JON Properties believes that premium locations deserve premium housing developments.
By Tim O’Connor
Watching as a plot of dirt turns into a lasting part of a community is Mike Adams’ favorite part of being a developer. “There’s something that will be here long after I’m gone and lived in and worked in for generations,” the president and founder of Virginia’s JON Properties says. “In this line of work, you really do get to see things come to a conclusion.”
It was 2006 when Adams sold his interest in a heavy equipment dealership and used the money to start JON Properties and purchase a small portfolio of flexible warehouse properties. The Great Recession would hit a year later, making it a difficult time to kick off a property development business. JON Properties, which takes its names from the initials of Adams’ children, survived by making land deals at a favorable price and diversifying its projects to include surgery centers and doctor’s offices. From there, the company expanded into residential projects.
“Being diversified like that really keeps us in the sweet spot where we don’t have to chase work or do things that don’t make sense,” Adams says. The company builds in the region around Fredericksburg, Va., a city 45 minutes south of Washington, D.C., known for its connections to American history and as a battle site during the Civil War.
JON Properties is a licensed Class A contractor, allowing it to not only develop properties but also to act as its own general contractor. The development process starts with finding a site and securing financing. JON Properties has its own realtor’s license so it can market projects to potential homebuyers in-house. “What makes us unique is we can take a project from dirt all the way to delivering a finished project to the end-user,” Adams says.
Controlling the entire process results in lower costs to the buyer or lessee without sacrificing quality. “It really gives us an advantage because on a typical project there might be four different levels of markup,” Adams adds. That’s an especially important edge when building and selling townhomes and condominiums on the higher end of the local market. In 2016, JON Properties designed, built and delivered the highest sale in the entire region when it sold one of the two 3,500-square-foot units in its Park View project for $1.62 million.
Park View is the company’s most luxurious residential development project to date. The project, located in downtown Fredricksburg, is a four-story, mixed-use building with a bank on the first floor and four condo units. The two 3,500-square-foot units include an additional 1,000-square-foot of outdoor terraces, all with grills outdoor fireplaces and private elevator access. Units also feature 9-foot ceilings, heated floors and extensive sound insulation. A multi-tier security system limits entry into the building and allows residents to buzz in guests from their mobile devices.
Before Park View was completed in November, Adams says there was no comparable building in the entire Fredricksburg market. “We’ve introduced a high-end condominium product to the city,” he boasts.
Two of the Park View units have already sold, proving there is a market for high-end luxury in Fredricksburg. JON Properties wants to build on that success with more projects in the same mold. In March, the company broke ground on five brownstones along George Street in the city’s historic district. They will be priced between $1.2 million and $3 million. Three of the George Street units have already been presold.
Adams credits the company’s ability to find desirable sites with enabling the high-end market to thrive. “We look for really great locations above and beyond anything else,” he says. “A great location demands a superior product.”
A desirable location is a good start to a project, but a developer and contractor needs subcontractors it can rely on to see it through. “We tend to work with many of the same contractors from job to job,” Adams says. “That works well because they know us and we know how they work. They’re going to deliver a quality project on time and on budget.”
Great design is another important factor in delivering on the quality JON Properties seeks. The company enlisted BOB Architecture of Richmond, Va., for Park View and nbj Architecture of Glen Allen, Va., for the George Street Brownstones. “I work closely with them on the design of the project to set the tone and vision and they bring it to life,” Adams says.
Being able to give full attention to each project is important to Adams. JON Properties typically only undertakes two to three developments at a time, a comfortable workload that allows the company to keep a lean workforce. “That’s the trap of this business, that people get so big they have to feed the machine and they lose sight of what made them good in the first place,” he says.
As a result, JON Properties is selective about which developments it moves forward on. “We really look at each project on a standalone basis and if it makes sense and meets our criteria we move forward with it,” Adams says. “For every one project we do there’s 10 we don’t do because all those factors don’t come together.”