Italianate Magic

If you sell houses from a furnished model home, you've probably spent countless hours trying to come up with a memory point that will separate yours from all the other model homes shoppers see before they narrow their choices. (Even a great house plan needs that special something to stir recall.) Here's a memory maker that we think is terrific, in a house that's spectacular.
By Bill Lurz, Senior Editor | August 31, 2005

Vital Stats

If you sell houses from a furnished model home, you've probably spent countless hours trying to come up with a memory point that will separate yours from all the other model homes shoppers see before they narrow their choices. (Even a great house plan needs that special something to stir recall.) Here's a memory maker that we think is terrific, in a house that's spectacular.


In February, 2003, Pete McNabb, an Arthur Rutenberg Homes franchise holder in southwest Florida, was in the midst of concept planning for the largest and most expensive model home he has ever built. The 7300-square foot Bellagio II (shown here) would have to be completed by mid-November, 2004, in time for the annual Tour of Homes at Lakewood Ranch, a 5200-acre master-planned community that dominates the housing market in Florida's Manatee and Sarasota Counties. During a session with Rutenberg's director of design, Mario Vitorino, McNabb came up with this brainstorm:

"We were looking at the plan in the area of the storage and utility rooms on the secondary bedroom wing of the first floor, thinking about converting the storage area into a 'wine cellar,'" McNabb recalls, "and the problem, of course, is that Florida houses don't have 'cellars' of any kind. But then, I had an idea.

"Why not put an elevator in the space between the wine cellar and the hallway? It would run between the first and second floors. But if the elevator had doors opening in both directions, couldn't we disguise it so the trip from the first floor to the 'wine cellar' takes the same amount of time as the trip from the first floor to the second? If so, we could fool guests into thinking they were going down to a subterranean level. That would certainly be a memory point. It's the kind of thing Disney does all the time. When it stopped 'moving,' we'd open the back door of the elevator, and guests would step out into a cedar-paneled wine 'cellar' with fake beams overhead that make it seem like you're 10 feet underground — even though, in reality, you're only inches below the first floor, in a room that runs back under the circular staircase." (A door into the utility room is hidden in the paneled wall.)

At the time of this discussion, Inclinator of America elevator sales representative Mark Crispen happened to be in the Arthur Rutenberg Homes headquarters building in Clearwater, Florida, meeting with Rutenberg's director of architecture Tom Kruempelstaedter, AIA. "I pulled him into the meeting with Pete McNabb," Kruempelstaedter recalls, "and he assured us that it could be done with hydraulics — so the trip from the first floor to the wine cellar takes the same time and feels just like the trip to the second floor."

If you visit the $5.25 million Bellagio II model at Lakewood Ranch Country Club today, you can take that elevator ride, just as 10,000 other visitors have since the model opened on November 1, 2004. This model home — with its fascinating memory point — has contributed more than any other to a transformation of the Arthur Rutenberg franchise network throughout Florida.

A New Arthur Rutenberg

"In 2005, our revenues are running 127 percent ahead of last year," says Rutenberg COO David Hanrahan, "mostly because our franchisees are moving to much higher prices. In the first half of 2005, we've sold 582 homes — averaging $740,000 in price. And 98 of those homes have been priced above $1 million, eight above $2 million."

In all of 2004, the Florida franchise network sold 892 homes at an average price of $600,000 (and closed 603 for $338 million, good for No.78 in PB's 2005 Giants rankings). "We only sold 66 homes priced above $1 million in 2004, and four above $2 million," says Hanrahan. "But even so, our revenues were up 151 percent over 2003. So this process has been going on for a while, and is being driven by demand. But the Bellagio II model at Lakewood Ranch contributes to it in a major way.

"We have franchisees all over the state who are sending prospects to Lakewood Ranch to see it because —more than any other model we have ever built — it proves we're comfortable building big homes priced above a million dollars," Hanrahan explains. "At 7300 square feet, with a price tag of $5.25 million, the Bellagio II doesn't leave much room for doubt."

Tessa Madasz, Rutenberg's director of sales and marketing, says the Bellagio II has been a hit from the day it opened — for Pete McNabb, and for other franchisees: "We had 4500 people through in two weeks during the Lakewood Ranch Tour of Homes," she says. "Now, on average, Pete McNabb's sales reps see one to three customers a week sent by franchisees in other parts of Florida. Since November, we've sold four Bellagio II plans and 21 other plans of over 5000 square feet. In the nine months prior to opening that model, we had sold only one Bellagio II and four houses of over 5000 square feet."


Unfortunately for Pete McNabb, none of those sales have come at Lakewood Ranch Country Club — because the ranch is out of estate lots in the club!

"We've sold two of that plan through our franchise in Sarasota County," McNabb says. (He owns four Rutenberg franchises.) "It's also opened doors for us with developers who have asked us to build in other high-end communities. We've sold four Bellagios, but Lakewood Ranch ran out of lots in the country club about the time this model opened."

It wasn't supposed to be like that, says Robert Veltri, president of McNabb's Manatee County company. "La Cantera (44 estate lots) is the final phase of this country club," he says. "It was supposed to come on stream in January, but now they say it will be October."

That will complete the 2391 single-family home sites in Lakewood Ranch Country Club. By the summer of 2006, Lakewood Ranch plans to open sale of lots to builders in Country Club East — a second golf community with 2200 home sites. Demand is so great that Lakewood Ranch plans to begin home construction in the new club before the golf course is built. "The new club will have reciprocity with the existing club," says Sondra Guffey, director of media and communications for Lakewood Ranch, "so those home owners will have golfing privileges while their course is under construction."

Even with the prospect that the logjam will soon be broken, McNabb is carrying the expensive model without the opportunity to sell this plan in the community where it is built. To overcome that limitation, the Manatee County franchise Veltri heads has spread out. It's now building in several other high-end communities. "We just bought 40 of the 62 lots in Winding River, a community on the Manatee River," Veltri says. "We're also going into Riviera Dunes, on the north side of the river in Palmetto."

Other Bellagio II Attractions

Look at the floor plan on and you'll see that Pete McNabb and the Rutenberg design team did not put the brakes on their creativity with just the wine cellar and elevator. They converted what could be a fifth bedroom into a first floor "wellness center" just across the hall from the elevator, McNabb says: "People in this price range love those little extra touches of class — like the exercise room with its own elevated massage table and a full bath."

However, McNabb is probably more excited about the impact of Bellagio II's upstairs game room. "We now get requests from buyers to incorporate elements of this house into other plans," he says. "Many people will decide that they don't want a house as large as Bellagio II, but they will ask us to incorporate the master bath and garden or some other element into one of our smaller plans. The upstairs game room, with its open media center, is what they seem to want most.

"We've already put a version of that second floor onto three different houses we have under construction. It's such a great entertainment space," McNabb says.

Downstairs, the living room — with its ceiling soaring to 24 feet — combines with the wet bar, morning room, kitchen, leisure room and covered lanai to form a massive entertaining area.

Upgraded Specs Sell Sizzle

Rutenberg franchisees outfit homes with three different series of specs — 1000, 2000 or 3000 — depending on price point. With so many franchises now building homes priced in excess of $1 million, the 3000 series is getting a workout.

"We've flexed up our specs even from the 3000 series level," says Veltri. "For instance, the cabinets in the Bellagio II are Wood-Mode line, which is above even what the 3000 series calls for.

"We have G.E. Monogram appliances, which is the Rutenberg 3000 spec, but that's also because Lakewood Ranch is a G.E. community," Veltri says.

McNabb chooses Kohler and Moen plumbing fixtures, hardwood flooring by Mannington, Alpha and Dal tile floors, granite countertops and extensive use of pre-cast stonework throughout the home to dress up the Bellagio II. "The windows are all impact-resistant Pella products, with the exception of the 90-degree sliding glass doors, in the leisure room facing the lanai, which are by Windoor," says Kruempelstaedter.


Veltri has the Bellagio II model on the market for $5.25 million, including all the furnishings. The goal is to sell it and lease it back — so the home can continue to work its marketing magic as a model for another six to 18 months. "We almost sold it four months ago. A group of investors was looking at it. Once we have our model open this month in Highfield (another high-end golf community), we'll have the flexibility to sell without a lease-back if we need to do that. If somebody wants it fast, they can have it in two months."

Veltri also plans to build a new model in La Cantera. Meanwhile, the high-end market is broadening throughout Manatee and Sarasota Counties. "There's so much demand," Veltri says, "It used to be that million-dollar homes were just on the water. But now we have people moving off the water to get into exclusive golf club communities. Right now, that's happening at The Founders Club in Sarasota, and The Concession is coming on stream in Manatee (with a golf course designed by Jack Nicklaus and Tony Jacklin).

"We're now averaging over $1 million in price on the houses we pre-sell. I've got people lining up to buy Bellagios," Veltri says. "The problem is finding a lot, and, of course, most of the people who visit the model want to live in Lakewood Ranch, not somewhere else."

The good news is that the growth forced on the franchise by a shortage of lots will eventually pay dividends. "I now face the necessity of doubling the size of my team," Veltri says. "We may only build 15 houses this year, but our revenue will be over $20 million, and the pent-up demand is tremendous. We will soon be able to deliver houses in Winding River, Riviera Dunes and Highfield, as well as La Cantera and, in 2007, the new Country Club East in Lakewood Ranch."

McNabb builds the base Bellagio II for hard costs (materials and labor) of $257 a square foot. As modeled, the high-spec version costs $390.59 a square foot. The 125- × 200-foot lot the Bellagio II stands on cost McNabb $350,000 and is now worth $500,000.


Vital Stats

Builder: Arthur Rutenberg Homes (Pete McNabb, Bradenton, Florida)

Developer: Schroeder-Manatee Ranch

Community: Lakewood Ranch Country Club

Architecture: In-house (Tom Kruempelstaedter, Mario Vitorino)

Interior Merchandiser: In-house (Cindy Alander)

Model open: November 1, 2004

Sales: 4 (this plan, all franchises)

Square footage: 7300

Lot size: 125 × 200 feet

Serviced lot cost: $350,000

Selling price: $5.25 million (furnished)

Hard costs (materials, labor only): $390.59 per square foot (as modeled)