When developer Clint Jones acquired the land for the Lakes Edge development outside of Austin, Texas, he knew it was a winner. The 48-acre parcel was in the school district for Westlake High School, consistently rated as one of the best high schools in the state, and because the landlocked district is almost completely built out, it was the first large development in the district in decades.
So it comes as little surprise that sales in the development have been stellar since builders Ashton Woods and Trendmaker Homes purchased the 118 home sites in 2017. Ashton Woods, which began sales at the community first, had sold all but three of its lots there as of February, according to data from housing market data provider Zonda, and ranks second in sales rate among the 10 closest nearby communities. And the homes from both Ashton Woods and Trendmaker have the highest sales price among those 10 communities, with an average price ranging from $730,000 to $750,000, depending on the lot size and builder.
And while the fantastic school district played a role in the community’s success, another factor was the upfront planning Jones did to ensure that, although the area has no access to natural gas, the builders had a gas option through a community propane system.
“You know that in a higher-end community, the demand is going to be that you provide not only electricity but you do provide gas,” says Jones, president of Regal Land Development, based in New Braunfels, Texas. “A lot of these [homebuyers], with the wealth that they have, a lot of them are putting in swimming pools, hot tubs, things of that nature. Gas is a great alternative to electricity for a lot of people for different appliances but especially a community like that, where they’re having swimming pools that they want heated and where they need propane gas for their outdoor kitchens and everything like that.”
7 planning tips
Jones has become adept at planning for community propane systems after working with Harris Baker, president of Austin-based HBH Gas Systems, to design a community propane system. After the success of the first project, he’s been using centralized propane systems ever since. “The benefit is, I don’t have to think much about the gas,” he says. “That’s not a deciding factor, whether there’s gas in the location. The propane company can come in and make it all happen.” (The Build With Propane newsletter previously profiled the Reserve at Lake Travis, a high-end resort community Jones developed with a community propane system.) He offers these tips for planning for a successful and profitable development.
1. Be prepared for the gas question.
When Jones approaches builders to offer available lots, they typically have a checklist of questions: How’s the water? How’s the waste water? What about cable?
“One of the inevitable questions they’ll have is, ‘Are you going to have gas?’” Jones says. “Down here, because of the prevalence of gas availability in all of these communities, they actually are expecting gas in their community.” Not being able to offer a gas option, either through natural gas or propane, would leave a developer in a predicament.
2. Decide between individual tanks and a community system.
In larger-lot developments — those with an acre or more of land — developers may not need a centralized propane system because builders can bury a propane tank on the lot for each individual homeowner.
“When you’ve got the smaller lots and you’re trying to squeeze the home on there and all the other stuff that goes in there, a lot of times there’s not the space in there that you would need to throw in a propane tank,” Jones says. “We go to the centralized propane system because generally you can put it in one particular location. It takes up a small amount of space.”
3. Choose a propane storage site strategically.
Jones likes to choose an area for the propane storage tanks where the propane provider can refill them with little disruption to the community. At Lakes Edge, he built a small parking area outside of the community’s entry gate where the propane company can easily pull in and fill up the tanks without driving through the community.
4. Bring your trades together as early as possible.
At the outset of the project, Jones brought every trade together in his civil engineer’s office to discuss the development’s overall plans and create real coordination between the different contractors. In many cases, the gas lines can go in the same trench as the electricity. Getting specs and plans from your electric company and propane provider upfront allows the engineer to incorporate those services in the main overall plan set.
“That way,” Jones says, “the general contractor, when he’s out there with his dry-utility contractor — who is putting in the electric, the gas, all of that — he knows where it goes.”
5. The propane provider may pay for the gas infrastructure.
In exchange for the right to serve as the exclusive propane provider of Lakes Edge for a set period of time, Pinnacle Propane provides all of the community’s propane infrastructure at its own cost. The agreement protects homeowners by stipulating that the propane provider can’t charge above-market rates.
While Jones prefers that arrangement because of his good relationship (and good past experiences) with his propane provider, developers also have the option to pay for their own propane infrastructure. “You basically contract for someone to come out and fill the tanks,” Jones says. “That gives you the flexibility that if you’re disappointed in one company, you can go to another company.”
6. Involve your builders in the propane agreement.
As part of the agreement with the propane provider, the builders in Lakes Edge charge a connection fee to their homeowners and agree to install a minimum number of propane appliances.
“The builders are very much in the conversation when I’m having that dialogue,” Jones says. “But the builders I’ve found see it as a positive because of some of the options and upgrades, like the outdoor kitchens. They really want it in there because that’s a selling point for them.” Propane water heaters, fireplaces, and cooktops are popular, Jones says, but every builder and buyer is different, so it’s nice to offer flexibility around which systems are installed, if possible.
7. Know that working with propane is likely to be a smooth experience for the builder.
Since Jones’ builder clients come into new developments expecting gas, they don’t have to make big changes to their sales or construction practices to accommodate propane. “Their models, all of their spec homes — it would be a bigger change if they didn’t have any gas,” Jones says. If builders have any remaining concerns, he’ll point to his prior history with propane developments, noting that propane hasn’t created any problems in his 10 years of experience working on such projects.
With no more large tracts of land in Westlake High School’s district, it’s likely that Lakes Edge will be the last development of its kind in the neighborhood. But if Jones’ record is any indication, it won’t be the last he develops with gas provided through a propane community system.