture in the lower left, which was the first of its kind back in 2009 when we agreed to do this.
00:18:34:26 - 00:18:57:00
Tom Hoban: This was a solar to battery storage facility, which gives us the ability to redistribute power when the sun is not out. So when the sun goes down at night on cloudy days, this part of the of the of the solar array enables us to distribute power for about four hours thanks to the soda battery storage technology. Babcock ranch next slide.
00:18:57:03 - 00:19:21:05
Tom Hoban: A snapshot of kind of some of the areas of focus when we talk about environmental sensitivity and sustainability. Talked about being the first solar powered town. I just mentioned the solar Plus storage system. I've talked about the sustainable water management system. We also have what we call a continuous monitoring, the adaptive control stormwater management system, which is basically all of our lakes at Babcock Rancher interconnected.
00:19:21:05 - 00:19:46:23
Tom Hoban: And we connect to the Noah, which allows us to do predictive analytics when storms are coming into town, i.e. hurricane season, storm season. Those predictive analytics can help us figure out what type of rainfall is coming, what that's going to do to the water levels in Babcock Ranch, and we can move water around through our integrated system to, again, help mitigate flood risk throughout the community.
00:19:46:24 - 00:19:59:26
Tom Hoban: So very proud of that. I talked about the Florida Green Building Coalition, the building standards in general, environmental respect for the land based upon the way we've done our master plenty of Babcock Ranch. Next slide.
00:19:59:28 - 00:20:19:04
Tom Hoban: So hitting the nail on the head here, Mike mentioned it. Sam mentioned it in the intros. You know, you spent a lot of time and effort in the early days, planning and engineering and designing to help yourself set your community up for success. And certainly when you're coastal or down in the southwest Florida or Southeast Florida, you're thinking about storm activity.
00:20:19:04 - 00:20:44:16
Tom Hoban: And we did a lot of that back in 506. And for the next decade, planning and designing. And you never really know for sure until you're tested. And we got tested pretty significantly back in 2002 when Hurricane Ian came into town and hit the next slide, please. And and as Mike mentioned in the introduction, what you're looking at here on this slide, on the top is the map of Hurricane Ian.
00:20:44:16 - 00:21:03:11
Tom Hoban: You'll see a yellow star in there for for signifying where Babcock Branch is located. You can see it's right in the middle of that path. Hurricane Ian just devastated southwest Florida back in 2022. Ravaged Fort Myers Beach, Sanibel Island Captiva continued moving northeast, and it came right across Babcock Ranch and sat on top of us for eight hours.
00:21:03:13 - 00:21:28:29
Tom Hoban: It was moving. It was moving very slowly with with very strong winds of 100 miles an hour sustained and up to 150 mile gusts, and sat at the top of us for that eight hour stretch and really destroyed most of what was around us. You know, the next day when the sun came up, we looked around the property, all the planning and design work we had spent years doing and a lot of dollars doing had worked.
00:21:29:06 - 00:21:49:25
Tom Hoban: We never lost power, we never lost Wi-Fi, we did not flood. And we own and operate the water utility. The water utility was operational, functional. We didn't have to go on a boil water notice. And we were the only community in Southwest Florida that could say that. And so, you know, it was a moment of of concern, clearly, when the storm was hitting for all of us in southwest Florida.
00:21:49:27 - 00:22:10:08
Tom Hoban: And it was certainly a moment of question marks as to how we were going to perform. And, you know, on the other side of that, we're credibly proud of how tall Babcock stood during that time and really became a bit of a safe haven for the region, given we had power and can keep the lights on and our shopping centers could keep the lights on, people could come and get their groceries at our at our public shopping center.
00:22:10:08 - 00:22:43:16
Tom Hoban: We had just opened a brand new 40,000 square foot field house there that doubles as a storm shelter for the region in times of storm, and we've had upwards of 2000 people sheltering at Babcock Ranch for safety and security. So incredibly proud of all that work and effort that we put in and planning that we put in over the years to get to that point and excited about that outcome in that activity, which used to maybe be referred to as 100 year activity or 50 year activity, has become more of an annual or every other year activity here in Southwest Florida with the storms that you're seeing on the lower side of the slide.
00:22:43:17 - 00:23:17:18
Tom Hoban: On the left hand side is, I believe, Helene, a tropical storm. Helene, you can see its path. And where Babcock West, we're a little bit southeast of the major impacts of that path, but still felt the rains and the winds from Helene this past year, and then Milton on the right, which was much more, you know, on the outer edge of that band of Babcock Ranch and again felt the activity in the winds and the rains from those and similarly came out relatively unscathed from a storm perspective, never lost power, you know, didn't flood, etc. and had a place for our homeowners to shelter in place at their homes and safety.
00:23:17:20 - 00:23:43:07
Tom Hoban: And so the next slide is just a bit of a snapshot of how the media picked up on that. Everything from NPR, you know, we ended up on 60 minutes a couple weeks after Hurricane Ian, based upon how we performed different magazines, different articles. So again, very proud. And it seems like the world's paying attention a bit more, and people are taking note as to what's happening in Southwest Florida, what's happening at Babcock Ranch, and the question of how did you do it?
00:23:43:08 - 00:23:50:01
Tom Hoban: Which we'll talk about again, more with Sam here in a few minutes. So keep keep going, please.
00:23:50:03 - 00:24:07:18
Tom Hoban: This is just a town and country utility. That's the water utility that we don't operate. Next slide please. This is a this is a picture of our commercial master plan. And what you'll see here is a bunch of, sites filled in with with with lots and homes. Those are the residential neighborhoods. And you'll see a lot of gray shaded areas.
00:24:07:20 - 00:24:32:26
Tom Hoban: Those are our commercial zones. And we've got right now we're actively working out about one point 2,000,000ft² of commercial product. That's in some form of development or planning at the moment, and also about 1200 or so multifamily or built to rent neighborhoods for rental as well. Next slide please. Quick shot of our population. We sit right around 11,000 people as of as of year end 2024.
00:24:32:26 - 00:24:46:03
Tom Hoban: And given the home sales we're experiencing and the growth we're seeing, we expect that to be about 26,000 people by 2028. So we're growing very quickly. Down in Southwest Florida, very proud of that as well. Next slide.
00:24:46:05 - 00:25:04:10
Tom Hoban: Okay. And this is Mary. The rest of these slides you can just click through every couple of seconds. It's just really to share with the groups and imagery help help the group visualize what we're doing at Babcock Ranch and some of the amenities. We've got some of the iconic structures, and also showcasing and highlighting how nature really intersects with the town.
00:25:04:12 - 00:25:18:28
Tom Hoban: And that's been keep going. Mary. That's the that's the formal part of the presentation we can break here once Mary clicks through and jump back to.
00:25:19:01 - 00:25:31:10
Tom Hoban: I can have a nice chat.
00:25:31:13 - 00:25:57:14
Sam Rashkin: Has a great I am so glad you were here to present this story about Babcock Ranch. I don't think enough people understand the connection between business outcomes and doing well and being more responsible as a developer, so your story is just so important to us, Tom, and I'm so grateful you here. I have way more questions and we'll probably have time to go through.
00:25:57:14 - 00:26:24:08
Sam Rashkin: So let's just go at them and just see how far we get. And so thank you so much for being here. And I always like to start the first question by going after the wide message for such a special place to live, you have so much to talk about again environment, energy, education, health, transportation, technology, resilience, storm safety fund.
00:26:24:11 - 00:26:42:08
Sam Rashkin: If you had seven words or less and someone was asking, why should I choose to live at Babcock Ranch, spend where I spend 70% of my life in my house and my community? Why should I choose to live there? Tom, what would you say just in that first introduction?
00:26:42:10 - 00:27:04:22
Tom Hoban: Yes, that is a phenomenal question and we've struggled with it. Sam, to be candid with the our board would ask us that question, what's the elevator speech when you meet somebody and how do you how do you sell Babcock Ranch? And it's a challenging question to answer because unlike a lot of communities, which are kind of focused on one thing, I were going after an age targeted buyer, we're going after an assisted living.
00:27:04:23 - 00:27:46:18
Tom Hoban: We're going after the young folks. We're a multi-generational town. So it's a very, you know, unique selling proposition of living in a hometown. And there's not a lot of hometowns like this in Florida. There's a lot of subdivisions, there's a lot of gay communities, there's a lot of vanilla ice cream, but there's not a lot of differentiation. And so if you really want to live in a town, a multi-generational town where grandparents and grandkids live in different communities, neighborhoods within that town that's rooted in sustainability, innovation, you know, and environmental stewardship, you know, Babcock is a pretty good place for you, like you said, schools, shopping, health care, medical recreation, hiking trails, biking trails,
00:27:46:18 - 00:28:03:21
Tom Hoban: helping us all that's there. And that a lot of those things that are there transcend that generational divide, right? Those are things that all generational aspects and demographics are looking for, maybe differently, but they're all looking for that, prioritizing that. So we like to say that we also like to say that it's, it's a place to live where you have peace of mind.
00:28:03:23 - 00:28:19:10
Tom Hoban: It's a place we can create worry free living. You know what? You what you need is here. We're going to bring it to you. We're going to embrace technology, innovation to bridge the gap. Or physical. Maybe brick and mortar isn't ready. We can use virtual to help help bring it there. And so how do we create this mentality?
00:28:19:10 - 00:28:40:23
Tom Hoban: I think people are post-Covid. Mindsets have shifted quite a bit and some of its fate and some of it's stuck. But the idea of having peace of mind and comfort and safety and outdoor living, health and wellness, those seem to stick. And having a community where that is one of the primary focus of the community that seems to be working and it seems to resonate with the marketplace.
00:28:40:26 - 00:29:10:01
Sam Rashkin: That's a great answer. You know, in housing 2.0, I use a two word why for optimized communities, and its place matters. And so, and I think everything you're doing is about making place that matters. You know, again, all your key components, all that. That's great. I think, you know, that's the soul searching exercise and price houses to get to the core of why they exist and be able to have a simple way into sharing it.
00:29:10:01 - 00:29:40:29
Sam Rashkin: That's great. So I want to jump in right now with just the education part a little bit. That's a big deal, that you are the lone community standing and not just standing, standing with resilience. When I say resilience, there's disaster resistance during the event and then there's resilience after the event, the post-event resilience. You had both and you went through a great background if you would just highlight from the presentation.
00:29:41:06 - 00:29:59:02
Sam Rashkin: What do you think were the most compelling measures that Babcock Ranch used to optimize resilience and get that kind of result, that kind of amazing success resisting storms. What would you think are the most important features?
00:29:59:04 - 00:30:16:03
Tom Hoban: Yeah, that's another great question. It's gosh. And it's like a it's like 15 years in the making because it's been we've been at this for so long. And so, you know, I would say there's so many pieces to it, Sam. But when you think about that I agree with you 100%. There's kind of the resilience of the the storm itself.
00:30:16:03 - 00:30:33:16
Tom Hoban: And how do I survive the storm successfully? Then there's the aftermath of the storm and how do I live my life once the storm, you know, passes by. And so those are two areas of focus we've had. And there's some fundamental things, right? If you really want to try to break it down and try to make it simple, you know, I touched on the geography of Babcock Ranch.
00:30:33:16 - 00:30:53:16
Tom Hoban: So our location is obviously is a big assist for us. We're inland and we're upland. And not everyone can say that in Florida. So we've got we've got that going for us. Beyond that, the ability to typical developer will come in and look to mitigate as much wetland as they can to create upland, because that's where they get their revenue.
00:30:53:17 - 00:31:18:22
Tom Hoban: By creating upland, they can sell land to a builder or build an income producing asset. And so there's a lot of mitigation of wetlands, which takes away storage and takes away, you know, pervious materials and puts in impervious materials, which creates bigger issues on flooding. So I'd say location, geography of the land. I'd say the embracing of the wetlands, investing into creating more wetlands through our we're system to create more storage for water.
00:31:18:24 - 00:31:37:25
Tom Hoban: Those are two pretty big things that we had going for us that we that we kind of embraced right out of the gate. Power. Right. Power is a big deal. And, you know, we caught we courted Florida power and light for years. You know, we we we started calling them in 2005 when we contracted for Babcock Ranch.
00:31:37:25 - 00:32:02:07
Tom Hoban: We closed in 2006. We kept that courtship up, chasing them. They agreed to come in and do something special at Babcock in 2009. But given the market and given their regulated utility, they're not allowed to build new utilities unless it's at the least cost option, which was natural gas for a long time. So it wasn't until 2015 we're solar became at pa pa cost.
00:32:02:07 - 00:32:31:03
Tom Hoban: With natural gas we can start building solar. And so having that relationship with the local utility for a project, the size and scale is incredibly valuable and incredibly helpful to helping you create that sustainability resilient path. And, when Irma hit, Irma hit, I want to say 2020. And Irma was a very similar storm to Ian, wasn't quite as intense, but as similar path threat over Babcock Ranch.
00:32:31:06 - 00:32:48:12
Tom Hoban: At the time, we had virtually nobody living at Babcock Ranch. We hadn't really kind of gotten into our groove yet selling homes, and we lost power when Roma came through and we couldn't understand it. You know, we had the solar field up the way, and we spent all this time and effort in that with Florida Power Line. We met with power and light it to explore what happened here.
00:32:48:12 - 00:33:05:23
Tom Hoban: Guys, you know what happened. Why do we lose power? How do we problem solve? How do we further harden the the grid here, the infrastructure around Babcock Ranch to ensure that when the next Irma comes through, we have a better result. And to their credit, you know, they rolled up their sleeves, they got creative. They engaged with us.
00:33:05:25 - 00:33:23:28
Tom Hoban: It was a very partnership minded approach. And they continued to harden, you know, the infrastructure and harden that that that energy grid around us to make sure that we had, you know, risk mitigation in place to help give us a better chance of keeping our power intact when things like that hit. And sure enough, two years later, Ian came in and and that that that lesson learned.
00:33:23:28 - 00:33:56:25
Tom Hoban: Irma seemed to pay some, some dividends often when Ian hit. So there's a lot there, Sam. But I think I think recognizing where you are in the footprint of the, of the region, not looking at your wetlands as just a place to kind of mitigate and create uplands for revenue, embrace it and figure out how to incorporate them into your plan for these, these moments of time that happen in these regions, having relationships with the utility company or a big deal and helping us get there, having everything buried underground, you know, that's obviously a huge risk mitigation.
00:33:56:25 - 00:34:15:05
Tom Hoban: Everything's underground. Right? So we're not all the poles that the transmission lines from the solar down to the substation at Babcock Ranch, that's not subgrade, that's on big transmission lines. Those are all concrete. Those are all hardened for storm, you know, for storm and for wind. So once it gets the substation, it hits Babcock substation. Everything there after is underground.
00:34:15:05 - 00:34:34:14
Tom Hoban: So the risk is getting from, you know, whatever that utility is to our substation. And once it gets to our substation, we've taken that risk off the table of getting underground. So all those things came into play. They're all part of the ingredients and the sauce that helped make it work. And again, I'm saying it's simply but that was that's 15 years in the making, you know, to do that.
00:34:34:14 - 00:34:47:15
Tom Hoban: It's not it's not an easy lift. And certainly size and scale, you know, increases the magnitude of the need. Right. We've got to be we got to think utility scale type stuff for Babcock Ranch.
00:34:47:17 - 00:35:18:03
Sam Rashkin: So 15 years in the making is such a stunning statement because 15 years ago so little this was on the radar screen for most people. And yet it was such a high priority for you. So maybe speak a little bit about what were the cultural makeup of the team at Babcock Ranch? What was in the culture that enabled such a forward looking priority and commitment to it, and investment in it?
00:35:18:06 - 00:35:24:07
Sam Rashkin: How that happened, it was just you were so ahead of the curve in such a.
00:35:24:09 - 00:35:44:05
Tom Hoban: What you say that because it's 100% true. And I think, I don't think we really appreciated it at the time as much as we did. As you know, post closing, we start talking to people like, what are you talking about? Right. You know, the term ESG didn't exist back in 2006. Even when we said ability to people, they'd say, what does that mean?
00:35:44:06 - 00:36:12:03
Tom Hoban: What's what's sustainability mean? So the world has come this way. Thankfully, I think the world's moved towards understanding and recognizing that there's importance to it. But but the simple answer, Sam, I think I showed that map earlier of Manhattan. You know, when we when we were getting down the road to getting close to buying it and closing on it, I think the sheer magnitude and scale of it, you know, even stopped us in our tracks a bit to, gosh, you know, we have a tremendous responsibility to do this the right way.
00:36:12:06 - 00:36:40:07
Tom Hoban: We have an obligation to do this in a way that doesn't impact, have a negative impact on, on those around us. And in fact, if we can figure out a way to make it a positive impact on those around us, we could really be, you know, changing the game here. And so we did spend a lot of time with the environmental community folks that, you know, Eric Draper, who was the the president of the Audubon Society, became somebody we counsel with quite a bit the WWF, the Florida Fish and Wildlife, even the Sierra Club, who challenged us originally once they heard our vision, understood what we're doing, actually came in, supported us and advocated for
00:36:40:07 - 00:36:59:06
Tom Hoban: us. So I think I think bringing that environmental community in helped change the name of it for us and gave us some good perspective and insights as well. And I think, you know, our board, our board is incredibly influential, and I think they've helped push us to places we otherwise wouldn't be on Jeb Bush, whose, you know, one of his passions is education.
00:36:59:09 - 00:37:15:01
Tom Hoban: You know, coaching us to lead with the school in the first phase of Babcock Ranch was unheard of for a developer to do with nobody living there. And yet we did it. And the school sold out to overnight with demand, you know, and helped us bring more homes in out of the gate. So turned out to be a pretty good decision.
00:37:15:01 - 00:37:35:27
Tom Hoban: You know, Larry Burns, former head of General Motors R&D, for years, pushing us on the transportation side to embrace autonomous vehicles and ended up helping us become the first community in the state that had autonomous shuttles running back in 2018 as a test pilot through the community. So I think, you know, we've had that, we've had that that guidance and perspective from others as well.
00:37:35:29 - 00:37:58:13
Tom Hoban: But but really the the call was really just, gosh, if we're going to do something that's going to have 55,000 people, we need to embrace trends. Look ahead. What is the future look like? Not what does the past and present look like. Tear off the rearview mirror and start looking at the windshield. You know, where are we going and how do we start package protecting and somewhat trying to future proof around it from a planning perspective, knowing it's all going to change and it's all going to evolve.
00:37:58:18 - 00:38:17:25
Tom Hoban: But, you know, plan for flexibility and adaptability. But you know, those key tenants that I put up there and that one slide. Yeah, that's not rocket science, right? I mean that's just that's that's just kind of looking at what makes you said earlier saying we're huge proponents of placemaking and thinking about where you live, places you've been in vacation, restaurants you've been to, whatever it is.
00:38:18:00 - 00:38:39:13
Tom Hoban: Certain places resonate in certain places don't. And what did you like about those places? Why did you choose to live there? And when you stack up those things I listed on that slide, you know, we felt like those would be things that we could get those right. We'd be satisfied the needs of the masses to live there. And part of that's just being thoughtful, being sustainable, embracing change and putting your innovative, you know, innovative thinking cap on.
00:38:39:15 - 00:39:05:04
Sam Rashkin: That response is a warm fuzzy for me because virtually everything has 2.2.0 program advocates is good. Things happen when you optimize user experience. If you have that lens and let everything else kind of happen around it, the profits will come. But if you really have that focus on the end user, it's such a compelling point, which is what you're saying.
00:39:05:05 - 00:39:41:16
Sam Rashkin: Really, you thought about all the things that you would want living here and use that as a basis for what you did, but then something happens when you lose a little bit of control. You got to bring in builders and they have to match your culture, your priorities. So let me ask, what was there anything you asked them to do that they had to do to match your priorities around resilience or the things that the builders included that were not required by code that helped build on what you did as a developer?
00:39:41:18 - 00:40:01:03
Tom Hoban: Yeah. Look, I think we're very fortunate. We've got we've got the best builders in the country about the Babcock Ranch and said, you know, all these guys and you've spent some time with us on property. And I know you go years back with the builder, homebuilder industry. They're they're great at what they do. They've been incredible partners to us.
00:40:01:05 - 00:40:10:12
Tom Hoban: We're cognizant of the fact that they're they've got to make money, right? They've got to make their their targets and hit their margins. So we're trying. Pardon me.
00:40:10:15 - 00:40:13:18
Sam Rashkin: They're funny that way. They want to make money.
00:40:13:21 - 00:40:27:20
Tom Hoban: Yeah. Imagine that. They're not they're not in the not for profit business. And they've got most of them are public companies. They got Wall Street breathing down their necks. So so we appreciate that. And we're not looking to push them into the corner to do things that don't make sense. Just to click a box or check a button or get a badge.
00:40:27:23 - 00:40:28:21
Tom Hoban: Is there anything.
00:40:28:24 - 00:40:33:00
Sam Rashkin: Ask them to do that.
00:40:33:02 - 00:40:53:08
Tom Hoban: The big thing, the big thing is the green building standards that we think are important. And we think those are much more practical for us in Florida than anything else. And embracing those, understanding those, and making that the standard that's the base is the minimum. That's the bare minimum. Everyone's going to be bronze bare minimum. And that's not that's not an unreasonable position for us to take.
00:40:53:08 - 00:41:10:09
Tom Hoban: And the builders agree with that. I think when you build in South Florida, which is where we are, and all these builders build in those regions, the codes are pretty stringent in South Florida. It turns out the codes work. You know, when you look at what happened, you know, back when let me.
00:41:10:12 - 00:41:13:12
Sam Rashkin: It's a good point. You know, the codes have come a long way.
00:41:13:14 - 00:41:14:10
Tom Hoban: Those are.
00:41:14:13 - 00:41:37:21
Tom Hoban: A long way. So structurally, you know, if you build a code, you're going to be in pretty good shape with your home. If you do Florida green building standards, you're gonna be slightly better than that, which is where we are. And then if you really thoughtful about landscaping, you know, when you think about some of the issues that happen in these storm activities, you know, if you embrace native landscaping and use kind of what's natural to the region, it turns out it's a lot more resilient.
00:41:37:21 - 00:41:53:16
Tom Hoban: It's a lot more sustainable. It's used to being in that climate in that region, and you have less damage and less issues. So I think, you know, there's all the architectural things that we do with our builders. There's an architecture review committee, which we call the Founders Review Committee, that they've got to go through. So we have some sort of governance on the look and feel of the homes.
00:41:53:16 - 00:42:23:01
Tom Hoban: But the big thing is, guys, you know, Florida green building standards have to be kind of baseline bronze no matter what. Be thoughtful with your landscaping. Let's not be bringing in exotic, you know, materials that don't really belong in Florida because they're not going to sustain and survive. Those are two big ones. Turns out when we started peeling on an innovation and saying, you've been part of this with us, we find that in corporate, at the corporate side of these homebuilders on the public side, there's an incredible amount of thought and effort that is going into what the future of homebuilding looks like.
00:42:23:01 - 00:42:39:21
Tom Hoban: And they spend a lot of time thinking about this stuff. What they don't spend a lot of time doing is putting it in the field. And so what we've been able to do is, I think, bring a sandbox to the lab and get it out of the lab. And we've said to the homebuilders, hey, we're open for business with innovation at Babcock Ranch.
00:42:39:21 - 00:43:02:07
Tom Hoban: If you've got something that you've been exploring in corporate from an R&D perspective, but you're looking for a place to showcase it, test it, experience it, come to Babcock, you know, let's do it here at Babcock Ranch. And we've seen the builders respond to that. You know, we we did innovation way we helped. You were there Sam in 20 in 2019 hosted innovation workshop with our builders to see how we could push the envelope.
00:43:02:07 - 00:43:27:20
Tom Hoban: Back to your point to to improve the home homeowners experience. How does living in this home feel better if we can do these things? And what is that? Air quality, water quality, safety? Security? Materials? Sustainability, hers ratings, HVAC bills, all these things that can help improve the experience of the homeowner. How do we help push the envelope, bring some of those things into Babcock Ranch.
00:43:27:21 - 00:43:53:25
Tom Hoban: And so we landed on Innovation Way, which is a street in Babcock where Dr. Horton, Pulte and Lennar came in and built innovative homes with different building materials, processes and systems to showcase maybe the direction that the industry was heading, which we were excited about. That was a really great outcome for us. We're now we hosted a workshop back in 2022 and we're now working on Innovation Neighborhood, which, you know, innovation.
00:43:53:25 - 00:44:08:08
Tom Hoban: Innovation way was one road with nine homes. Now we're moving towards innovation neighborhood, which will be, you know, 50 to 100 homes that we're looking to further amplify innovation and in user experience, homeowner experience in those homes. And we're still exploring that.
00:44:08:10 - 00:44:41:13
Sam Rashkin: That's great. And let me ask you, is was there any response when you get so much publicity about resilience and performance after Ian, do you think insurance companies are recognizing and aware of that? And is there a pathway to where you have better access and better premiums in the future for the residents, or is that just just too big a challenge given the bureaucracy of the insurance industry?
00:44:41:15 - 00:45:01:23
Tom Hoban: Yeah, you're hitting a really important nail on the head. So to answer your question, I would say there is awareness and in recognition that something's happening at Babcock that's different. And if you look at a heat map of claims in southwest Florida and you see flaming hot red white heat in one area that's blue and cold, you wonder what's going on there.
00:45:01:23 - 00:45:23:29
Tom Hoban: So we have gotten a lot of inquiry from the insurance industry. We've hosted a lot of insurance companies, Babcock Ranch, educate them on what we're doing, and there's a lot of and interest in it. And we'd love to be a catalyst to help influence a change in terms of how how, master plan communities get developed and how that risk quotient changes with thoughtful design, etc..
00:45:24:05 - 00:45:49:29
Tom Hoban: We haven't yet seen the benefit, Sam, of hey, by the way, your premiums are extra percent lower because you've mitigated the risk, so it hasn't made its way into the underwriting yet. It needs to. The industry has got to get away from this macro data underwriting and get into the micro data. And if you look at the microdata, I think just objectively, obviously I'm a bit biased being a, you know, a Kittson and a Babcock, but just the pure risk quotient of, of of underwriting, a risk of insurance sure.
00:45:50:01 - 00:46:07:03
Tom Hoban: Ability at Babcock Ranch is significantly less than it is down the street. And so we have to figure it out. We're working on this actively. We're going to be working on this with the insurance industry to try and crack that code. It is very rare, right. And it is not easy. And you know that world better than most.
00:46:07:05 - 00:46:15:22
Tom Hoban: But we're working on it. It's important. We do believe we do believe we should see the benefit of that. And our homeowners should see the benefit of that by choosing to live at Babcock Ranch.
00:46:15:24 - 00:46:42:11
Sam Rashkin: Yeah. And building on that, you know, the I think the mortgage underwriting process is just a risk business as well. You know, it's all based on the actuarial numbers in terms of what's the probability I get paid back on this mortgage and the fact that both your resilient and therefore the position for higher value and all these elements that are better for the mortgage underwriter never show up in terms of maybe a preferred interest rate.
00:46:42:11 - 00:46:52:17
Sam Rashkin: So all these programs do not respond to some key factors that have to be eventually integrated into their calculations.
00:46:52:20 - 00:47:11:29
Tom Hoban: Yeah. Agreed. There's a whole there's a whole thread there you're pulling Sam. That's a very maybe it breaks beyond resilience. But just when you have something of this size and scale and you can design it, plan it the right way, and you can bring in and technology as part of that infrastructure, you can change the way you think about services and what the cost of those services are.
00:47:11:29 - 00:47:28:06
Tom Hoban: So I taxes. You know, so there's a there's a very big threat of, of, of just how do you think about this differently such that you can deliver higher quality experience at a lower cost? Can I give you a higher quality home at a lower cost and give you a higher quality experience at Babcock Ranch at a lower cost?
00:47:28:06 - 00:47:35:00
Tom Hoban: And that's a big picture idea that we've been pushing on. It's hard. It's not going to happen overnight, but we're chipping away at it.
00:47:35:03 - 00:48:04:17
Sam Rashkin: That's great. And let me ask, you know, if you had to estimate what percent of home buyers come to Babcock Ranch that are pre wired, recognizing the resilience and all the value that you've built into it, that's really invisible because you can't see health, you can't see resilience, you can see storm safety and even energy savings. So they're not pre wired coming in.
00:48:04:19 - 00:48:16:25
Sam Rashkin: What what do you think are pretty wired to come there because those are such significant advantages living there. Do you think it's a small percentage medium percent a high percent.
00:48:16:28 - 00:48:35:25
Tom Hoban: No it's a Sam. You'd be surprised. It's a very high percentage. There's an incredibly knowledgeable, incredibly knowledgeable home buyer base. You know, I'd say let me back up. I would say about right, about half of our home buyers are coming from somewhere in Florida, and the vast majority of that, 50% are coming from somewhere within 45 minutes of Babcock Ranch.
00:48:35:25 - 00:48:55:21
Tom Hoban: So they have been affected by storms. They've lived through storms. They know they know what that's like. And they've heard about Babcock Ranch and the Babcock Ranch. You know, branding and marketing effort is pretty significant. So a lot of those folks walk in the door because of that. That's why they're coming there. They're they've heard about the solar and they're curious.
00:48:55:23 - 00:49:26:21
Tom Hoban: They're they're their neighbors from their old neighborhood, moved there a year ago and are raving about, you know, how what a great place is to live and how safe and secure feels and storms. So so I think the words out there on the other half that are coming in that aren't Florida, you know, the majority comes in from the northeast and the Midwest and the words out there as well, it's not as pronounced as it is here locally, but I think there's a bit of a with with the whole 60 minutes, CNN, Forbes, all these things that that the media outlets that hit it, that go global, the story is was more well known than
00:49:26:21 - 00:49:46:29
Tom Hoban: you'd think. And I think that that outdoor health and wellness piece is a big part of that. The solar is a big calling card. People are curious about seeing the solar. They want to go there and see it and understand it. But I would say that that that resilience and the resilience, sustainability and outdoor lifestyle seem to be the things that resonate the loudest with the marketplace.
00:49:47:00 - 00:49:54:22
Tom Hoban: And when you pull our homeowners as to what drove you to show up here to shop, that's a big part of the story for sure.
00:49:54:25 - 00:50:16:13
Sam Rashkin: So the sales action goes when values understood, price becomes much less important. How do you how do you translate all this value? You have so much to offer. What do you think of some of the most effective ways? I know you mentioned already word of mouth is huge in terms of clarifying value, but what are the things that you do proactively?
00:50:16:15 - 00:50:24:25
Sam Rashkin: Is a developer and your marketing communications and other strategies? How do you just translate all this value? So much going on?
00:50:24:25 - 00:50:48:23
Tom Hoban: Here it is. And back to your earlier question about use seven words to to help articulate the why. It's hard. It's really hard. It is. So I think you spend a lot of time with our marketing department, with our PR firm, social media, digital media, doing things like this, Sam, that, you know, again, I'm so appreciative of having the conversation.
00:50:48:23 - 00:51:12:27
Tom Hoban: But, you know, there's a lot more ability to communicate via podcast, via webinars to get the word out. But it's a it's a whole spectrum of things that are under that that broad brush market of marketing, branding, etc. it seems to be working. You know, I think I think we can obviously always do a better job of it, but I think we're getting the word out and we're telling the story and we're getting better at it, and it's starting to resonate.
00:51:12:27 - 00:51:37:27
Tom Hoban: It's interesting. I think the people themselves are probably the biggest or the biggest tools for us. You know, having the homeowner testimonials because they're very specific, you know, the testimonial and the persona of the family with 2 or 3 kids that are have the kids going to school at Babcock Ranch is very different than the couple who retired and moved here from California two years ago, but they're they're equally as impactful in the marketplace.
00:51:37:27 - 00:51:44:01
Tom Hoban: So I think getting those stories out there, which we've been working on doing as well, is a very helpful tool.
00:51:44:04 - 00:52:15:22
Sam Rashkin: Yeah. Always trained to the concept that when you build a great user experience, you have an amazing new sales force in terms of your buyers. And so how do you train them to be your Salesforce? Is there anything you do to help them provide testimonials, or do you give them, for instance, their utility bills, or do you showcase the unique, resilience performance of your community versus all the others to share with their friends and neighbors, or what?
00:52:15:22 - 00:52:20:22
Sam Rashkin: Is there anything you do proactively to help them tell your story?
00:52:20:24 - 00:52:52:00
Tom Hoban: We do so. So typically if you're building somewhere, you're not typically the town, you're the developer in the town. And so, you know, when we've got every every home at Babcock is part of our Po, you know, we've got everybody's contact information. And so communications a lot easier with respect to messaging and whatnot. So we are we are in constant communication with our homeowners, educating them on nature, educating them on health and wellness, educating them on on on resiliency and how to how to properly prepare for storms.
00:52:52:02 - 00:53:11:18
Tom Hoban: You know, it's an incredibly unique dynamic. You know, there's there's no excuse if you live Babcock Ranch and have an email address, which everyone does, and or a cell phone number, which most everyone does. You know, we are in touch with everybody daily, weekly, monthly and not not in a noxious way, but more of a, you know, in our click rates are pretty high.
00:53:11:19 - 00:53:29:05
Tom Hoban: Like we have like a 75% open rate on our communication, which is like through the roof. So I think we've got a bit of a homeowner base that's really interested and curious and wants to learn and wants to know. And we host will host sessions down in Founders Square, which is what you're looking at in this picture here on the screen, which is our big public green in the lake.
00:53:29:09 - 00:53:47:18
Tom Hoban: We've got some facilities there that we host different things. So it's a it's a very daily, weekly communication that we're trying to stay in front of and keep in front of our homeowners. We have an app, you know, the app that we've got for the town also helps communication. So there's it's communication and it's a lot easier to do it when you control the town than when you're just a developer in a town.
00:53:47:20 - 00:54:08:05
Sam Rashkin: Yeah. Like I said, I think you're just training your Salesforce. When you do that, it's great. And I you must provide really good, actionable content that makes them open it up and not just not click on it. So you must do something really special there that there's information they want to have and you give them other information. They should have to know why they made such a good choice.
00:54:08:05 - 00:54:09:05
Sam Rashkin: So that's great.
00:54:09:06 - 00:54:25:05
Tom Hoban: Yeah. Got it. There's one of the benefits is that it's changing. It changes. It changes weekly literally the landscape. And so there's a lot of interest by the home. Like what's coming next like what's the next thing. So I think there's that curiosity when these emails come out we're building a new shopping center. We're building mixed use environment.
00:54:25:05 - 00:54:44:18
Tom Hoban: We're putting it in the medical facility. You know, expanding the school. And so we have about a million, plus 1,000,002ft² of commercial property that's right now under development and planning. And there's a lot of excitement around that. We can't always announce who the tenants are going to be until we get the lease signed with the tenants. So all of a sudden, we got a big news item that a new restaurant is coming in, or a new a new health care provider coming in.
00:54:44:19 - 00:54:49:29
Tom Hoban: So there is, I think, a more curious homeowner here to click on these things to figure out what's coming next.
00:54:50:02 - 00:55:17:28
Sam Rashkin: So, you know, we're getting to the end of the hour. I want to make sure I get this question in and see if you can answer it. Let's say Sydney yourself, we're given another 18,000 acres to do a whole new project and start from scratch. Is there anything you would do different and what would you do different? And because there must be some lessons learned or things you would build upon, or how would you approach it, you know?
00:55:18:00 - 00:55:31:11
Sam Rashkin: Is there anything nuanced about the next development based on all you must have learned? And I'm sure you're not like me. I like make lots of mistakes and then I learn. I'm sure you don't make any, but maybe you can share.
00:55:31:14 - 00:55:35:13
Tom Hoban: Yeah, we've had a perfect, perfect run here.
00:55:35:16 - 00:56:06:16
Tom Hoban: Now, look, I'd say first off, I think, as you know, Sam, these products are really. They're a bear, you know, and I think, you know, you don't see many people doing multiple 18,000 acre projects because it's a career. But I would say to your question, I think there are more takeaways and lessons learned. Having been through this experience at Babcock Ranch that we could apply to a 500 home community, a thousand home community at 2000 home community, that's probably more pragmatic in terms of what we would do next.
00:56:06:17 - 00:56:33:08
Tom Hoban: And I do think, you know, this idea of a having a really strong vision, you know, for what you want and where you're going or critical and having I'd say the discipline, discipline combined with flexibility because that may sound contradictory, but I think you've got to be disciplined in the vision but flexible on how you get there, because things change so quickly.
00:56:33:10 - 00:56:57:11
Tom Hoban: And I think you have to surround yourself with expertise that isn't your expertise. You can't be all, you can't be all things to all people. And I think so when I think about a Florida power light as an example, being a strategic partner, when I think about Lee Health Memorial, which is the biggest health care provider in Southwest Florida, coming in Tampa, general coming in from Tampa, you know, lumen coming in for the fiber.
00:56:57:12 - 00:57:30:06
Tom Hoban: We had Transdev come in for the for the autonomous vehicle. I think you've got to surround yourself with with with third parties that really buy into that vision and want to be a part of it, to do something of this size of scale, it's really difficult to do on your own. And I do believe that having a board of of independent thinkers who aren't biased towards your vision per se, but are there to poke holes in it and keep you on the right path, that's a really that's almost like having a conscience, you know, alongside of you to help guide you and keep you out of the trouble and help steer you towards where you
00:57:30:06 - 00:57:42:23
Tom Hoban: can be more productive. Those are all things that we learned and stumbled into along the way, Sam, that weren't always on the board initially, that I'd say have really helped, you know, the trajectory of Babcock Ranch be what it is.
00:57:42:25 - 00:58:04:19
Sam Rashkin: And speaking of doing well by doing good, do you track just how much properties have appreciated for the buyers in Babcock Ranch? Is it about the same as Florida? Do you think it's higher? Do you think you know? Do you think the market's responding to all these incredible benefits from the development?
00:58:04:21 - 00:58:25:20
Tom Hoban: Yeah, we do track it. And I'd say the the short answer is yes. It's it's it's it's been a big win for the home buyers of the committee. Babcock. And certainly the ones that came in earlier. It's been a huge win for them. But just I think just just even you know, even, you know, apples to apples across the region, I think Babcock certainly is outperforming as being a top ten community in the country.
00:58:25:23 - 00:58:45:02
Tom Hoban: You know, and we got there pretty quickly. You know, we didn't sell our first home until 2018. And so we went from not being on the top 50 list to being in the top ten pretty quickly. And I think that's kind of a certain a different way to answer your question. I think there's a lot of demand out there in there coming for the right reasons.
00:58:45:02 - 00:59:02:28
Tom Hoban: And, you know, to your point, I do think we need to really also focus on more workforce housing as well. And we are, I think, to truly be sustainable, we need to make sure that our service industry and our first responders, our teachers, our police, our firemen, the folks that really support the town can afford to live in the town.
00:59:02:29 - 00:59:25:25
Tom Hoban: You know, we don't want to be a town that has, you know, a certain demographic that has to commute 30, 40 minutes to get to the town. We want to make sure that that town can accommodate the socio demographic that we need in the town. You know? And so I do think you got to be celebrate the fact that homes are appreciating for those that have bought homes, but also keep your eye on the fact that we workforce housing for those that haven't bought into Babcock Ranch and are wanting to come into Babcock Ranch.
00:59:25:27 - 00:59:50:14
Sam Rashkin: A comment and a question. First, a comment would be I want to also recognize it a development 3035 miles inland from the coast. Appreciating is a huge thing, you know, because obviously everyone normally is trying to get as close to the water as they can. So the fact that that is happening is very significant. But the question is what?
00:59:50:17 - 01:00:00:00
Sam Rashkin: How do you do that? How do you provide workforce housing? What tools are you using to make that happen?
01:00:00:02 - 01:00:22:01
Tom Hoban: You know, right now what we're doing, we're building a we're building a 246 unit single family rental community called the flatwoods, single family homes, three, four and five bedroom homes. So we have just on our own. We've just we've just earmarked, you know, 15% of those homes to be workforce housing. And so we've gone into our school, it's a preferred employee program.
01:00:22:01 - 01:00:40:02
Tom Hoban: So if you're working our in our school system in the Charlotte County Police, Charlotte County fire, those are the preferred employers that can show up at the flatwoods and get a preferred rate on their rental for that home. So that's an example of what we're doing. We're also working with our builders to provide product on the on the on the more affordable side as well.
01:00:40:02 - 01:00:59:05
Tom Hoban: Not capital affordable but the workforce housing side. So we're we're looking at Amie Sam, and we're trying to figure out how do we create rental options and for sale. But I think there's a much easier path to get rental options available on the Army in the region and give people a home at Babcock Ranch they can afford.
01:00:59:07 - 01:01:25:05
Sam Rashkin: So what I'm going to do, Tom, respect your time or at the hour. Great feedback. I can't thank you enough and I think everyone should go visit the Babcock Ranch website. If you're down in Florida, you should go drive and see the community. When I went there, I was instantly overwhelmed with just how much special work was being done to build such a unique community.
01:01:25:05 - 01:01:32:15
Sam Rashkin: So everyone, I can't talk Tom enough and I'm going to hand it back to Mike.
01:01:32:17 - 01:01:54:27
Mike Collignon: Thank you Sam. Appreciate it much. That's going to have to conclude our webinar for today. Now for everybody who sent in questions. Don't worry. I've got all of those. And I'm going to email those over to Tom and include your email addresses. That way he can get back to you. Thank you so much for attending. Thank you, Tom, for spending some time talking with Sam.
01:01:55:00 - 01:02:22:10
Mike Collignon: Really wasn't enlightening conversation and insightful because it's such a unique situation. The scale of it is immense compared to most developments, but there are definitely lessons that can be learned even at smaller scale. So thank you very much. Thank you also to Panasonic Healthy Indoor Living Solutions and LG for their sponsorships. You know, the next Green Building Media webinar is going to take place next week on Wednesday, February 19th.
01:02:22:13 - 01:02:36:25
Mike Collignon: We're going to hear from Sarah Gutman as we explore the topic of generational marketing. That's going to start at 2 p.m. eastern time. And so next time, hey, have a happy Valentine's Day tomorrow and stay safe. Stay healthy and take care of everyone. So long.
01:02:36:26 - 01:02:40:07
Tom Hoban: Thanks, everybody. Thanks so much. Thank you so much. This is great.