The real estate downturn hasn’t killed Home-Aid Orange County’s development pipeline.
While most builders would be eyeing hefty profits in this situation, HomeAid is in the business of charity.
Irvine-based HomeAid OC, the nonprofit arm of the 1,000-member Building Industry Association of Orange County, is contracted by charities to build housing and shelter for homeless people and families and others in need.
It taps local building executives to lead the projects, which are known for being well made and under budget.
Newport Beach-based William Lyon Homes Inc., Walnut-based J.F. Shea Co.’s Shea Homes and Miami-based Lennar Corp. have all donated time and people to lead projects.
“The building community doesn’t know about taking care of the homeless, but we know about building,” said Mike Schlesinger, HomeAid board member and vice president for Miami-based LNR Property Corp., which has its commercial property group based in Newport Beach.
The homebuilders turn to their network of member subcontractors, architects, landscapers, engineers and others for donated labor and goods. On any single project, hundreds of businesses lend time or donate items from construction materials to kitchen appliances.
Every project’s goal is to build without debt, said Scott Larson, executive director of Home-Aid OC. That way, the charity’s income can be used for its cause rather than paying off a debt.
“That’s what your donors want to see,” said Theresa Murphy, chief executive of Precious Life Shelter Inc., which has worked with HomeAid to expand its operations. “They want to see the programs being funded, not buildings.”
Tough Times
Tough times for the building industry make it more difficult to find homebuilders with staff to spare, as many have pared down their workforce.
“Right now, it’s difficult to come up with builder captains,” said HomeAid board member Richard Hunsaker, chairman of Irvine-based Hunsaker & Associates, an engineering company. “It’s tough for them to justify doing it. The industry is still pretty slow.”
But that doesn’t mean it’s impossible.
“A lot of them see this as the bright spot,” Lar-son said.
HomeAid is in a good position to wait out the downturn. It recently finished four projects and now is in predevelopment on a couple, and it’s looking for new projects and reviewing some proposals. By the time it’s ready to build, the industry should be on its feet.
HomeAid is working on smaller projects, in-cluding remodels in Laguna Beach and another in Lake Forest.
It has built housing for many OC charities, including Tustin-based Orange County Rescue Mission, Grace House in Santa Ana, Laura’s House in Ladera Ranch and Anchor House in San Clemente. It has done 44 projects in all.
For each project, HomeAid tries to call on a different builder.
“They all try to outdo each other,” Murphy said.
The homebuilder’s reputation is at stake, Larson said.
HomeAid finds its projects by being active in the community. Larson serves on the Orange County Housing Commission, which is in the process of drawing up a 10 year plan to address homelessness.
Sometimes projects will come to him.
Another project involved the city of Buena Park, which approached him a few years ago.
“Buena Park recognized they had a lot of issues with older motels (that were) used as a form of affordable housing,” Larson said.
HomeAid scouted for land and enlisted John Laing Homes to build 17 row townhomes, which opened as Hope Family Housing in 2008.
The homebuilder donated a dedicated project manager to the project for 18 months.
“As a builder captain, you want to put your best foot forward,” said HomeAid treasurer Dave Prolo, a principal of Costa Mesa-based DK Chappell Inc. who at the time worked for John Laing Homes, which filed for bankruptcy protection earlier this year.
Hope Family Housing, a $5.5 million project, was built for half of that.
Good Looking
In addition to being a pride issue for the builder, having a nice looking building helps the nonprofit get community support. In Santa Ana, HomeAid, Mercy House and the city were able to rally the community to support the Emmanuel House for men and women with HIV/AIDS. The house opened in 2001.
“Ultimately, it was viewed as an asset in the community versus a liability,” Larson said. “We’ve transformed empty lots and old lots into beautiful buildings.”
An aesthetically pleasing environment also helps the charity serve its people. People feel better about themselves if their physical environment is beautiful, Larson said.
HomeAid was founded 20 years ago after the Building Industry Association did a pilot project with then Irvine Temporary Housing, now Irvine-based Families Forward. The homebuild-ers renovated two farmhouses donated by the city of Irvine on land donated by Irvine Company.
HomeAid OC has spawned 22 national chapters in 16 states, including HomeAid Atlanta and HomeAid Michigan, but it kept its national headquarters here in Newport Beach. National chapters are tied to their local Building Industry Association chapter.
HomeAid works with an annual budget of $600,000 for payroll, rent and other expenses. Each project has its own budget.
HomeAid writes grants and gets contributions from private, state and federal sources, although it tries to rely mostly on private funding.
“One of the things we’ve done is to be really fiscally conservative,” board member Schle-singer said. “We run our operation with a lean, flexible and talented staff. Everybody pitches in and wears a lot of hats.”
The organization’s annual fundraiser,Project Playhouse,is in its 18th year and raises the bulk of HomeAid’s income. And, unlike HomeAid, it’s well known in OC.
Every year playhouses, built by HomeAid builders, are auctioned off for as much as $70,000.
HomeAid doesn’t only help by building. HomeAid also has a charity, Essentials for Young Lives, which collects diapers, baby wipes, formula and other items for homeless infants and toddlers.
