Neighborhood's owners up in arms
Developer accused of 'bait-and-switch' tactics
By Kevin Duffy - Staff
Article Courtesy of The Atlanta Journal-Constitution
Published: July 22, 2002

The homeowners thought they were buying into one type of subdivision only to discover a few years later that the developer's plans had changed. 

Instead of sticking to the subdivision's original design, the developer of The Glen at Eagle's Landing in Henry County decided to shrink lot sizes and increase the number of homes in the final building phase. 

The change has led to a homeowner revolt. White-stake signs dot front yards: "Eagle's Landing Planned Development NOT Going According to Plan." Huge letters on one garage door shout "Buyer Beware!" 

Tony Ingalls said he taped the warning on his garage in frustration after a meeting with the developer, Killearn Properties Inc. of Georgia. 

"They sell you a picture in the first phase. Subsequently they cut up the lots," said another homeowner, Skip Cerf. "It's a typical bait and switch, almost." 

Rebecca Callahan, who sold homes for the subdivision's first builder and bought one for herself, has reams of paperwork in her house to bolster her argument that Killearn doesn't deliver what it promises. 

"Don't set us up to believe one thing and then do another," Callahan said as she showed a page from the developer's Web site. It says Killearn homes typically increase in value because of natural amenities and high architectural standards. 

However, many Glen homeowners received reappraisals from the county last month indicating their three- and four-bedroom investments depreciated by $2,000. The appraisals are based on recent home sales in the subdivision. 

Residents blame Killearn, one of the giants of Southside development, for the lower appraisals, saying it has allowed smaller homes to be built after the first phase of construction five years ago. 

Killearn President David Williams contends that all houses in the Glen are similar and that the lower appraisals probably were due to the first builder pricing its homes higher. 

Christopher Burke, a government affairs representative for the Greater Atlanta Home Builders Association, said changing home styles and density in a partially built subdivision is "very rare. 

"That's huge. I'd be pretty upset if I was in that community," Burke said. "You've violated the trust of the community." 

The homeowners' battle with Killearn really began two years ago over plans for the subdivision's second phase. The builder changed, and residents were dissatisfied with the types of homes that were planned. But a compromise was reached and the expansion was completed. 

Same fight again 

Now, the developer finds itself in a similar tussle over plans for the subdivision's third phase. Killearn wants to allow 45 homes on the property's remaining 21.6 acres. Originally, it had proposed only 27 homes, but a swimming pool, playground and parking lot were moved, freeing space for more houses, Williams said. 

Cerf said in the new plan green space would become back yards, with tall trees replaced by saplings. And the new homes will be built closer to a railroad track than originally planned, making them less desirable because of the noise, he said. 

"I challenge you to stand 25 feet from this track when a train goes by," Cerf said. 

Because residents can't control new-home construction, they feel powerless. Killearn controls the subdivision's architectural committee and the property owners' association. 

"Homeowners have absolutely no --- and I mean zero --- recourse," said Cerf, who sits on the subdivision's architectural committee. 

Killearn argues the Glen was zoned residential without conditions in 1996, so it should be free to change lot and home sizes. 

But the county and the homeowners say the zoning was approved based on the subdivision master plan, which designated a certain number of homes. However, the audio recording of the commissioners' discussion back then is gone, so, "There are some unclear issues with this zoning," said Dale Hall, director of the county's Planning and Zoning Department. 

Master-plan tinkering is common and generally allowable as long as the changes aren't too significant, Hall said. But the changes at the Glen are considered significant, so last month the county Planning Commission reviewed Killearn's proposed changes. 

The commission didn't rule because the issue became so controversial. Instead, it forwarded the matter to the Board of Commissioners with a compromise recommendation that 36 homes be built. Commissioners are scheduled to discuss Killearn's plans next month. 

"It should be allowed to adjust reasonably," Hall said of the subdivision's design. "I think what the Planning Commission recommended was reasonable." 

But neither the developer nor the homeowners are happy with the compromise recommendation. Williams said he and the builder will try to negotiate with the homeowners but added that they are within their rights to build 45 homes instead of 27. "We are businessmen and we are in business to make a profit," he said. 

He's considering one alternative which would make the final phase a separate subdivision with 76 homes. The county is looking at that proposal. 

Commission has say 

But Cartersville attorney Frank Jenkins, an expert on local government law, zoning and land use, said the commissioners could have the power to make Killearn stick with its original design. 

"I think they would have the right to say, 'You made that bed, you're going to have to sleep in it,' " Jenkins said. He called Killearn's proposed changes "very unusual." 

The residents fear, for example, that the new builder, Majestic Residential, would build identical homes side-by-side or close to each other, unlike the rest of the subdivision. Homeowners also fear the homes would be split-foyer, a step down aesthetically. 

Williams said prohibiting the split-foyer design could be part of a compromise if homeowners are willing to talk. But how the homes are priced is up to the builder. "I can't regulate prices," Williams said. "I sell lots to builders." 

However, Killearn has close ties with Majestic. The builder's phone number rings at another Killearn subdivision, the Summit at Eagle's Landing. Killearn's attorney, Patrick Jaugstetter, is the registered agent for Majestic. Williams said Killearn helped Majestic get started last year but doesn't control the builder. 

Burke of the home builders association said if future homes are priced no higher than those built five years ago, that means "You're really talking about a much cheaper product." Homes prices at the Glen have ranged from $130,000 to more than $190,000. 

DeKalb County this month took steps to give citizens more power over subdivision design. Commissioners there approved a new ordinance that mandates a public hearing at the first step of a three-step plat approval process. A plat shows how land will be subdivided. 

A developer in DeKalb that wants to make changes late in the game has to go all the way back to square one, which is time-consuming and expensive. The intent is to prevent any unpleasant surprises for residents and to build neighborhoods rather than isolated subdivisions. 

Cerf said that kind of thinking hasn't made its way to Henry County. "There is no one in Henry County looking out for the homeowners," he said. 

Callahan, who sold homes for the subdivision's first builder, Centex, and bought one for herself, echoed his sentiments. 

"They own the county," she said referring to Killearn. "That is the problem. Henry County is a good-old-boy system." 

But Williams said poor communication is at the root of the controversy. 

"I learned a big lesson from this," he said. "We've got to be proactive in informing our homeowners in the future."