Modus bets the house on new construction

In the middle of the real-estate downturn, Steven Hanson wasn’t looking for foreclosures and short sales.
What he sought were over-corrected prices in the most desirable waterfront locations.

“If a parcel should have been $3.5 million and, now, less than a year later, it becomes available for $2.5 million or $2.6 million, it’s the kind of thing that makes you scratch your head and say, ‘That doesn’t feel right,’” Hanson said. “It’s too much of an over correction. That’s when your business brain goes into gear.”

The 39-year-old Liverpool, England, native is the president of Modus Operandi Partners LP and Modus Construction LLC and hopes to vault his company to the top of the list of Gulf Coast luxury homebuilders. How? By developing upscale, single-family homes with a focus on mid- to south-Longboat Key, Lido Key, Siesta Key, Casey Key, Boca Grande and Anna Maria Island.

Currently, he has seven projects in various stages of the construction process. Some still have yet to break ground, while others like the home at 1435 Westway Drive on Lido Key are ready for staging. Hanson’s companies bought all seven sites during the last 18 to 24 months.

The demand for new construction on waterfront land is always there, said Hanson, who cites the example of Bird Key, where 14 new homes have been planned or permitted in the past 18 months.

“The best analogy is that you might get a used car,” Hanson said, “and it gets you from point A to point B.”
“Then, go sit in a new car, and feel the difference,” he says. “It takes getting a new one to realize how old it was.”

Hanson’s first venture in local real estate came in mid-2008 with a two-unit duplex that he bought for $375,000 out of foreclosure on Holmes Beach.

A former equities trader, he left the stress of 12-hour days in London behind in 2003 and lived for three years in South Africa, where he opened an art gallery.

He moved to Florida after his father, Graham Hanson, head of the U.K. chicken distribution business, SFC (Wholesale) Ltd., started investing in rental housing on Bradenton Beach with Shawn Kaleta of Beach to Bay Construction Inc.

Hanson gutted the Holmes Beach duplex and divided it into three units that he rented out for two years before selling them in 2010 to other investors for a total of $1.19 million.

He estimates that he repeated the pattern more than 50 times before selling his rental inventories to focus on bigger projects and bigger opportunities.

Hanson believes people will pay for perceived value.

For buyers at the high end, that means open-water views, the latest technological features and custom-built furniture.

Hanson decribes the style as modern, light and spacious — a contrast to the many Mediterranean-style mansions built locally in recent decades.

One thing the company’s portfolio doesn’t have: a Longboat Key residence.

Although the company’s office is located at 444 Gulf of Mexico Drive, near its latest Westway Drive projects, it has yet to build on Longboat Key.

Hanson said he would like to build on the island if the right parcel became available. He believes the state of Whitney Beach Plaza has hurt the north end, so any parcel he would consider would probably be located mid- to south-Key.

Hanson said building on Longboat Key would be more of a risk than Lido Key or Siesta Key. He’s concerned about the town’s ban on weekly rentals, which he says has hurt commercial businesses — a contrast to Anna Maria Island, which he describes as “flourishing.”

“Longboat needs to reinvent or die,” he said.

Home run
Modus Custom Homes is approximately three weeks away from finishing construction on the home at 1435 Westway Drive.

The 5,759-square-foot home has five bedrooms, six bathrooms, two half-baths, 80 feet of frontage on New Pass and a 47-foot heated pool.

It has a round reading room with a waterfront view. In the past, a buyer might have chosen to use the space for a home movie theater, according to Hanson, although many of today’s buyers have realized they can get the same effects with a large high-definition TV. Today, buyers are more likely to use the space as a wellness spa, gym or Pilates studio.

The home’s best features:

“The key thing for the gentleman is going to be your outdoor kitchen and pool,” Hanson said. “For the lady, it’s the kitchen and master bathroom.”

The home is listed for $6.5 million by Stephanie Church, of Michael Saunders & Co.

Hanson’s company purchased the vacant parcel, along with the adjacent parcel, for $2.6 million in August 2010. He plans to build another home on the neighboring parcel.