Douglas Yearley : Sure. Paul. Happy to do that. Interestingly, and it’s the first time in some time, the East is better than the West in sales. We’ve talked about Smile States and everybody moving south and everybody moving west. And it’s simply because at West, prices went up a lot more through COVID. And so you have markets like Boise and Phoenix as two examples out West and the Nevada markets of Reno and Vegas as examples where we had communities where prices were up over 40% through COVID and notwithstanding the long-term positive prospects for those markets because of affordability, job growth, sunshine, lifestyle, they as always happens in these cycles, the faster you go up the first you are to come down. And so the Western markets are softer.
They have been slower. We have bigger backlogs out West because we were so hot out there through COVID. And so we’re being a bit more protective of that backlog and a bit more careful to not chase those markets down lower which is necessary because of the inelasticity. So places like New Jersey, Philadelphia, Atlanta, Massachusetts, Michigan, Virginia and all of Florida right now are our best performers. In terms of market segments, the active adult empty nester, which it’s not just 55 and over, it’s the boomers that are moving down. That has been our best segment for good reasons. They pay more cash. They’re less impacted by rates because they have a lot more equity in the home they raise the kids in that they’ve owned for 20 or 30 years, and they’re more affluent and they’re willing to put either all or a lot more cash up and have lower mortgages — the softest — and the other three segments, which — there are two segments, which would be affordable luxury and move-up luxury are running about the same and City Living is doing the best, which is right now, New York only.
We have two buildings, one in Manhattan and one in Jersey City that are crushing it.
Martin Connor : They’re all in JV.
Douglas Yearley : They’re all in JV that’s going to come into the other income line, but we sold 80 units in Jersey City in six months at $1 million plus a unit. And we’re about to open on the Upper West side of Manhattan with what we think is significant pent-up demand. So I haven’t said that in a long time, but the City Living segment is doing very, very well, but it’s very small and again, in joint venture.
Paul Przybylski: Okay. I think over the — let’s call it, the past 12 to 18 months, maybe even a little bit longer, you probably entered maybe a half a dozen new markets. Can you maybe give us some color on where those stand? And are you still committed to those markets, given the new environment and the likelihood you haven’t achieved a scale yet.
Douglas Yearley : Sure. So we had in three markets in South Carolina, Charleston, Myrtle Beach and Greenville through the acquisition of 1 builder down there, it’s fantastic. And those markets are doing very well. They’re part of this Smile States, when we talked about Smile Sates and now they’re part of the East as we talk about the East. So we’re very, very happy with that acquisition. We had a very small acquisition in San Antonio. We have a great presence in Texas. We’ve previously been in San Antonio. We actually have land in San Antonio for our own account when we acquired that builder. That’s a small market, and we’re just beginning to integrate there, I’d say it’s too early to say. But generally, Texas is doing just fine.
What else more recent guys? Well, that’s a new market. So Spokane, Coeur D Alene, which was not a builder acquisition, but it was a new market on the Eastern side of the State of Washington. And of course, Coeur D Alene is in Idaho, but it’s right down the road from Spokane. That’s had a very slow start. We just entered Long Island. And at $3 million, $4 million, we’re doing really well. That’s — and we opened four months ago, not great timing, but we actually have really good sales. Nashville is a new market, just too early to tell. We have a couple of urban buildings, not high rise, but midrise and we haven’t even opened our first suburban building. So that will take a little bit of time. Tampa opened maybe three years ago, terrific sales — we’re having some production issues there that we’re working through.
But long term, I think we’re very pleased with being in Tampa and Marty put it on the board for me, and that rounds it out.
Operator: Our next question comes from Mike Dahl from RBC Capital Markets.
Michael Dahl : Doug, just following up on Alan’s question and Steve’s earlier around just the strategy of how you evaluate the spring and not mean sense to kind of push on a string in December. I guess any more quantification for what’s kind of the trigger point on a pace basis where you just say, hey, this isn’t working in the spring because the back half of your fiscal year, you ran about a 1.2 a month. So is it — if you just flatline at 1.2, been, hey, like we’ve got to drive back towards 2 or whatever the number is? Or maybe just a little elaboration on metrics that you’re going to be looking for and what’s acceptable?
Douglas Yearley : Sure. So there’s not one metric. We don’t have a sales quota. We’ve never run this company top down — top line down but we’re very mindful of the need if we get to that point of driving more sales. And I’m sorry for the vague answer, but that means that we analyze every community locally. We start having meetings with the sales team, with the community team. We do a deep dive into the market comps and we start making pricing decisions accordingly. We also may have some modest shift in product offering. Maybe you come in with a smaller house. Maybe you come in with the same house, but you pull some features out of it. There’s a lot of different moves that we make. It’s studied weekly, but it’s studied very, very locally.
So I can’t tell you that if we sit at 1, 2 sales per month and really want to be at 2, we’re going to start making some dramatic company-wide moves. It’s going to continue to be market and community specific, and we will act accordingly as we roll through the spring season.
