Brewer Creek lot prices approved
Prices range from $15,995 to $69,995
Lots in Webster City’s Brewer Creek Estates Additions 5 and 6 are ready for sale. Prices for the newly developed lots were finalized and approved at Monday evening’s city council meeting.
Lots will be sold on a first-come, first-served basis. Lots range in price from $15,995 to $69,995. The City hopes the diverse price range will encourage and give individuals at different economic levels more opportunity to buy a lot to suit their needs.
“We’re really looking at trying to have a variety of options available for people interested in building a home in Webster City,” said City Manager Daniel Ortiz-Hernandez. “We wanted to accommodate size for every type of family looking to build.”
Lot prices were determined through projection models, input from city financial advisors and local realtors.
“As we were moving forward and most of the cost and the project had been completed, then we started looking at what the pricing of lots would be,” said Ortiz-Hernandez. “We’ve had some costs that weren’t factored in at the beginning that were absorbed into the project, such as the trail head, and now we’re having to account for things like mailboxes and changes to the original plan.”
The project, estimated to cost nearly $2.6 million, was originally funded through a loan from the electric utility. Tax Increment Financing repays back a portion of the loan, where one portion is paid through the lot sales and the other portion will come in time through TIF to pay that back.
“Without resources like TIF, most residential, even some commercial and industrial development, would not occur in the state,” said Ortiz-Hernandez. “It’s a widely-utilized tool in the state for development projects.”
If lots take longer to sell than anticipated, the city may look at adjusting the cost of each lot.
“There is still some opportunity if things don’t sell quickly, the council has the flexibility down the road to adjust the prices based on what we’re seeing,” said Ortiz-Hernandez. “But we’re close to that level in terms of what we can expect to recover from Tax Increment Financing.
Lot prices were determined by a number of factors:
• The amount of TIF the city could recoup off of each lot
• The size, shape and location of each lot
• Advice and information received from local realtors
“In determining the lot prices we worked with our financial advisor to develop a couple of models of what the lot prices would be if we wanted to not use TIF but actually have the lot pay for themselves up front, rather than TIF,” said Ortiz-Hernandez. “So our financial advisor developed two models to account the cost of the lot on total square footage and the cost of each lot on linear square footage to give us two perspectives to look at in terms of pricing.”
As there are many uniquely-shaped and sized lots within the newest subdivision, officials wanted to ensure each lot was fairly priced according to square footage factors.
“The reason why that was done was because of some of the sizes for the lots. You’ve got some really big ones that had a slimmer curb. Then you had some really big lots that had a wide area but also possibly had smaller curb than some of the other lots that would be smaller in square footage but have a wider curb side,” said Ortiz-Hernandez.
Once square footage was taken was taken into consideration, officials incorporated potential TIF earnings to be recouped from each lot. TIF will be recouped on each sold lot for 11 years.
“Once we got a desired number, taking those two models into account, then we started factoring in Tax Increment Financing and looking and what we could reasonably expect to recover from Tax Increment Financing,” said Ortiz-Hernandez. “That allowed us to bring down those numbers on lot prices.”
“So if a lot, after the initial two models, said that a lot would be valued at potentially $50,000. Then once we started factoring in what we can recoup from TIF, that would bring that lot price down to say ballpark $35,000 roughly.”
“All of these lots prices ultimately started high and were reduced once we factored in how much we can take off on TIF for the overall project,” said Ortiz-Hernandez. “We’re trying to get to the point where nearly all the lots pay for the infrastructure proportionally to the cost of the project.”
The city has plans to market the lots on their website, Zillow and other online sites.
“We are working on marketing the lots now that the prices are approved. We are working on websites and other marketing means to market the lots,” Ortiz-Hernandez said. “We’ve had realtors locally and regionally ask us for lot prices. We have fielded a dozen or more inquiries from private individuals, private contractors and developers.”
Ortiz-Hernandez credited the interest with the development’s proximity to Highway 20.
“I think with it’s location by Highway 20 people have been seeing the construction and seeing what has been going on and it has sparked their interest,” said Ortiz-Hernandez.
Covenants were also established and approved for BC 5 and 6 at Monday evening’s council meeting. The covenants maintain a number of rules and regulations that must be adhered to. For example, construction on a home on the lot must begin within 12 months of purchase. Construction, once started, must be completed in 18 months.
“I think the biggest stipulation that comes with purchasing a lot is the timeline to complete construction of the lot, which is included in the covenants,” said Ortiz-Hernandez.
The covenants also touch on landscaping, aesthetic issues and dwelling size requirements. For lots greater than 10,000 sq. ft., the dwelling must be at least 1,500 square feet and have a minimum of two garage stalls. For lots less than 10,000 square feet but more than 9,000 square feet, the dwelling constructed must be at least 1,200 square feet with a minimum of two garage stalls. For lots under 9,000 square feet, the dwelling constructed must be at least 1,000 square feet with one garage stall at minimum.
Individuals interested in lot pricing can call the City of Webster City at (515) 832-9151 and talk to Karla Wetzler or visit the city website at www.webstercity.com.
Brewer Creek Additions 5 and 6 were started earlier this year in April. Brewer Creek 5 is the northern portion and encompasses land from Fairmeadow Drive north to west of Kamen Drive. According to Ortiz-Hernandez, those lots were completed a few weeks ago. Brewer Creek 6 is just being completed. It encompasses the southern portion along Highway 20.
The overall subdivision of BC 5 and 6 will add 52 residential housing lots to the city. Each lot will be able to house a single-family dwelling.
“There’s a lot of attention on the region with so much activity happening here in Webster City and regionally,” said Ortiz-Hernandez. “There is a need for housing in the community. This is just one of the many efforts the city is undertaking to try to address the housing issues in the community.”