Low demand pushes back Veridian construction date

By Nick Grabbe
Staff Writer

Published on November 30, 2007

When Peter Snedecor and Annie Scarff of Northfield decided to move to a condo in Amherst, they took a close look at Hampshire College's proposed "lifelong learning community."

Snedecor, a teacher, and Scarff, a hospice chaplain, are both 60 and liked many aspects of Veridian Village. It was to have green building design, open space and cultural ties to the Hampshire campus. The unit they picked out would have a view of The Notch, just as his dorm room at Amherst College did.

But they decided to buy a condo on Amity Street instead, and will move there in March.

"Price was a big part of it," said Snedecor. "We'll be a block from downtown, and our condo is beautiful, and it's there. We didn't know when Veridian Village was going to be built. We got hints they were having trouble."

Hampshire's big idea for age-targeted over-55 housing (not limited to baby boomers) seemed to have everything going for it.

Veridian Village's 129 units were supposed to appeal to the demographic bulge of people who want an active retirement, not a sterile environment.

The development was to provide a revenue stream to support Hampshire's academic mission. The college has a very low endowment, and its budget is heavily dependent on tuition.

Town Manager Larry Shaffer hailed Veridian Village as a model for increasing tax revenue (by about $750,000 a year in this case) without the expense of adding a lot of children to the schools.

And it had little opposition from neighbors or permitting problems, rare for any Amherst development.

But the planned start of construction this fall will not take place. Veridian Village needed to lock down about 20 purchase-and-sale agreements to start building its first phase, and it didn't come close.

"We're working on two or three," said Josh Cohen of Beacon Communities, the development company partnering with Hampshire.

One problem is that not many potential buyers are acquainted with this type of living option, said Pam Goodman, Beacon president. "And right now is a difficult time to be selling condos, particularly before they've been built," said Cohen.

But the main stumbling block for Veridian Village is price, according to local real estate agents and developers. The price of the condos ranges from $350 to $385 per square foot, said Cohen. Other local over-55 condo projects cost from $240 to $275.

"They probably are too pricey," said developer Scott Nielsen of Amherst.

Realtor Steve Freedman of Amherst was more blunt; "$375 a square foot is nuts," he said.

Buyers aware

Veridian Village is a little like a Prius.

The hybrid Toyota appeals to environmentally conscious buyers because of its high gas mileage and it is popular in Amherst. But it costs much more than similar nonhybrid cars, and gas would have to get very expensive to make up the difference in savings at the pump.

Perhaps Hampshire is ahead of the curve, and once the housing slump is over and baby boomers looking to downsize can sell their homes, they'll flock to Veridian Village's innovative concept. Maybe they can afford to spend $540,000 on a 1,500-square-foot condo with bamboo floors and thick insulation.

"I think the quality of the product is well worth the effort," said Larry Archey, the Hampshire official shepherding the project. "When you look at the long term and how it reflects the values of Hampshire, we are definitely heading in the right direction."

Baby boomers are increasingly looking for engagement in retirement, Goodman said. She cited a study predicting that 400 colleges and universities will create housing communities in the next 20 years.

Veridian Village, planned for 18 acres near Hampshire, pitches involvement with campus life to prospective buyers. Future residents will be able to use the library, pool and tennis courts, attend academic and cultural events and perhaps serve as mentors for students.

It offers proximity to both nature and civilization, Goodman said. Most of the inquiries have come not from baby boomers who live in the Valley but from places like New York, Boston and Connecticut, she said.

"There's no question these are higher-priced units for the area," she said. "Would we rather have the housing market where it was six years ago? Yes, we would. But I think it's a great idea, though it could take a little longer. Are we questioning the model? No."

The advent of boomers

There might be nothing wrong with the Veridian Village concept, said Freedman. Recently, one of the few real estate market niches that has seen more demand than supply is high-quality one-level homes for older empty-nesters, he said.

"But a slow real estate market isn't necessarily the time to try that out," he said. "This is not a good time to be doing anything as a builder. You have to be very careful. We don't know how long this is going on, and there are very few signs that things are getting better."

Developer Barry Roberts of Amherst said he has sold four out of five condos at a former funeral home on Amity Street, where Snedecor and Scarff are moving. Some have had price tags much higher than Veridian Village, but the price per square foot is $100 less. They are open to all age groups.

Roberts is uncertain whether baby boomers want to live just with their age peers. "Developers wonder if they want to limit their market so much," he said.

He also questions Veridian Village's location. His condos are within easy walking distance of downtown Amherst.

Nielsen, who is seeking to build a 55-and-over condo development on South East Street in Amherst, said the business model is an "ongoing experiment."

Developers aren't sure how baby boomers are going to want to live, and how many of them will keep working, he said.

"They will redefine the housing market over the next 10 to 15 years," Nielsen said. "Many people are going to want to downsize in terms of overall space, but they worked hard for 30 years and they want their housing to reflect a certain comfort level that rewards them for the work they've done over the years."