After a 15-year lull, the Hudson Valley has once again become a hot market for new development. In this two-part series, we examine the current development boom and ask a host of developers and planners to share their perspectives on growth and their visions for the future.

To residents, the march of new development seems inexorable, with houses popping up everywhere. When locals catch wind of a 900-home project in Pine Plains or a 350-unit development in Kingston, we wonder how it will affect our landscape, traffic, and taxes. Who are the developers plying their trade in our backyards, and what are their intentions? Are they friend or foe? Are they sufficiently sensitive to the environment, the area's historic character, our need for affordable housing?

After extensive research, a picture emerges of a mixed bag of national and local companies operating in the region. Some are developing high-end, gated communities, a few are building with an eye to affordability, and still others are looking to find creative solutions, such as clustering and urban revitalization, to provide housing while maintaining open space. A few mixed-use projects are aimed at providing not only housing but also commercial space, including stores and restaurants and other outlets that would draw tourists. 

Whatever their ilk, the developers interviewed agree that the Hudson Valley is not an easy place to build. This is hardly south Florida, where tracts of woodland are transformed into massive blocks of condos overnight. Building houses in the Hudson Valley is anything but easy or quick. Developers face a limited amount of land, a patchwork of varying zoning codes, and strict environmental requirements. But the most formidable obstacle, they say, is community resistance, which stiffens with the disappearance of every farm and orchard. Many communities, encountering an onslaught of attention and interest from developers near and far, are pulling up their drawbridges and enacting moratoria on new construction.

"The biggest problem is that nobody wants growth," says Michael Perez, president of Hillside Homes & Development Corp., based in Newburgh. "Nobody wants change, but it is inevitable." Perez adds that it's easy for people to blame developers for the creeping sprawl, traffic congestion, and preponderance of expensive new homes, but the real fault is the lack of effective planning by town planning boards. "Everyone looks at the big bad developers, making millions, screwing up the land," laments Perez. But often a good plan gets thrown out, he says, because "planning board members don't understand that developers need to make money. If we're not synergizing, it's a win/loss."

Perez says many planning board members and town supervisors don't understand the nuances of land-use law and zoning. This misunderstanding leads to ill-founded suggestions to developers that undermine the economics of the project. A developer might then search for a loophole—such as 14-year-old zoning codes that are still on the books, and therefore legal—that allows for just the type of "cookie cutter" subdivision most towns want to avoid.

"The biggest problem is that nobody wants growth. But it is inevitable." -- Michael Perez Hillside Homes & Development Corp.

"Planning board members never consider the pure economics of the deal," complains Perez. "They should pay attention to this, because if they come up with something that doesn't make sense, it won't get done." For example, a developer might submit a plan for a clustered project that doesn't fit the town zoning, but leaves a lot of green space. Instead of spreading 40 units across 60 acres, he might want to cluster 45 units in a corner and leave the rest open space. What often happens, according to Perez, is that the planning board responds that 45 units is too dense and tells the developer to build 25 clustered units instead. But the developer can't make money without the higher density, so he scraps the plan and instead constructs a conventional sprawl-type development with houses scattered across the entire parcel.

Development Pressures
A number of factors are driving demand: the exorbitant cost of houses in Westchester County and other points south; a surge of empty nesters, as the first wave of baby boomers reaches retirement age and looks for smaller homes; the migration of service and office jobs north from New York City into Westchester County, which is bringing commuters to the Hudson Valley; rising real estate values, which are causing some locals to sell their homes at a hefty profit and trade up; and a growing population of telecommuters and weekenders.

Development pressure has happened before: Dennis Doyle, director of the Ulster County Planning Board, notes that the pattern is cyclical, with the last booms occurring in the late 1970s and late 1980s. What distinguishes the current flurry of activity, he says, is three factors: lack of development opportunities to the south ("the larger, more sophisticated developers are being pressured to look elsewhere because of the lack of availability" in the suburban New York City area); the shift from manufacturing to a "more knowledge-based" economy, which is enabling more people to move out of the corporate office and work where they like; and the appeal of real estate as a desirable investment, spurred by low interest rates.

Dave Church, commissioner of planning for Orange County, adds that development "was dominated by family-owned operators until this latest boom." Nowadays, large national players, like Toll Brothers and WCI Companies, want a piece of the action. Furthermore, while in the 1960s and late 1980s a lot of development was "speculative" and never materialized, "now it gets built. People are seeing houses put up so fast they're pressuring officials to bring in newer zoning codes. That's never happened before."