TND tide: traditional neighborhood developments work. But 20 years after their onset, the question is whether they remain a niche play or a major opportunity for builders.(house sales reacts to peevish countenance of potential buyer)

"LET ME GET THIS straight," a prospective home buyer says, his voice rising a notch, "you want me to pay more money for a smaller backyard and less square footage than I can get at any other community around here?"

Leslie Kennedy is prepared for the incredulous face opposite her information desk at Lakelands, a traditional neighborhood development, or TND, in Rockville, Md. She cuts short her usually comprehensive sales pitch when noting that the buyer's peevish countenance holds. "Look, this place isn't for you," she says. "There's a great community right across the street you should look at. In fact, there are tons of other homes in this zip code that would suit you much better."

Kennedy says her style gets a nervous laugh from builders and marketing specialists alike, but she shrugs it off, noting that TNDs are so different from conventional suburban developments (CSDs) that they require a completely different sales touch. Plus, she adds, "If a person isn't right for a TND, you don't want them to live in, it. They'll never be happy."

Kennedy also understands buyers' discomfiture. "They focus on the more-money-for-a-smaller-house deal, and they want to fight it," she notes. "They can't explain the TND concept in their own minds, let alone rationalize it to family and friends helping them house hunt."

This is the fundamental issue that's dogged the TND movement since the New Urbanist community Seaside swept onto Florida's shores in 1982: If you don't get it, you don't get it. Not only have buyers needed a crash course in the trade-offs of TNDs vs. conventional development, but builders themselves have been forced to swallow the iconoclastic premise that houses, like cars, can't be sold by the pound.

Buyer confusion has caused many builders to wonder whether building in TNDs is worth the steep learning curve and patience needed to succeed. They wonder whether the TND movement is simply another fad that will stay vertical, fringe, and complicated forever or whether it's a big opportunity for future growth.

TNDs, most simply described as compact, walkable, mixed-use neighborhoods, run the gamut from communities that ad-here rigorously to every TND tenet (there are 27 according to the Congress for the New Urbanism) to communities that hit the three major characteristics above but that are less strict about principles like architectural details or building materials.

SHALLOW OR DEEP?

The unfortunate reality, notes urban demographer Dowell Myers, is that comparable sales information for TNDs is almost nonexistent. "There is no source of data neatly labeled 'walkable neighborhoods, demand for,"' he says.

Builders interested in developing or building in TNDs, then, are forced to make a heroic leap when trying to determine actual demand. Generally, TND consultants and developers put demand at about 30 percent of the housing market, but advocates vehemently dispute that number as too low.

What we do know, according to New Urban News, is that more than 300 New Ur-

SHORE STORE: Like all TN Os, Seaside had to grapple with the issue of retail. In this case, the developer subsidized the corner store as the development was built street by street.

banist towns, villages, and neighborhoods are planned or under construction in the United States (not including 100 small-scale infill projects). Moreover, 46 of those projects contain significant, and often risky, retail components.

Myers, a professor at the University of Southern California, attempted to gauge future demand in his study, "Current Preferences and Future Demand for Denser Residential Environments." In the report, coauthored by student Elizabeth Gearin, Myers points to studies from organizations like the NAHB and Fannie Mae, which would throw cold water on TNDs. These studies claim that as many as 83 percent of consumers prefer a large single-family house in a low-density neighborhood.

TIDAL PREDICTIONS

So what's a business-minded builder doing swimming against the tide of folks who want product that's already being delivered seamlessly by the millions of square feet? A builder who's looking ahead, says Myers.

Myers' study revealed a small but substantial demand for an urban or town-residential style. It ranges from 17 percent to 33 percent depending on the report, he says. (At the same time, he believes that less than 83 percent of buyers prefer the stereotypical suburban house: In the same surveys, respondents who claim they want a suburban house also say they'd like stores and services within walking distance of their homes.)

Jeff Speck, a planner with Duany Plater-Zyberk (DPZ), thinks true demand is hidden by analyses of so-called best-selling homes: "Real estate industry advisors do market studies on …