THE 1990’s
We said ‘Hello’ to the X Files, Cheers, Will and Grace and 6 Friends. We said good-bye to Johnny. And we could only hope that Hunter Green, carpeted baths, and inflatable furniture would not follow into the millennium. Michael Jordan and Chicago Bulls won six titles …. 91, 92, 93, 96, 97 and 98. We tuned in to Ice Ice Baby, Whitney and Celine. We Believed with Cher and were introduced to Britney and the Back Street Boys. Mandela was free and we first heard ‘internet’. Yeltsin and Clinton are in, and so is Harry Potter. The Dow Jones closes above 11,000 for the first time and we celebrate a budget surplus – first in thirty years. And we end the last days of 1999 in mortal fear of this lurking danger called Y2K.
ELECTIONS AND APPOINTMENTS
To Start the Era: The new decade arrived (without any significant Y2K hangover) and Jerome O’Connor takes over the HBAGC presidency from George Arquilla. James Hemphill is named as Senior Vice President. Vice President, Finance and Administration is under the guidance of Marsha Elliott. The role of Vice President in now held by Robert Verble. Steven Hovany of Residential Planning Corp will take on the role of Treasurer; and the role of Secretary is now being held by Vincent Fiduccia, who is also the outgoing chairman of the Custom Builders Council of Greater Chicago.
Past President Richard Brown was at the helm of HBAI. The iconic builder led HBAGC in 1986 and it was only natural that he would be elected to head the state and the voice for residential construction in Illinois and the umbrella organization for 23 home builder associations throughout the state. Richard Brown of Libertyville, a home building legend and pioneer, founder and president of Cambridge Homes, one of the largest home builders in the state since 1961.
Born in Chicago, Mr. Brown attended Purdue University in West Lafayette, Ind. Generously, in 2004 Richard and his wife Rita, gifted $500,000 to the University. His business developed many area communities, including Libertyville and Mundelein, where he built nearly a quarter of the homes. His developments always had character and amenities, which included parks, clubhouses and several home designs.
He diversified into retirement communities in the Chicago area, including the Carillon near Romeoville. His idea was to develop a community that was far enough away from the city but still close enough for the residents to stay in touch with family and friends.
“He was so far ahead,” said friend and colleague David Hill, chief executive officer of Kimball Hill Homes. “He did so many things with a great deal of planning and architectural integrity.”
Both of his sons followed him into the business. His son Scott died in 1989, Douglas Brown said. Mr. Brown was devastated by the loss and started an education fund in Scott’s name to help others who wanted to further their knowledge of home building.
Cambridge Homes was purchased in 1999 by D. R. Horton, a Ft. Worth, Texas, company. Mr. Brown and his son Douglas remained with the business and continued to run Cambridge Homes under its original name until his death in 2005. Mr. Brown was on several industry boards at local, state and national levels, including the Sustaining Builders Council, a group representing the Chicago area’s largest builders. He was also president of the Greater Chicagoland Housing Foundation and a director of the National Association of Home Builders as well as a lifetime director of HBAGC.
As expected Marsha Elliott rose through the ranks and became President of the Association in 1992. Certainly newsworthy, as she became the Association’s first woman president since its founding in 1940. She assumed the role previously held by James Hemphill.
THE EVOLUTION OF THE SMART HOUSE
We have to go back a bit to the 80’s to pick up the story of the Smart House. In 1986, Ruth Youngblood (UPI) might not have told us what we can do in a Smart House in great detail, but she did offer this: “ Husbands and wives in the 1990s will be asking the house, not the spouse to start the coffee, finish the laundry ……”
Cue George Jetson!
In 1987, the Director of Communications for the HBAGC, Steve Maentz asked us to just imagine what it would be like to telephone your house to regulate the temperature or to turn on the stove or the dishwasher. Or to have an in-home video system that would alert you if a door or window was open – and where it was.
There was chatter about full-scale security systems and even voice recognition. It was a new concept … and it was called the Smart House.
A few years prior, in 1984 the NAHB held a conference to discuss the Smart Home and it was attended by manufacturing firms, trade associations and government agencies. Soon after, it received a shot-in-the-arm when Congress passed the National Cooperative Research Act, permitting greater inter-firm collaboration so all the interested parties could talk and share ideas. Thirty manufacturers collaborated under the NAHB research foundation. GE, Honeywell, Whirlpool and government agencies were all charter members. This group was focused on a new home wiring system that the homeowner could instruct through a computer.
The market was intrigued and studies were held and found that consumers might be willing to pay between $5000 and $10,000 for the bells and whistles. This was the estimated cost for the early adopters, and everyone knew the price would fall [just like the pocket calculator did when it was first released, or the microwave oven].
In March 1986 the Smart House project being orchestrated by the NAHB produced a first look at the house – a 2 room showcase of ‘electronic marvels’ that many said would revolutionized the housing industry. The NAHB President David Smith was quoted as stating, “The Smart House will change housing more than anything else I`ve seen in my career.” And, “It will bring housing up to date with the space age and set the stage for 1990.”
The consumer was asked to imagine that they had just landed at the airport… they could pick up the phone and tell the microwave to start cooking dinner (no hint at who was going to put the meal in there), but we all saw the glitz, how this would help our daily lives and were planning on a little more relaxing time on the Lazy Boy, along with Judy Jetson. On the practical side was the promise of reduced electrical bills as all the smart appliances would only draw on the power it needs to run, not be on ‘standby’.
Fast Forward to 2004 …..In spite of the hoopla, appliance networking didn’t truly capture the hearts, minds or kitchens of America. So things are getting turned up a notch; now the buzz is about wireless technology. Devices would use a radio frequency of 2.4 gigahertz — the same as many cordless phones. We could be notified of certain actions … there could be a sensor in your mailbox to light up when your mail arrived.
Seventy companies – Motorola, Philips, Honeywell among them, formed a group that worked together and developed a Standard for the new technology. They called themselves the ZigBee Alliance.
That’s interesting! Picture a honeybee that has stumbled on a field of pollen and nectar-filled blooms – a ‘flow’. As you buzz back toward the hive, one thought crowds the bee brain: “Must tell the others.” But bees don’t talk and they can’t hear. But they do communicate – they dance! They zig, zag and waggle in the hive and it is called zig-bee. Totally wireless communication!
Fast forward to 2012. John Peck, 27, lost both legs and much of his arms while serving with the Marines in Afghanistan two years prior. Various foundations worked together and they built John a house; not just any house – they built him a Smart House. Kitchen cabinets lower themselves to countertop level, so he can reach the contents from his chair. Faucets turn on and off with motion sensors. Almost everything else — lights, television, thermostat — can be operated by John’s tablet.
WE NEED URBAN HOUSING!
Madison Street’s infamous Skid Row is long gone. Any new housing developments or plans for more had come to a stop after the 1968 riots. In 1987 Lewis Kostiner and his wife, Annie, saw an opportunity in residential real estate in the still depressed area, and developed Annie Properties. Kostiner asked the city to clean up the area, which was full of vacant lots full of abandoned cars and litter. “Potential residents would come here and say, ‘Great lofts, but look at the area.’ The city responded and in the early 90’s a $2 million Strategic Neighborhood Action Pilot Program to stimulate development in the area was approved. After the ‘clean-up’ the ball was tossed to private developers, and they caught it. Eight builders/developers participated in the 1995 City Parade of Homes, sponsored by the HBAGC in the neighborhood; the 2700 block of West Washington. The houses were priced from $110,000 to $170,000.
One of them was Jim Raymond, [who would become the HBAGC President in 1997], President of Lansing-based Raymond Development Corp. His firm built one of the eight show homes, and sold 6 as a result. The Parade of Homes on the West Side was more successful than anybody envisioned,” said William Maybrook, [1995 HBAGC President].
That’s Interesting! Do you know what was listed as the most important criteria for homeowners in 2015? 59% of respondents said Quality of Neighborhood.
FIGHTING QUOTAS
In 1996 the Builders Association of Greater Chicago filed two lawsuits in U.S. District Court. One suit was against Cook County and the other suit was against the City of Chicago.
The HBAGC claimed that the association’s member contractors had been denied bids, even when they had bid the lowest price, because of the [quota] requirement. And that Chicago had encouraged and perpetuated racial, ethnic and gender-based discrimination against non-minority owned entities in the award and performance of its contracts through its ordinances, policies, procedures and requirements . . .
The association also stated that its members have lost profits by being forced to enter into joint venture agreements with minority subcontractors when they could have done the work themselves ….. [abbreviated due to space]
The Builders Association successfully argued that the (racial) minority and woman business quota programs operated by the county and the city were unconstitutional. One quota quite possibly opened doors to fraud and corruption, while the other allowed for reverse discrimination.
In November 2000 the Cook County’s program was struck down.
In December 2003 the City of Chicago’s program was struck down and the city was given six months to make changes.
2000 – 2015
Katrina, tsunami, earthquakes. September 11. G. W. Bush and Obama are in and Castro is out. ‘Social Media’ enters the lexicon and FaceBook and YouTube become verbs; iPods, iTunes and iPhones all are introduced. We are into West Wing, Buffy, Grey’s Anatomy and Lost. (The 2000 version of Gilligan’s Island). We laugh while watching The Big Bang Theory. The tech bubble burst and hundreds of dotComs are gone. The sub-prime mortgage Crisis hits banks.
ASSOCIATION NEWS
The Association and its 3 chapters are active. Joining the HBAGC automatically enlists members to Home Builders Association of Illinois (HBAI) and the National Association of Home Builders (NAHB). It is pledged that ‘you will gain access to a wide variety of industry information, services, and activities that will contribute to your personal as well as professional success.’
Networking is possible at the general membership meetings and by participating in committees. Membership has its privileges! There are educational resources available for those wishing to add certifications to their resumes, and a variety of workshop and seminars offered to keep on trend. Newsletters, white papers and other collateral is available. And there are field trips such as; the Annual Tour of Homes, Medley of Homes and the tour of Remodeled homes. Great for seeing the big picture and all the Tips, Tools and Techniques.
And of course any self-respecting Association has to take a break and have some fun. Between the umbrella and 3 chapters, members can participate in a variety of events – the annual golf day, boat cruise, After Hours. And of course the big fete of the year – Key Awards and Holiday Party.
THE KEY AWARDS
In the early 70’s the Association started recognizing its own and the Key Awards were the vehicle used to celebrate and acknowledge contributions. HBAGC holds an annual Key Awards competition to honor excellence among their members. The Key Awards recognizes those builders that excel in architectural design, quality of construction and innovation. Specialized judging teams, comprised of experts and peers in each field, evaluate each entry within various categories based upon the above criteria and award a total point score.
The highest score in each category receives a Gold Key, second highest a Silver Key and third highest score receives a Bronze Key. The most coveted of the awards is the Crystal Key. The Crystal Key represents a special level of achievement that awards innovation and creativity.
The awards represent an annual celebration of the best in our industry in the Chicago area, and there is no greater honor than being recognized by one’s peers for quality and excellence.
Earning a Key Award comes with a certain level of prestige and recipients proudly make sure their current and prospective clients are made aware of their accomplishment by posting an announcement on their individual websites, within their collateral and sharing the news via a Press Releases.
In 1992, the Chicago Tribune reported that these “Oscars” of the home-building industry went to 145 winners in the areas of exterior and interior designs, landscaping and land planning and the Key Awards ceremony had over 400 attendees.
AFFORDABLE REQUIREMENTS ORDINANCE
Since it was put into effect in 2003, Chicago’s Affordable Requirements Ordinance (ARO) has been a mechanism for the creation of affordable rental and for-sale housing in private developments. Developments subject to the ARO are required to set aside 10% of units to be built as affordable housing, and any projects receiving financial assistance from the City are required to make 20% of the units ‘affordable’. Those developers who decide to opt-out of building these units can instead pay a fee of $100,000 per unit.
It is not a big secret that Chicago does need more affordable housing, what large metropolitan area doesn’t? And Chicago residential developers are, and have always been generous – and before it became mandated, and remain ready to help. But the ordinance has always been a bit sticky and a bit of a thorn. And new regulations are posing new challenges.
As a group, the residential development community believes the ordinance’s fee and unit requirements have too high of an impact on small and medium-sized builders, resulting in the unintended consequence of making it difficult, or even impossible to finance new housing projects.
HBAGC is backing a local developer who is being stalled by the requirements. They are stating that the city’s ARO is in direct violation of the constitution as the Fifth prohibits the taking of private property for public use without just and fair compensation. And some interesting finagling regarding issued – then adjusted building permits are adding fuel to the fire. The city responded stating that the suit “has no merit” and plans to “defend the ordinance vigorously.”
It has been reported by a local public radio station that over $77 million in ‘opt-out’ fees have been paid over the past 10 years by Chicago developers. Guaranteed that this is a case that will be watched with great interest.
CHALLENGES IN THE BUILDING INDUSTRY
The period known as the Great Moderation came to an end when the decade-long expansion in US housing market activity peaked in 2006 and residential construction began declining. In 2007, losses on mortgage-related financial assets began to cause strains in global financial markets, and in December 2007 the US economy entered a recession. That year several large financial firms experienced financial distress, and many financial markets experienced significant
turbulence.
The headline glared “Home Builders Group Files Chapter 11”. Following a loss of over $240K in 2007, $283K in 2008, and $257K in the first 9 months of 2009, the association had no other option than to file for bankruptcy and then restructure and continue. They were certainly not alone and many builders succumbed to the industry slump. Forced to sell the Addison building, built only a few years prior was one avenue the association took to manage the debt. A priority was to settle with suppliers who had been waiting for payment. They had reduced paid staff to a single employee.
The Home Builders Association of Greater Chicago had 1,600 members at its height five years prior. In 2010, membership had shrunk 75% to just 400 firms, according to Executive Officer Rita Unzner. We had a staff of two dozen just three years ago. “Today I’m the only one left,” she says.
The association has continued operating and is emerging from bankruptcy protection after restructuring its debt. A continuing challenge will be to increase membership, as membership fees are integral to supporting the association. Rita Unzner has been planning, organizing, directing, and coordinating the programs and activities of the Association to assure that objectives are attained, plans fulfilled and member needs are met for 18 years. It’s no wonder that most of the association’s members call her the backbone or the glue of the association. Few professionals require as many separate skills of its practitioners as does professional association management. The typical E.O. (if there is such a person) is expected to be skilled in news and technical writing, public speaking, office management, press relations, bookkeeping, budget development, group dynamics, consumer relations, promoting, publication layout, human relations, legislative representation,…and the list goes on. Rita Unzner, has gone above and beyond the typical Executive Officer, carrying and leading us through the toughest of times and will continue to do so as the association gains momentum into the future.
WHAT IS AHEAD?
We noted earlier that members had the opportunity to learn about new Tips, Tools and Techniques by touring homes and attending educational opportunities. We found some interesting bits (pardon the pun) about Tools and how they came about. Who knows what innovations will be seen between now, and when the HBAGC celebrates their 100th Anniversary!
The first electric drill is credited to Arthur James Arnot and William Blanch Brain of Melbourne, Australia who patented the electric drill in 1889. In 1921 full-page ads appeared for this Black and Decker drill. Forty years later they introduce the world’s first cordless electric drill powered by nickel-cadmium cells.
That’s Interesting! The use of a large circular saw in a saw mill is said to have been invented in 1813 by Tabitha Babbitt, a Shaker, after she noted the inefficiency of the traditional saw pits used by the sawyers in her community and sought an improvement. She came up with a prototype, attaching a circular blade to her spinning wheel.
The ‘circular’ saw was invented in England at the turn of the nineteenth century, though there is considerable disagreement on precisely when and by whom the tool was devised, so no one gets the credit!
That’s Interesting! When was the hammer invented? Before there was paper to record the deed! But, Charles Brady King of Detroit [officially] patented his hammer in January 28, 1894.
In 1938 the first fiberglass insulation was produced. It was invented by the Owens Corning Company, which is the world’s number one producer of fiberglass to this day; although it had to work its way back after declaring bankruptcy in 2000 to reorganize after an onslaught of lawsuits related to asbestos. It emerged from Chapter 11 in 2006. Fact: Owens-Corning reported sales for 1938 total $2.6 million; employment is 632. Fact: Owens Corning makes the Fortune 500 list for the 59th consecutive year in 2012. The company has been on the list every year since Fortune started it.
That’s Interesting! The median size for homes purchased in 2015 was 1,900 square feet.
Fast forward to 2016 – Lowe’s Innovation Labs, the disruptive innovation hub of Lowe’s Companies, Inc., has partnered with aerospace company Made in Space, to become the first to launch a commercial 3D printer to space. The printer, the first permanent additive manufacturing facility for the International Space Station (ISS), will bring tools and technology to astronauts in space. At the same time here on earth, Lowe’s is launching the next-generation Lowe’s Holoroom – an in-store and at-home virtual reality design tool that enables customers to envision the room of their dreams.
The Lowe’s 3D printer is slated to arrive at the ISS in early 2016, making Lowe’s the first retailer to have a presence in space. From 200 miles above Earth, astronauts can use 3D printing technology to create a tool on-demand and produce parts they may not have onboard and immediately available.
The evolution of 3D-printing technology is continually finding new ways to impact not only how we live, but also what we live in.
Attendees at the 2016 NAHB International Builders’ Show in Las Vegas this January will get to experience what life would be like living in a 3D-printed home, which comes complete with a 3D-printed vehicle.
Who knows what further advancements in tools we will see in the future? But we can be assured that the Tips, Tools, and Techniques will continue to improve. Glancing back at this series certainly provides us with a snapshot of who the HBAGC is and how we got here! Who knows what the next year will bring – much less – the next 25! It will be Interesting!
