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MHB-Developers

Orren Pickell Building Group

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In his 38 years of working in the custom homebuilding industry, Orren Pickell has seen his share of housing ups and downs, which gives him a working knowledge of when a down market is starting to look up. 

“The market is getting much better,” says the president and CEO of Orren Pickell Building Group. “We are currently designing eight very large homes on the boards right now and that’s different from the recent past in two ways. One is having that many projects in design at one time but also the fact they are larger. These are a million-and-a-half-dollar homes as opposed to what we were doing, which are homes in the $700,000 to $800,000 range. Now everything is back to a million-and-a-half and above again, which is nice for us since that is our strong point.” 

The current residential market is still a stretch from its 2006 heyday, but Pickell says that his August 2013 numbers were up 25 percent versus August 2012, signaling the start of a return to market normalcy. And just like in past economic recoveries, Pickell says this recovery is traveling similar geography. Orren Pickell Building Group is a design/builder of custom homes, and has custom cabinetry, vacation home and maintenance divisions. Its work focuses on Illinois, Wisconsin, Michigan and Indiana. 

“The North Shore of Chicago is probably doing the best,” Pickell says. “We still are working in Wisconsin and have a project about to start in Michigan and another that is fully designed and ready to go in Indiana, but I would say the North Shore and the closer you are to the city of Chicago, the sooner you came out of this recession. That’s also how I’ve seen it happen in past recessions.” 

Pricing Pushback 

Although the return of large custom homes is a good sign for the homebuilding industry, Pickell notes that the lagging market of the past six or seven years has taken its toll on companies in the industry, causing many to shrink their operations or shut down. The result is increased pricing for labor and materials. 

“If housing increases too rapidly, it will be difficult because the experienced people have left the industry,” Pickell says. “Where did all the lumber mills go and are those easy to reopen? Things like concrete and drywall have commercial and industrial uses all over the world, but things like lumber, shingles, roofing, carpentry and framing – those things are tied to residential housing. 

“But one thing we pride ourselves on is always attaching a budget to each design,” Pickell continues. “If the client requests something, we budget for it. But right now we are hitting the higher ends of those budgets because of the pricing pressure in the market.” 

With the cost of homebuilding in a bit of flux, Pickell says luxury homeowners are still building with an eye to practicality. Quarterly rooms are being nixed from plans and green and sustainable elements are only used where there is a definite payback over time. Footprints are also getting smaller or what some have dubbed “right-sized.” Pickell says clients today are interested in getting the most out of their luxury living spaces. 

“Most people building today would’ve built bigger in the past, but they are not compromising on what’s necessary for their individual lifestyles,” Pickell says. “Quarterly rooms or dining rooms are only used a couple of times a year so clients are gravitating toward designing homes where they use 100 percent of the house on a weekly basis. We make sure that we can say ‘yes’ at any point in time to any of those requests made by our clients and give them the house they are expecting.”