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Former Del Webb CEO to Builders: ‘Do Your Homework’
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LeRoy Hanneman, Jr.
Former Del Webb CEO and president | LeRoy C. Hanneman, Jr., one of the top experts in the 50+ housing field, has been involved in all facets of the active adult building industry. As the former CEO and president of Del Webb Corporation, now a brand of Pulte Homes, Hanneman was instrumental in making the Sun City name synonymous with active adult living.
Hanneman will speak at the “Building For Boomers & Beyond:50+ Housing Symposium 2006" in Phoenix, which will be held April 24-26.
His talk, “X’ers, Boomers, Seniors: Building with a Mindset,” will address how understanding the motivation of boomers can help the building industry make the most of this emerging market.
Below, Hanneman answers several questions about some of the changes he’s seen in 50+ housing and what he sees on the horizon for the industry.
NAHB: How has the active adult industry changed since you began at Del Webb?
Hanneman: The active adult market is far more competitive and geographically diverse than it was in the 1970s and '80s. Back then, there were just a handful of companies specializing in delivering the active adult lifestyle in typical destinations like Arizona and Florida.
Today, the active adult market is segmenting at a dramatic rate, due to the relative affluence the baby boomers enjoy versus that of the prior senior generations. They know what they want and they are willing to pay for it. A cookie-cutter approach to housing design doesn’t work anymore. My assumption is that this segmentation of the market will continue.
NAHB: How are today’s consumers different than when you first came on the scene? How are the baby boomers rewriting the rulebook?
Hanneman: Back in 1960, when the first Sun City was unveiled in Arizona, it was the talk of the country. Buyers from all over stormed into the Phoenix-area community for the chance to purchase their retirement dream home — a 950-square-foot, brick-built home with two bedrooms and one bath for $8,500.
The recreation center with its swimming pool at that first Sun City seems downright antique by today’s standards, but 46 years ago it delivered a little slice of heaven.
The old idea was to deliver a “one size fits all” home and community, and it worked very well for a long time, but those days are past us now.
Today, the active adult buyers want more sophisticated home designs and more tailored lifestyle activities. The shuffleboard courts of yesteryear have been replaced with technology labs and health/fitness spas. They also want a variety of destination choices — not everyone prefers the Sun Belt.
NAHB: How can builders meet the unique needs of today’s evolving 50+ consumers, especially their desire for upscale housing? What do today’s buyers want?
Hanneman: Today’s consumers demand a market-driven, bull's-eye design response. Enclaves are hot; mega communities are not.
Location is important, as are access to services, entertainment, education and quality medical care.
NAHB: Sun City was once the model for active adult communities. What do you think is the next big thing that will take the industry by storm?
Hanneman: The Sun City concept has evolved with time. The newer Sun Cities are often smaller than the original 8,900-acre community. And they have the lifestyle offerings that today’s buyers want.
I headed the Las Vegas operations for Del Webb for many years, bringing three Sun Cities out of the ground, including one located within the Del Webb master-planned community of Anthem, an all-ages community. I believe the idea of including active adult neighborhoods within multi-generational communities has tremendous merit and will continue to grow with demand.
I also believe that boutique communities that target a very specific customer profile, coupled with a precise execution of their product design and amenities, will do well. An example of this would be a community with a fitness/spa amenity theme where the housing product also accommodates fitness and health components, such as a personal exercise room or a gourmet-style kitchen for special dieting needs.
Of course, any community design must accommodate and provide solutions for the customer’s physical, mental and social needs.
If the amenity package budget can’t stretch far enough, those extras must be available in the surrounding area, supplementing the builder’s package.
For example, builders can entice seniors to weekday vacancies at an off-site daily-fee golf course by arranging for and offering discount pricing to their 50+ buyers. This enables builders to supplement their amenity package without adding the cost of building a golf course to their community.
NAHB: What can builders and others in the housing industry do to maintain a competitive edge? How can they compete with Pulte/Del Webb and the other large national builders?
Hanneman: Builders need to do their homework — to precisely tap the market segment they are targeting.
Make no mistake, an active adult housing purchase is purely discretionary. Active adult buyers don’t need to buy from you or anyone else.
What are you doing differently that will pull them to you? What are you delivering that makes them excited about the expanded potential of their lives?
Finally, don’t get greedy. You must execute exactness and deliver both value and quality. Integrity in the active adult industry is crucial to success.
Time is Running Out to Register for the 50+ Housing Symposium
Do you want to learn more about the fastest-growing segment of the housing market? You still have time to register for “Building for Boomers & Beyond: 50+ Housing Symposium 2006,” April 24-26 in Phoenix.
The seniors housing symposium is the premier educational and networking event for industry professionals who serve the burgeoning 50+ market.
For more information and to register, click here.
 Find Out What Boomers Want
“Boomers on the Horizon: Housing Preferences of the 55+ Market,” available through BuilderBooks.com, can help you better build and market homes to this age group.
Capitalize on the niches, needs and opportunities of this rapidly growing market by learning their preferences. To view or purchase this publication online, click here, or call 800-223-2665.
To learn more about the 2006 50+ Housing Symposium, which will be held April 24-26 in Phoenix, click here.
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