Homebuilder AZ July / August 2010

This Issue’sBuilder Profile:

p.7

DEFENSIVEROOFING

Not All ‘Radiant Barrier’Products Offer the Same

Level of Performance

PROTECT YOURCORPORATEBRANDThree Rules for PreventingBad Press Generated by Social Media

[plus]

The Premier Magazine for the

Arizona HomeBuilding IndustrytheHBmag.com

July/August 2010 /// “THE POWER TOOL FOR BUILDING YOUR BUSINESS.”

TM

COVER IMAGE: Forté Homes

$4.95US $5.95CAN 07>

480 443 7750 L P I

FORTÉHOMES

One of Arizona’s Largest Custom Homebuilders

Looks Ahead

AZHB_0704_Layout 1 8/30/10 4:37 PM Page 1

AZHB_0704_Layout 1 8/19/10 10:45 AM Page 2


2 theHBmag.com

P.10

P.12P.7

TM

IN THIS ISSUE /// July/August 2010

6 Publisher’s NoteFocusing on Strengths

7 Builder Profile: Forté HomesThese Custom Homebuilders Are Looking AheadAlthough tougher lending guidelines, investment buyers and “strategic” foreclosures

are still affecting new-home sales in the Valley, this builder predicts a slow but steady

increase in sales over the next two years.

10 Protect Your BrandThree Rules of Social Media MarketingBusinesses must have a presence 24/7 as part of a deliberate social media

optimization process to ensure that its corporate audience is larger than that of

any customer who may come through their doors.

12 Applying SunblockNot All Radiant Barriers Are AlikeChoosing the right radiant barrier product for roofing gives homebuilders an

opportunity to make their homes greener and homeowners happier.

HB ContentsTM

On the CoverThis 5,400-square-foot Forté custom home was built inCalabrea in the AhwatukeeFoothills, and includes aspacious interior courtyardand a wine room.

��

One of Arizona’s Largest Custom Homebuilders

Looks Ahead

This Issue’sBuilder Profile:

p.7

DEFENSIVEROOFING

Not All ‘Radiant Barrier’Products Offer the Same

Level of Performance

PROTECT YOURCORPORATEBRANDThree Rules for PreventingBad Press Generated by Social Media

[plus]

The Premier Magazine for the

Arizona HomeBuilding IndustrytheHBmag.com

July/August 2010 /// “THE POWER TOOL FOR BUILDING YOUR BUSINESS.”

TM

COVER IMAGE: Forté Homes

��

480 443 7750 L P I


Everyone loves a café.Now, everyone can have one.GE Café™ is GE’s first new line of appliances in 15 years, and it’s an exciting new salesopportunity. With stainless steel exterior and robust styling, builders and new homebuyers will want to make it the centerpiece of their new home. For remodelers and theircustomers, the GE Café will easily transform any kitchen with restaurant-inspired design.At long last, everyone can afford to have an inviting café – right at home.www.geappliances.com/café

Come see our fine GE Appliances at Westar Kitchen & Bath at the Tempe,Scottsdale, Peoria and Tucson locations. Phone: (602) 271.0100


VOLUME 7, ISSUE 4 July/August 2010 HBPRESIDENT Trifon M. Kupanoff, Jr.

PUBLISHER Michael A. Kupanoff

EDITOR Tammy LeRoy

EDITORIAL INTERNS: Travis Duprey, Trey Warren

CREATIVE DIRECTOR Neal McDaniel

WEB DEVELOPER Theo Tigno

SUBSCRIPTIONSPhone: 480.443.7750 ext. 312Email: [email protected]

ACCOUNTINGPhone: 480.443.7750 ext. 312Email: [email protected]

CONTRIBUTING WRITERS:David Drew, Maurice A. Ramirez

EDITORIAL AND ADVERTISING OFFICE:HB Magazine15170 N. Hayden Road, Ste. 5, Scottsdale, AZ 85260Phone: 480.443.7750 • Fax: 480.443.7751Email: [email protected]

PLEASE SEND ADDRESS CHANGES TO:HB Magazine15170 N. Hayden Road, Ste. 5, Scottsdale, AZ 85260

REPRINTS/E-PRINTS:Call 877.652.5295 or Email: [email protected]

HB Magazine is published six times per year by LPI Multimedia Inc.Opinions expressed are those of the authors or persons quoted andnot necessarily those of LPI Multimedia Inc.While efforts to ensure accuracy are exercised, the publisher

assumes no liability for the information contained in either editorial or advertising content.Publisher assumes no responsibility or liability for unsolicited manuscripts or artwork.Reproduction in whole or part without the expressed written consent from the publisheris prohibited. HB Magazine is the registered trade name of this publication. Copyright ©2010 by LPI Multimedia Inc. All rights reserved.

LPI Multimedia Inc. is a proud member of:

15170 N. Hayden Road, Ste. 5, Scottsdale, AZ 85260T 480.443.7750 F 480.443.7751 www.lpimultimedia.com

HB Magazine is a subsidiary of

4 theHBmag.com

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The Premier Magazine for theArizona HomeBuilding Industry

I N S P I R A T I O N S • L I F E S T Y L E S • S O L U T I O N S

FINALLY! A TRUE HOME IMPROVEMENT AND REMODELING RESOURCE LIKE NOTHING ELSEIN THE VALLEY!

Providing homeowners with products, services and timely editorial to enhance their lifestyles

and increase the value of their homes.

A D V E R T I S I N G O P P O R T U N I T I E S A V A I L A B L E

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Showcase Your New Home Communities.Be a part of Arizona’s only local new homes website and increase your market share!

• The only comprehensive, easy-to-use new homes website forArizona with interactive maps, video and photo presentations.

• New home shoppers are driven directly to newhomestoday.comthrough local magazines, TV and billboard.

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ISSUE_AZHB_0605:Layout 1 10/13/09 6:51 PM Page 7

Focusing on StrengthsLike you, we at HB are encouraged by increases in summer home sales in theValley, and we are confident that the next wave of home buyers is already on the way.

According to Merriam-Webster’s, the word forté means “one’s strong point.” The ownersof Forté Homes, our builder profile in this issue, believe their strengths lie with thecompany’s business philosophies and its people. What are your company's strong points,and how are you taking advantage of those strengths?

Another feature looks at radiant barriers for today’s roofing, and our Marketing Matterscolumn shares three rules for social media you'll want to keep in mind to protect yourcompany's brand integrity.

As Arizona homebuilders navigate through the changing dynamics of today’s market, HBwill be here, bringing you timely and relevant information to help you make sounddecisions for your business.

Michael A. [email protected]

6 theHBmag.com

PUBLISHER’S Note /// July/August 2010

Help us keep our subscriptionlist current! If you or a colleaguewould like to receive HB at nocharge and are not currentlyon our subscriber’s list, go towww.homebuilder-az.comand click on “Subscribe.”

SEEN.HB

THE MOSTAFFORDABLEWAY TO REACH YOURHOMEBUILDERS!

APPLIANCE TRENDS

Today’s kitchens blend functionality

with style

FRAMINGSOFTWARE

Prevent costly

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November/December 2009

COVER IMAGE:Lennar Homes’Vision

at Layton Lakes in Gilbert

HBTM

"e Premier Magazine for the

Arizona HomeBuilding Industry

HOMEBUILDER-AZ.com

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GREENFROM THE

OUTSIDE INIncrease efficiency

with

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This Issue’s Builder Profile:

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Evolutionary

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///////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////

FORT É HOME STHESE CUSTOM HOMEBUILDERS

ARE LOOKING AHEADby TRAVIS DUPREY

HBBuilderProfile

info link ///fortehomes.com


8 theHBmag.com

HB Profile

“SINCE FORTÉ HOMES BEGAN BUILDING LUXURY HOMES, THE COMPANY HAS UTILIZED MATERIALS AND CONSTRUCTION

TECHNIQUES FROM ALL OVER THE WORLD TO CREATE STUNNING FINISHES, UNIQUE TO THE CUSTOMER’S PERSONAL TASTE.”

/////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////

One of the Valley’s largest custom homebuilders,Forté has been building luxury homes since principals John Perkins and

John Cochran started the company in 1993. The company’s superintendents

and project managers—all of whom were previously licensed custom home-

builders—supervise a limited number of homes in a small geographic area.

This, combined with Forté Homes’ skilled support staff, brings a depth of

experience to the Forté team.

Since Forté Homes began building luxury homes, the company has utilized

materials and construction techniques from all over the world to create stun-

ning finishes, unique to the customer’s personal taste. The builders offer a

variety of architectural styles including Southwest, traditional, contempo-

rary, Mediterranean, Santa Fe, mission and prairie, and are experts in de-

manding lot situations including hillside conditions with multilevel designs.

Like other homebuilders in the area, the company has seen its ups and

downs. Forté built more than 50 homes and had 24 employees in 2007;

they now count 10 employees and have been building fewer houses since

then. Still, Perkins and Cochran say they have managed to stay profitable

in a difficult economy.

Obstacles to OvercomeMost of Forté’s customers are local move-up buyers including profession-

als and business owners. Intel has been one of their largest sources of

buyers. “They are affected by the overall economy, compensation levels and

job security,” Perkins says, adding that loan requirements are much stricter

than in the past. “Not only are they buying an expensive house, they have

to come up with more money up front,” he notes.

The ability of a buyer to sell an existing house has been another problem in

the current market. “Before, people were very comfortable with the prospect

of selling their existing houses,” Perkins says. “They could usually get a

home equity line of credit and start the construction of a new house

without having to move out of their old house, because they were confident

they would be able to sell it quickly. People no longer have that level of

confidence, and that puts a damper on things.”

Cochran says one of the biggest challenges to selling high-end homes

currently is strategic foreclosures. “It’s becoming an accepted practice for

people upside-down in their house to short sale the house and take a

credit hit instead of taking the value loss on the house,” he says.

H O M E S


theHBmag.com 9

Perkins believes the Phoenix housing market has always been driven by

population growth, which is mostly driven by job growth. “We are never

going to have a thriving housing market again until we start to create jobs

and people start moving here again,” says Perkins. However, Perkins expects

the job growth situation to turn around. “It’s a desirable place to live and

many people would like to move here who just can’t right now because there

is no job for them. I think this is the biggest thing standing in the way of

Valley homebuilders.”

He also acknowledges that there is still some inventory left that has to work

itself out. “Much too much of our market is short sales and foreclosures and

investor purchasing, but that’s just the natural way it gets cleaned up,”

Perkins says, adding, “We have a ways to go.”

With all of the inventory that still exists being dumped by banks at below

construction costs—costs no builder can compete with—Perkins notes that

buyers are finding that those deals come with a cost. “It can be difficult to get

the deal you want with these houses,” he says, “and even if you can, you will

have to make sacrifices. You’re more than likely buying a remodel project.”

Cochran notes that the industry trades have also been hit hard. “Many are

out of business and the ones that remain are much smaller,” he says. “It’s the

same for them as it is for us; you have to be competitive and innovative.”

Although most builders knew the bubble would eventually burst, few

predicted the extent of the crisis for the industry. “I would have sold my

land before the market collapsed, but other than that, I would not have done

things too differently,” Cochran says, noting that they were fortunate in

some aspects.

“We had some specs on the downside but we still made money on them,”

he says. “We sold two specs last year—one for $1.73 million and one for

$1.47 million—and we made money on both of them where everyone

else was losing money.” As soon as the downturn began, Forté cut back

on building specs and model homes.

The End of the TunnelLewis and Cochran are able to see some positive aspects of the crisis as well

as light at the end of the tunnel. Lending, for example, is beginning to

normalize. “It is trending back to a little bit better rates and more lenders

in the game for jumbo loans,” Cochran says.

Low interest rates have helped as well, although there are political challenges

in keeping them low. “There has been talk about taking away or reducing the

interest deduction, and if that happens, we will be severely disrupted,” says

Cochran. He is especially concerned it may be eliminated for high-end

buyers; his customers. Because of these and other political challenges for the

industry, Cochran stresses the importance of the NAHB as well as local

associations, and he believes all builders should be members.

With all of the disruption, Lewis and Cochran are optimistic about the

company’s future as well as that of the local industry. “What’s going well,”

says Cochran, “is that [home prices have] gotten back to affordable.” He

notes that land prices have come down between 50 percent and 80 percent,

which is definitely helping the market. “Even if we took a hit holding it,”

Cochran says. “Combined with lower construction costs, this may induce

new customers to buy custom homes.” n

Travis Duprey is an editorial intern for Arizona HB magazine.


10 theHBmag.com

HB Marketing Matters

Social networks such as Twitter, Facebook and YouTube have put the power of the media in hands of the entrepreneurs, information marketers and college students who have learned that they can be a media source for audiences large and small. Even the nightly news and the traditional print media will sometimesshare their stories. With this shift in the “power of the press,” business owners should be mindful of three rules of social media marketing to help ensure that their businesses are not damaged by press generatedthrough social media.

P R O T E C T Y O U R B R A N DThree Rules of Social Media Marketing

by MAURICE A. RAMIREZ


theHBmag.com 11

HB Marketing Matters

info link ///

graphics. As a result, for many

companies, the rules are difficult to negotiate.

But one of the rules that is constant across all

social media platforms is that the first story

told is the first story believed. Further, in the

social media, the first story about a major

event—whether positive

or negative—will be

retold, retransmitted

and shared among social

media users.

The first story told is also the most likely story

to make the transition to traditional media

and become news. Hence, it isn’t enough to

respond when a message appears on one of the

popular social media platforms. Instead, when

an event occurs, a

business must have

a prepared state-

ment ready to

transmit imme-

diately through an established social media

optimization program to ensure that the

corporate message is the first story told.

Buzz is the bomb. A positive buzz means that

there is positive message activity around your

brand. But if the sentiment surrounding your

message is negative, buzz can blow up in

your face. Research shows that a negative

message will be sent on four times more

frequently than a positive message, doing four

times the damage, influencing four times as

many people not to buy.

The easiest way to ensure that something good

is said is to influence those who influence others

to say something good about you. Again, this

is done by having a constant positive presence

in the social media even before anything

noteworthy happens at your company.

These three rules of social

media marketing apply to businesses large and

small. Turn on the news any night and you will

see companies that have failed to follow these

three simple rules—whether it’s a cruise ship

with a passenger falling overboard and 124,000

tweets telling the story of how they left him

behind, or a major amusement park with the

most anticipated themed ride in a decade

breaking down and trapping riders for 45

minutes—generating 50 YouTube uploads.

To succeed in the social media remember:

Silence is not golden, businesses must be in the

social media early, regularly and constantly.

The first story told is the first story retold. To be

the one telling your story and influencing others

to retell your story,

businesses must take

ownership of the the

message or someone else

will fill the void and tell

your story from their perspective. And finally,

buzz is the bomb. Be sure the buzz surrounding

your company is positive. n

Dr. Maurice A. Ramirez is founder of High Alert,

LLC, is a renowned speaker on the importance of

social networking, and a consultant who assists

companies in aligning their business continuity

plans with personnel and customer behavior

during adversity. Dr. Ramirez is founding

chairperson of the American Board of Disaster

Medicine and a Senior Physician-Federal

Medical Officer.

In high school science, we learned that nature

abhors a vacuum. Nowhere is this more true

than on the Internet. If your company fails to

comment on a newsworthy event, the social

media will rush in to

fill the void regarding

your corporate brand.

Whether it’s iPhone,

Coca-Cola, Disney or

an unknown convenient store on the corner in

your town, if something noteworthy happens,

someone must comment. And it’s not only

words but also images that can send a message

about your business. With the advent of internet

enabled cell phones, YouTube enabled smart

phones, and location enabled Twitter, everyone

is not only a news reporter but also a video

historian. Nothing is more powerful than

eyewitness testimony, both in a court of law and

on the six o’clock news.

Many regular bloggers, regular Twitter

broadcasters and regular YouTube posters have

followers. And their followers have followers.

The average reach of these individuals is over

20,000, and their audience is reliable. This

means that corporations cannot simply

broadcast a message in the social media only

when something happens; corporations must

have a presence 24/7 as part of an ongoing

plan and a deliberate social media optimization

process that ensures that the corporation has

a corporate audience larger than that of any

client or customer who may come through

their door.

Social media is a cultural phenomenon based

on a conglomerate of social norms and

behaviors that span age groups and demo-

highalert.com


perforated(or incised)barrier that will block heat

but not trap construction moisture in the wood.

It is also possible to install a layer of aluminum

to an existing home. The aluminum is simply

stapled to the roof trusses or rafters. Installers

should never apply the aluminum sheathing to

the attic floor because the radiant barrier can

lose its effectiveness in less than a year as dust

accumulates on the surface. There may also be

problems with moisture development and

aluminum being too close to electrical wiring

and fixtures.

When correctly installed, radiant barrier

sheathing and retrofit aluminum material will

block up to 97 percent of the heat in the

roofing materials from reaching the attic space.

This can lower the attic temperature as much

as 30 degrees and can reduce the cost of

cooling the home up to 17 percent during the

summer months.

In the summer when the sun heats up the roof

of a home, a radiant barrier helps seal heat

energy in the roofing materials so it doesn’t

reach the air inside the home and

the air conditioner doesn’t

have to work as hard to

maintain a comfortable

indoor temperature. Energy

bills go down, and comfort

goes up.

Unfortunately, not all products that

claim to create a “radiant barrier”

provide the same level of performance. The

most cost-effective form of radiant barrier is a

thin layer of aluminum attached to the

underside of the roof deck material. Aluminum

holds its heat energy, barely radiating any of it

into the air, making it an ideal barrier material.

With new construction, a homebuilder can

select roof sheathing that already includes a

radiant barrier. In these cases, we recommend a

12 theHBmag.com

HB TechKnowlogy

The U.S. Department of Energy recognizesthat installing radiant barrier products canreduce a homeowner’s monthly energybills—so choosing the right product giveshomebuilders an opportunity to make theirhomes greener and homeowners happier.

LP TechShield helps block radiant heat in the roof fromentering the attic, keeping the attic cooler, loweringenergy costs and making the home more comfortable.

APPLYING SUNBLOCKNot All Radiant Barriers Are Alike

by DAVID DREW


INSTALL SUNSCREENS TODAYTHE SUMMER HEAT HAS ARRIVED!

Family owned and operated for 18 years! We will beat any reasonable estimate by 5%!Also ask us about our Blinds and Shutters!

Contact us today for your free estimate!

602-795-4258www.arizonaccsunscreens.com

n keep your home coolern protect your carpet, blinds, shutters,

& furnishings from harmful UV raysn provide daytime privacyn pays for itself within the first year

through energy savings!n slash cooling costsn cut the sun's heat & glare

CCsunscreenssunscreens

theHBmag.com 13

HB TechKnowlogy

Sheathing Versus PaintA variety of paint products infused with ceramic

or aluminum powder promise to perform a

similar function but with lesser results. These

paints are and can be sprayed onto existing roof-

ing materials. Homebuilders and remodelers are

often tempted to select paint over retrofit

aluminum materials because it is less expensive

to install in an existing home. However, these

paints do not technically qualify as a radiant

barrier under today’s industry standards.

The American Society of Testing and Materials

International (ASTMI) states that a radiant

barrier must block at least 90 percent of heat

energy. No brand of ceramic or aluminum-

infused paint met the ASTMI standard in testing

sponsored by the Reflective Insulation Manufac-

turers Association (RIMA), although many of the

seventeen products tested claimed to be “radiant

barrier paint.”

Only five paint products met a lesser standard of

blocking at least 25 percent of heat energy. These

paints are properly referred to as an, or IRCC, not

a radiant barrier. Homebuilders can check the

quality of a paint product by examining the label

for an emissivity number. This number should

be 0.1 or lower for a radiant barrier or 0.25 or

lower for an Interior Radiation Control Coating

(IRCC). And some require two or even three

coats to meet the stated energy savings.

Homebuilders have a variety of options to improve

the energy efficiency of their homes by applying

aluminum to roofing materials. Although paints

can offer limited protection at a lower cost, prop-

erly installed aluminum radiant barriers provide

superior performance and greater reliability. n

David Drew, OSB Technical

Sales Manager for Nashville-

based LP Building Products, is

a nationally recognized leader

in the field of residential

energy efficiencies, specializing

in radiant barrier technologies.

LPCorp.cominfo link ///



7

FOLD

FOLD

APPLIANCE TRENDSToday’s kitchens blend functio

nality with style

FRAMINGSOFTWARE

Prevent costlyerrors and delays


COVER IMAGE:Lennar Homes’Visionat Layton Lakes in Gilbert

HBTM



HOMEBUILDER-AZ.com

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480 443 7750LP I

GREENFROM THE

OUTSIDE INIncrease efficiency with

structural insulated panelsThis Issue’s Builder Profile:

p.17

DynamicDesignsAluminumpanels addpizzazz to walls.

EvolutionaryEstimator


SignatureScrewsCreate acleaner, moreattractive deck.

Industry News:

Local and nationalnews forhomebuilders



�Association News

Request for More Information or a Subscription

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July/August 2010

Type of Construction: (check all that apply)o Single-Family. Customo Single-Family. Spec/Tracto Multi-Family. Rentalo Nonresidentialo Commercial Remodelingo Residential Remodelingo Home Manufacturero Other, please specify ___________________________

Do you plan to build in the next six months?o Yes o No

If yes, please indicate below what you plan to build:o Single-Family. Customo Single-Family. Spec/Tracto Multi-Family. Rentalo Other, please specify ___________________________

Annual dollar volume of allconstruction/development:o Over $10 milliono $5 million - $10 milliono $1 million - $4 milliono Under $1 million

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Select the category that best describes your title:o Owner, Partner, CEO, Directoro Architect, Designer, Engineero Construction manager or Superintendento Sales and Marketing Managerso Other Management Personnelo Carpenter, Draftsman or Salesmano Other, please specify ___________________________

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Remodelero Architect/Engineero Product Manufacturero Wholesale Distributoro Other, please specify _________________________

Is this your copy of HB Magazine?o Yes o No

CONNECTED.HB

[featuring]3Products3Services3Trends

3Tips3News

HBTM



TM

HBTM


7

APPLIANCE TRENDSToday’s kitchens blend functio

nality with style

FRAMINGSOFTWARE

Prevent costlyerrors and delays


COVER IMAGE:Lennar Homes’Visionat Layton Lakes in Gilbert

HBTM



HOMEBUILDER-AZ.com

$4.95US $5.95CAN 07>

480 443 7750LP I

GREENFROM THE

OUTSIDE INIncrease efficiency with

structural insulated panelsThis Issue’s Builder Profile:

p.17

DynamicDesignsAluminumpanels addpizzazz to walls.

EvolutionaryEstimator


SignatureScrewsCreate acleaner, moreattractive deck.

Industry News:

Local and nationalnews forhomebuilders



�Association News

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