September 25, 2024 by John Krukowski

‘We Build Relationships’: How 2 Texas Developers Built Their Transformative MPCs

Photo: Courtesy of Viridian/The Nehemiah Co.

Master-planned communities — custom-built residential communities with mixed-use elements — tend to be big, often encompassing thousands of acres of housing and amenities. And Texans are embracing them in a big way.

A recent ranking of the 50 top-selling MPCs in the country was dominated by the Lone Star State, which was home to nearly 40% of the communities on the list. Greater Houston alone had 13 MPCs in the top 50, the most of any metropolitan area in the United States.

MPCs can boast many advantages for homebuyers and their communities, including access to highly desirable amenities and a range of housing types. They also tend to outperform new single-family home sales nationwide, according to RCLCO Real Estate Consulting, which compiled the top 50 list. But developers can also face challenges when creating new ones, ranging from responding to local pushback to simply trying to make the projects pencil in today’s high-interest-rate environment.

Bisnow spoke to developers of two Texas MPCs to learn how they have overcome obstacles to build successful neighborhoods on previously underutilized land, including by reaching out to other stakeholders and utilizing special districts.

“We build relationships with all the jurisdictions in the communities where we buy land,” said Rob Bamford, general manager of Cross Creek Ranch near Houston. “We want to help them understand our value propositions, honorable intentions and expectations.”

Photo: Courtesy of Viridian/The Nehemiah Co.

From Desolate To Desirable: What It Took To Bring Arlington’s Viridian To Life

 

Viridian, a 2,200-acre master-planned community in Arlington purchased by Johnson Development in 2015, has brought nearly 4,000 homes to a formerly neglected area a short drive from DFW International Airport. In the process, a zone once known for its landfills and now-closed strip clubs has been transformed into the third-wealthiest ZIP code in North Texas.

Achieving this metamorphosis required more than bricks, mortar and pavement, said Robert Kembel, owner of The Nehemiah Co. and general manager of the Viridian development team for Johnson Development. It also called for a clear vision of the highest and best use of the land as well as an understanding of what it takes to bring a complex master plan to life.

“Infrastructure allows development to happen, but it doesn't necessarily create great environments, and then there's infrastructure that creates great environments that people value and want, but it's too expensive to build,” he said. “So the question is, how do you merge public and private financing with public infrastructure to achieve a sustainable community?”

A Principled Approach

The answer, Kembel said, is summarized in a set of principles The Nehemiah Co. has come to follow since he joined it in 2012. Influenced by the ideals of the Congress for New Urbanism, a nonprofit advocating for thoughtfully designed neighborhoods that foster community, The Nehemiah Co. regards the local municipality as the “master developer.” 

Kembel said The Nehemiah Co.’s role is to bring an MPC to life for a town or county in a way that benefits the surrounding community as a whole and creates a desirable neighborhood that will stand the test of time.

“Our city councils and our county jurisdictions — their primary job is to create great environments for their citizenry,” he said. “We work closely with them and other stakeholders to achieve that.”

Other guiding principles for the company include an emphasis on creating economic diversity with a mix of housing products in its developments. In Viridian, the housing stock includes single-family houses and townhomes, as well as homes designed for active older adults and multifamily housing. Recently, 109 homesites in the development’s Lakeside community went on the market, representing a variety of housing products, with floor plans ranging from 1,797 SF to 3,158 SF.

Photo: Courtesy of Viridian/The Nehemiah Co.

The company also seeks to work in partnership with local taxing authorities to increase property values in and out of the MPC. Land value in the Viridian community has increased more than 200 times since the development partnerships began acquiring land there nearly 20 years ago. It is projected to reach nearly $1.9B in 2025, Kembel said.

Lastly, The Nehemiah Co. pays attention to quality and details in areas such as architectural design and landscaping. In Viridian, this takes the form of carefully designed streetscapes, lifestyle programming and shared amenities that include multiple swimming pools, more than 1,000 acres of lakes, open space and green space, and a variety of park types, such as mews parks that connect Viridian’s neighborhoods. 

Kembel, who calls himself “a fan of density,” admitted that density only works if well-considered urban design and amenities are part of the plan.

“People need parks and they need street trees and they need trails and some level of amenities,” he said. “I don't think it’s unreasonable to ask developers to include those in exchange for the use of public-private tools like special districts.”

Maximizing Stakeholder Value

Kembel said living up to his company’s ideals requires an understanding that an MPC serves multiple stakeholders. They include homeowners, financial partners, neighboring landowners, various government entities and two local school districts, in the case of Viridian. 

“Some developers are mostly motivated to maximize shareholder value, as opposed to trying to maximize stakeholder value, which includes shareholders,” he said. “In this way, we actually get superior returns for our master plans over time, but this emphasis on quality means it takes longer to build the MPC’s brand.”

Viridian’s sales success and rising property values prove that his company’s approach is worth the effort, Kembel said. The result is an MPC that transformed a formerly neglected area into a place to live and raise a family.

To Kembel, it is also a place of healing. 

Five years ago, his wife, Keri, suffered a massive brain aneurysm that put her in intensive care for months, he said. It has been a slow process of healing, but Kembel credits Keri’s improving health partly to the nature-based amenities of Viridian, where she gradually became more physically active while doing activities such as riding a recumbent bicycle on the development’s extensive trail system. 

He said this raises a question: Why can't all our communities be places of healing?

“Too often, we wind up with communities that are focused only on shareholder value instead of on placemaking,” Kembel said. “But if you want placemaking, you and all the stakeholders have to participate. The message here for all of us, both public stakeholders and private developers, is that we get one opportunity to build a great community, and they're too expensive to fix if you mess it up.”

Photo: Courtesy of Cross Creek Ranch/Johnson Development

A Creek Runs Through It: How A Houston-Area MPC Created A Home For People And Nature

Cross Creek Ranch has completely transformed a 3,200-acre site west of Houston.

The master-planned community, which sold its last remaining lots earlier this year, has brought thousands of homes to the city of Fulshear, Texas. Its options include single-family homes, patio homes, townhomes, and age-restricted and multifamily residences. 

Since work on it began 20 years ago, Cross Creek Ranch has made homeownership a reality for more than 6,000 families, and its rising property values continue to contribute revenues to local school districts, Fort Bend County and the city of Fulshear.

“We aspire to make the American dream of owning a home a reality for our buying public,” said Rob Bamford, general manager of Cross Creek Ranch for Johnson Development, which was recently named Houston's developer of the year.

Landscaped open space today accounts for more than 20% of the development’s total acreage, making hundreds of acres of green space available for recreational activities by residents. The CCR Community Association employs an on-site lifestyle director for residents, with more than 75 events every year, Bamford added.

Twelve years ago, Johnson Development founder Larry D. Johnson bought Cross Creek Ranch from Trendmaker Homes, which is now Tri Pointe Homes.

“Mr. Johnson wanted to keep the initial vision alive, and that's what we have done,” Bamford said. “We have a unique landscaping palette that includes reforestation, native grasses, savannas and an incredible mix of natural amenities that, over the years, have flourished into an indigenous environment that looks very natural.”

Treated, nonpotable water from the MPC’s wastewater treatment plant is used to irrigate 98% of the development’s natural features. Bamford called this a “significant sustainability component” that avoids depleting precious groundwater resources.

Cross Creek Ranch today features more than 100,000 trees planted by Johnson Development, 45 miles of hiking and biking trails, and 500 acres of lakes. Other amenities include a fitness center for residents, pocket parks and playgrounds, sports fields, disc golf, pickleball and tennis courts, a dog park, four pools and a water park with a 140-foot-long slide. The development is punctuated by an 80-foot-tall observation tower that offers vistas of more than 30 miles.

Recent mobility improvements such as the Westpark Toll Road extension and the Texas Heritage Parkway have made the community convenient to employment centers, hospitals and commercial areas, Bamford said. 

An Emphasis On Collaboration

Cross Creek Ranch’s name was inspired by Flewellen Creek, which Bamford called the natural centerpiece of the development as it meanders for more than 2 miles through the property. The MPC is also split by the Lamar and Katy school districts, which operate schools at all grade levels in or near Cross Creek Ranch. 

“The great schools in both districts are important to our builders and have become a powerful magnet for the community,” he said.

Photo: Courtesy of Cross Creek Ranch/Johnson Development

Bamford said the MPC works closely with the districts to ensure the schools can keep pace with the growth of Cross Creek Ranch, which anticipates even more families moving in as its last lots are built out and sold to new residents.

“It’s a real collaborative effort between our local planners and the school districts’ demographers to coordinate the timing of new resources at the elementary, junior high and high school levels,” he said. “It’s a credit to the school districts for managing their resources as our population grows.”

Bamford said the five municipal utility districts serving Cross Creek Ranch have a combined assessed value exceeding $3.6B, benefiting both Fulshear, recently named the nation’s second-fastest-growing city, and Fort Bend County, which neighbors Houston. 

“Multiple administrations of the county and Fulshear have been very good to work with, even as they and we have grown exponentially,” he said. “Fulshear actually moved their city hall into Cross Creek Ranch, which we took as a great compliment, and we’re glad to have their police and fire departments on-site as our first responders.”

‘Crowning Achievement’

Cross Creek Ranch might be nearly built out, but it is still earning accolades. 

RCLCO Real Estate Consulting recently listed the development as a top 50 best-selling MPC in the nation. Cross Creek Ranch notched 222 home sales in the first six months of 2024, a 7% increase from a year earlier.

“It is quite the achievement for us, as we have built ourselves out of several of our building products with no more land available,” Bamford said. “We’re down to five variations right now, but at one time, we had nine different opportunities for buyers to consider. We also had a record sale of $1.7M for one of the homes this year, which was another great crowning achievement for us.”

Johnson Development has approximately 20 other projects under development, most of them in Texas. Bamford said the company approaches them the same as it has Cross Creek Ranch, with an emphasis on working collaboratively with stakeholders and providing the best amenities possible for residents.

“Land is trading at an all-time high in our market, and that influences how deals pencil out at the end of the day,” he said. “The Houston market is trending in a very positive direction, and Johnson Development is proud to call Houston home.”

Watch for a final article in this series that will look ahead to the future, including the 2025 Texas legislative session.

In-depth coverage on the issue of Texas housing affordability is brought to you by ABHR and Studio B. Bisnow news staff was not involved in the production of this content.

Studio B is Bisnow’s in-house content and design studio. To learn more about how Studio B can help your team, reach out to studio@bisnow.com.