Julie Miller looked across the dug-up construction site toward the traffic on the road beyond. ”People say, `Eeeuw! Houses on Lake Cook Road?`
Not too many people have vision,” she said.
Vision is indeed a prime requisite for developers putting homes on the little pockets of property, often called infill parcels, that remain in the land-squeezed North Shore and other desirable, built-up suburban areas.
Miller, president of the Highland Park-based Kogen Group, is directing the building at Deerfield Estates, an infill subdivision of 18 homes in the $500,000-plus range, and the proximity of a main road is one of the obstacles she has had to overcome in making the little community a place people want to live in.
Infill residential developments come with a range of such obstacles, not only because the land around them is already occupied by uses that may not make ideal neighbors for new homes but also because there is usually some reason why the land was left undeveloped in the first place.
”When you talk about infill, you`re always talking about problem pieces of property, because all the easy stuff has been done first,” said Barbara Houpt, director of community development for Deerfield, where several infill projects are in progress.
Northfield-based residential construction consultant Tracy Cross calls such problems ”diseconomies,” elements that can add extra cost to a development or affect the marketability of the final product.
They can range from the proximity of office buildings, factories, shopping centers or railroad lines to the topography of the land, particularly if it is low-lying and in a flood plain.
Social and political pressures can crop up in developing infill land as well. Neighbors, accustomed to having a piece of adjacent land long vacant, feel outrage when they hear of building plans.
”You get the folks who say, `I bought my property because of the lovely trees on your property,` ” noted Houpt. ”People have said that from the beginning of time.”
They are saying it now, for instance, in Evanston, where the subdivision of two estates close to the lakefront is being opposed by a group called the Preservation League of Evanston, which claims that the properties should be left intact to maintain the character of the area.
Older, high-income suburbs such as those on the North Shore also tend to accumulate building and zoning codes and other ordinances putting restrictions on new construction. And officials of such communities may have their own decided notions of what should be built on property they are likely to be very familiar with.
Given all these constraints, infill development is not for the faint-hearted.
”If you go way out, you can build anything you want, and build it for a lesser price and make it bigger,” said Sven Flodstrom, builder of the Fountains of Deerfield, a 16.9-acre infill development of townhouses in the $275,000 to $350,000 range.
But developers go back to those liability-encumbered properties, said Cross, when they judge that the ”diseconomies” have become outweighed by the desirability of an area-a given on the North Shore-and the comparative
”diseconomies” for buyers of going somewhere else, such as a long commute, the wrong school system or the wrong neighbors.
And the developers know they are often the only-or almost the only-game in town, so they figure motiviated buyers will endure potential aggravations and still pay a premium to get in.
Cross likes to illustrate that point with the story of the woman who went to the butcher shop for pork chops and complained when told they were $4.99 a pound. ”The store down the street has them for $3.99,” says the woman. ”So go there,” says the butcher. ”But they`re all out,” says the woman.
Such a market monopoly for a wanted product gives a developer confidence to pursue the often tortuous course an infill project takes.
”At the worst, we`ll sell at cost,” said Miller. ”We don`t have any fear of building homes on the North Shore. People buying here can be assured of a very good investment and resale value.”
The Kogen Group, a fourth-generation family-operated company, has experienced the entire range of infill challenges in developing Deerfield Estates, according to Miller (her maiden name is Kogen).
To start, a portion of the property lies in a flood plain adjacent to the Middle Fork of the North Branch of the Chicago River.
To deal with that, the land plan called for setting aside one-third of the 15-acre project as a nature preserve and detention area, with an overflow ditch cut alongside the waterway. Getting the necessary federal, state and local approvals took about 10 months.
”When you talk about a developer spending an extra year goofing around to get these approvals, that adds a lot of money and time,” pointed out Deerfield`s Houpt, who has been in her job 16 years and followed the Kogen project closely.
Then there was the changing nature of the area. Twenty years ago, when much of the surrounding residential development was built, Lake-Cook was a sleepy two-lane road. Now it teems with office and retail development, including Northbrook Court a few hundred yards from Deerfield Estates.
The village in fact had briefly thought about encouraging commercial development on the land, but discarded that idea. Multifamily development proposed by other developers also was turned down.
With a comparatively low-density project, Kogen had little trouble getting zoning approvals, Miller said. But the village didn`t want to exacerbate traffic problems by cutting another road off Lake-Cook, so the permanent Deerfield Estates entrance can be reached only by winding through an older subdivision.
At the same time, the land plan had to protect the lots nearest Lake-Cook Road from traffic annoyance. The Kogen Group wanted a berm, but the village insisted on a fence, and got its way, Miller said. The fence and a 50-foot buffer zone will insulate homeowners from the road, she added.
The worst problem, said Miller, was a homeowners association from an adjacent subdivision that had been there for 15 years. ”They fought tooth and nail against us,” said Miller.
Association members appearing at town meetings brought up issues of flood, traffic and density, and even opposed the name Deerfield Estates.
But Miller said change lay at the heart of the matter. ”People felt violated that an area that had always been left open was changing,” she said. ”It forced us to sit down and listen to them and tell them that we understood.”
All these issues have to be resolved in a way that make the numbers work for the developer, Miller added. Costs can`t be allowed to rise so that the houses are priced out of the market, and that can be a delicate balancing act in prestige areas where land prices are stratospheric.
”Getting land at the right price is important,” she said. ”People will call and say, `I have the last parcel in Highland Park and I`ll sell you a half-acre for $300,000.` That doesn`t fit in with our philosophy.”
The Kogens ended up paying about $1.8 million for the land with improvements, or about $100,000 per lot, which left them sufficient margin to make a profit on $500,000-plus houses.
They`ve sold eight homes, mostly to doctors, since they began building last fall and expect to finish the project in another 18 months. Since they started trying to buy the property in 1988, that will make the whole project a process of four or five years, a long haul for 18 houses.
Sven Flodstrom`s Deerfield project, the Fountains, illustrates a key maxim of infill development cited by Cross: The talents of land planners can mitigate the disadvantages of a problem site.
Flodstrom made a trade with the Village of Deerfield to get a 16.9-acre parcel on Pfingsten Road north of Lake-Cook. The property was next to a tract previously held by Flodstrom that had once been used for a sanitary landfill. Nearby were commercial buildings, railroad tracks and the Sara Lee bakery (now vacant).
The land was zoned for multifamily units, and Flodstrom`s key challenge was to create a plan that would both satisfy a village unaccustomed to multifamily development and create an attractive environment in less-than-ideal surroundings.
His plan, conceived on a trip to his native Sweden, was to turn his development inward, centering it on an island in the middle of a lake. With that plan, the vast majority of his homes are either on the island or around the perimeter of the lake.
To provide privacy for his unusual lakeside settlement, he constructed a high berm to the east blocking out sights and sounds from the railroad and factory. To his good fortune, the village built a park on the landfill tract, which acted as a further buffer.
The lake plan helped sell the development to the village, which had rejected some of Flodstrom`s previous ideas, said Houpt. And it also has attracted buyers, with 42 of the 73 pricey units purchased since sales opened two years ago.
The creation of a special environment was also a primary goal at the Cotswolds, a development by the Northbrook-based Perlman Group of 45 single-family homes and 58 townhomes on Dundee Road in Northbrook.
”One of the big things about infill is that it`s got to be self-contained,” said James Perlman, the firm`s director of development. ”It`s got to be focused inward so it doesn`t focus on other uses.”
The developer had to meet another challenge as well on the 37 acres purchased from Underwriters Laboratories, whose plant lies just to the north. The land was in a flood plain, and complex adjustments for water retention and flow had to be worked out.
The two problems were solved-over the course of 16 months of negotiations with federal and state agencies dealing with flood control-through the creation of a series of lakes.
The water features, cluster-style groupings and an English Country architectural style were combined in an attempt to fashion a landscape reminiscent of the quaint Cotswolds area of England.
But the project also illustrates one of the potential pitfalls of infill development. Getting the needed permits for the flood plain changes took so long that the development wasn`t able to open until after the market began to soften, Perlman said.
The property was purchased in late 1987, but selling couldn`t begin until the spring of 1990, he said. ”It was a very, very hot market when we got in,” he said. ”But you learn, the hotter the market, the quicker it dissipates.”
He estimated that had he been able to start selling six months earlier, he would have been able to sell 40 more of the units, priced at $485,000 to $543,000 for the single-family homes and $329,000 to $363,000 for the townhomes, than he has. About 30 of the units have been sold so far.
One of the biggest infill projects to hit the North Shore in a long time is Glenlake Estates, a joint venture between Illinois Tool Works (ITW) and the Northbrook-based James Companies for 106 single-family homes and 66 townhomes on 56 acres off Pfingsten Road in Glenview.
In fact, Mary Bak, director of development for Glenview, which annexed the land during the development process, asserts that it`s too big to be called infill.
Still, the development has to cope with many of the classic infill challenges. It`s on an arterial road, next to a factory, near a railroad line, across the street from a high school and a hospital and adjacent to concerned homeowners, all of which are factors that impose constraints.
The biggest challenge, according to Jerry James, president of James Building Corp., were the nearby homeowners. ”You can`t go into an established community like Glenview and present a plan devoid of consideration to the neighbors and their concerns,” he said.
The neighbors` main concern was density, so the developers reduced the number of townhomes from a planned 89 to 66. They also distributed a booklet that discussed issues such as impact on town services and schools, and invited the neighbors to the town`s preliminary hearing on the project.
The land plan deals with the proximity of Signode Corp., which makes packaging systems, by siting the townhomes and landscape buffers along the edge of the factory property. Similar buffers are used along the rail line and Pfingsten Road.
The developers had planned to put a retail strip along Pfingsten across from the high school, but Glenview officials said that would present an attractive nuisance for the students, so that idea was dropped.
To handle traffic both for the subdivision and the hospital complex across Pfingsten, the developers agreed to help pay for new traffic signals.
For buyers, the proximity of land uses that might be perceived as negative, said James, should be ”far outweighed by the opportunity to buy into the North Shore with new construction at a price which, all things considered, is reasonable and affordable.”
Pre-construction prices start at $239,000 for townhomes and $359,000 for single-family homes.
If the North Shore`s marketability continues as it has, infill development is likely to continue on even the most unlikely and challenging parcels.
As development consultant Cross quipped, ”Just when I say there`s no land left on the North Shore, God makes some more.”
What he really means is that the market-and developers` determination to tap into it-makes some more.
