Dolan Media Newswire Story
Subject: St. Charles County-based Miljonaire Development focuses business on ultra-luxury market
Pub: St. Charles County Business Record
Author: Sarah Wienke
Issue Date: 10/04/2008
Miljonair Development focuses business on ultra-luxury market
by Sarah Wienke
Dolan Media Newswires
ST. LOUIS, MO -- A St. Charles County-based developer and homebuilder has plans to capitalize on the one market he says has been unscathed by the economic downturn: ultra-luxury homes.
Mark Moebius, CEO of Miljonair Development, held an exclusive outdoor event last weekend to debut its seven private lots at its development at St. Albans Legacy Pointe. The site is on the Missouri River bluffs, adjacent to the 144-acre Engelmann Woods Nature Preserve.
Moebius said the custom-built luxury homes will range in value from $1 million to $5 million. He plans to have an 11,000-square-foot display home ready to show in August.
Miljonaire, with offices at the Economic Development Center of St. Charles County and St. Alban, started its development business in 2004. Just this year, Moebius started Miljonaire Homes (slogan: “Build for the way you live.”) in order to go after the ultra-luxury market.
Moebius cites a September article on Forbes.com that indicates prices in the high-end housing market – the 2 percent of homes in the U.S. that sell for over $1 million – have largely remained insulated from the nationwide downturn.
Other recent reports on the state of the housing market don’t paint as sunny a picture, however. Nationwide, luxury homebuilders are struggling. Last month, Toll Brothers Inc., the largest U.S. luxury homebuilder, reported its fourth straight quarterly loss.
According to the U.S. Commerce Department, sales of new homes fell 11.5 percent last month to a 17-year low and the median price dropped to a four-year low.
Moebius said that he’s been more concerned about the housing downturn over the past month, but remains positive.
“It’s not like the people who are buying these homes don’t have the money, but people are pausing to see what happens,” he said. “Right now it seems like someone will pull the rug out from underneath you, and it’s taking people away from dreaming about that new dream home.”
Moebius, who is not by the way the Templeton Emerging Funds’ Mark Moebius, had a 17-year career in marketing before starting Miljonaire, the custom homebuilding and development business. Moebius plans to use the recent decline of several big-name homebuilders as an opportunity to introduce itself to realtors and prospective clients as a custom homebuilder.
Moebius explained that the homebuilders he was selling his lots to were doing well in the million dollars and up market, so he decided to give it a chance.
“Million and up is doing quite well and isn’t as affected as much by what we’re seeing in other markets,” he said.
The difference between an ultra luxury home and other homes is the finish work, such as natural stone and custom woodwork, the design and the luxury items within the home, Moebius said. “It’s amazing how the extra elements add to the value of the home. It attracts me as a builder to deliver that.”
Moebius said his company will take luxury to a new level by providing his clients with three months of free personal concierge service with the purchase of a custom home. The service includes a personal assistant to help the homeowner unpack, organize, run errands, walk the dog or set appointments.
Moebius said he’s looking at rural St. Charles County for future property to develop. “We’re always in search of the right piece of property,” he said.
Friday, October 31, 2008
'Ultraluxury’ home sales healthy despite hesitancy'
St. Louis Business Journal - by Cynthia Vespereny
A 6,000-bottle wine cellar. A heated driveway. His and her garages. A basement designed as an indoor tennis court.
These and a host of other stunning features are available in homes in St. Louis’ ultraluxury market, or those priced at $3 million or more. And while buyers are taking extra care amid turmoil in the financial markets, sales do not seem to have been hurt by the sinking economy, industry sources say.
“We would describe it as the buyers are cautious, but there’s definitely activity,” said Coldwell Banker Gundaker agent John Ryan. He and his mother, Anne Ryan, work together and have 10 ultraluxury listings on the market, ranging from $3.05 million to $9.7 million. “We have appointments with qualified buyers on all of those properties,” he said.
While sales in other segments of the housing market have been decimated, the ultraluxury market has held its own. In fact, homes priced at $3 million or more have been selling faster this year than in the previous two, according to data from the St. Louis Association of Realtors.
The average number of days on the market for such homes this year is 146, down from 224 in 2007 and 265 in 2006, said Matt Newport, an association spokesman.
The median price of ultraluxury sales this year is nearly $3.33 million, down from $3.5 million in 2007 but up from $3.2 million in 2006.
Buyers in the ultraluxury market are “much more resistant to the vagaries of the economy,” explained Laurie Moore-Moore, founder and CEO of the Dallas-based Institute for Luxury Home Marketing, which helps real estate professionals maximize their success in the upper-tier residential market.
“At this level it’s not just a lifestyle purchase — it’s a portfolio play,” she said, adding that one in three buyers of homes priced at $1 million or more pay cash. “These folks are citizens of the world. Most of them are going to have multiple homes.”
Who is in this elite class locally? Mostly top execs, athletes and entertainers, Anne Ryan said.
The most expensive home on the market now is in Ladue and has a $14.5 million price tag. Set on nearly 11 acres, the chateau-style residence comes with a 6,000-bottle wine cellar, eight fireplaces, a lake, gardens, fountains and pool. It is owned by Don Bryant, who heads the Bryant Group, a wealth management and executive benefits planning firm he founded.
“It’s acres of serenity. You feel like you’re at Brigadoon,” said listing agent Jen Ross of Laura McCarthy Real Estate, noting that Ladue is “somewhat saturated” now with listings in the $1 million to $3 million range.
Yet while Moore-Moore said the ultraluxury market has remained healthy nationally, she warned that the crisis in the financial markets has spawned some hesitancy. “What I’m hearing anecdotally is that people are still looking but they’re not necessarily signing on the dotted line,” she said.
That doesn’t faze The Plaza In Clayton, which just hiked prices of its remaining luxury condos. Its two top-priced units are now $3.37 million, up 9 percent. The 82-unit highrise, developed by THF Realty, has four condos available for more than $3 million, and the price increase reflects not only upgrades in appliances, custom millwork and other interior finishes, but market demand, said Sarah Bakewell, president of Edward L. Bakewell, which lists the property.
“There’s nothing in St. Louis that compares to it,” Bakewell said. “People who can afford things at this price point are savvy about their money. They’re going to spend their money if they see the value.”
The most expensive condos, at 5,600 square feet, offer four balconies, three fireplaces and maid’s quarters, along with concierge and valet service. The units sometimes serve as a living quarters for out-of-towners, Bakewell said.
Also betting big on the ultraluxury market is Mark Moebius, CEO of Miljonair Homes, who is planning two developments in St. Albans. Twenty-two-acre St. Albans Legacy Pointe and 24-acre St. Albans East will feature homes with average price tags around $3 million and as high as $5 million.
He’s currently building a showcase home that will boast an attached guest house, a six-car garage, a cutting-edge media room, outdoor kitchen and a pool with a 10-foot waterfall. Moebius, whose company’s name is Dutch for “millionaire,” also is throwing in three months of complimentary concierge service so new home buyers won’t be bothered with doing the laundry or walking the dog.
“This market has really not stopped at all,” said Moebius, who has a couple of contracts so far. “If you’re the type of person who wants to buy a Lamborghini, you pretty much have the money for a Lamborghini.”
Jim Minton of Minton Development, whose homes average upward of $4 million, said he expects his revenue to be up 30 percent this year. “Right now, knock on wood, we’re as busy as we’ve ever been,” he said.
Minton attributes his increase in revenue to the fact that buyers aren’t as sensitive to the economy as others and the long lead time in building the homes. Much of his current business was actually landed a year or more ago. The big question is, “What will things be like a year from now?” he said.
But back to that heated driveway. It comes with a house in Town and County on the market for $6.9 million. The 15,000-square-foot palace also has a heated four-car garage, eight bedrooms, 12 bathrooms, four kitchens, seven fireplaces, three laundry rooms and an elevator.
Can’t stand sharing? At least two homes in the ultraluxury market offer his and her two-car garages, one in Richmond Heights for $3 million and another in Frontenac for $3.8 million. And an 8,700-square-foot mansion in Ladue listed for $3.3 million features a voluminous basement originally designed as an indoor tennis court.
Cynthia Vespereny is a St. Louis freelance writer.
Luxury home builders invent new tactics to draw buyers
With tough market, high-end builders add services
By Eric Becker
Tuesday, October 14, 2008 3:16 AM CDT
You may think you know everything about the home market, but there's a good chance the luxury home market could throw you a curve ball. That's because home builders and real estate professionals that sell in that market say it reacts quite differently to tough economic times.
"When you're selling regular track homes, you go into a subdivision and there may be 400 homes and six home plans. That's not how it is with a luxury home. It's going to be totally custom," said Karen Browne of Re/Max Discover in St. Charles.
Browne's real estate sales portfolio is comprised mostly of homes priced from $800,000 and up into the millions.
The average customer for one of these homes in St. Charles County tends to fit a neat stereotype: relocations from the East and West coasts, executives who come from areas where a cool million isn't a whole lot of money.
Browne estimates luxury home sales account for 2 percent of home sales in the county.
But when the market slows down, whatever is a luxury home builder to do?
Browne said luxury home builders are getting creative.
"You're seeing decorator's services, lawn services, all sorts of niceties that a $300,000 homebuyer doesn't even think about," Browne said.
Mark Moebius, who owns Miljonair Development in St. Albans, is offering three-month concierge service for those who will buy in his St. Albans Legacy Pointe development, which will feature homes into the $5 million range sitting on 21-acre lots.
"It's the perfect thing to offer right now to our customers," Moebius said, because it could give otherwise sluggish buyers an incentive to seal the deal.
He said the concierge service is designed to take the hassle of setting up phone and cable services, buying back-to-school supplies and doing other chores off the hands of buyers.
Because luxury homebuyers have more discretionary income, it's taken longer for the housing slowdown to hit those builders in the area.
The Home Builders Association of St. Louis and Eastern Missouri said it does not track the luxury home market very closely, and so could not say with confidence what sales figures for luxury homes look like now compared to years past.
Browne said recent economic turmoil probably has slowed the luxury market.
"I think the market today has an impact on luxury homes in that many of the people who are going to buy a million-dollar home or above are heavily invested in the market," she said. "I would say the last two to three weeks, I would say the brakes are on."
Intriguingly, Browne said every house she had for sale in the regular track market below $450,000 has been snatched up.
Moebius' luxury home community he's building in St. Albans has homes starting at $1 million. He's currently building an 11,000-square-foot display model that sits on 21 acres at the St. Albans East development, which he plans to market at $5.5 million.
Previously, Miljonair simply marketed lots to custom home builders. But with some clients no longer buying lots, Moebius said he decided to give the million-plus homebuying market a try.
"The million-plus homebuying market has changed a whole lot until just recently with the financial situation," he said. "The toughest thing now is that it's taking buyers a year or so to make the decision about whether to buy or not."
Moebius said St. Charles County home builders have been teetering on the edge, and the failure of builders such as Taylor Morley Homes has caught other builders off guard.
Moebius is betting the quality of his product at St. Albans will still attract corporate executives even with the economic situation. He cites another builder who built a $15 million house for his friend as a positive sign.
The Wall Street Journal recently reported the outlook for prime property over the medium and long term is strong, though demand is likely to slow for the remainder of this year and into next. A report on the Luxury Home Council's Web site shows the nation's largest luxury builder, Toll Brothers, slowed its building activity after 28 percent of its customers canceled their contracts in the last quarter of 2007.
For now, Moebius said he needs people to continue dreaming about their ideal home, something the harsh economy could crush. With banks tightening lending, Moebius thinks luxury home builders could have difficulty finding the financing to build display homes. Moebius plans to build two or three more homes next year, and hopes the year after that the market will improve enough for him to construct eight or more properties. For now, he said he still receives two calls a week from relocation companies looking for home builders to accommodate executives. He says the slower pace in the last few weeks is a pause, not a permanent slowdown.
Browne, for her part, says it's taking longer to sell her high-end homes, but sales are 10 percent higher this year over last.