Whenever recycling comes up, people usually talk about paper or metals such as steel or aluminum. But ask Steve Jordan about it, and he will talk about residential and commercial property.
In fact, that is the basis for his company, ReBuilding America Inc. In the past 10 years, the company has recycled more than 6,000 homes in San Diego County, including its headquarters in Oceanside.
The firm’s old Lawrence house was built in 1908 and was moved to its present location on Pier View Way last year. The house was restored and now sits a short distance from many other properties the company has recycled in the downtown Oceanside area.
The idea to recycle homes came about after Jordan and his fellow owners sold their scrap business in 1983. After 20 years in the industry he agreed not to form a business or work for a competing firm, he said.
“It came to me very clearly that one and probably the most important item that we have that is not recycled in America effectively is housing. And so I started developing processes and technology to recycle real estate,” he said.
Jordan formed Dirty Work Construction Inc., which is where the techniques and foundation was laid for ReBuilding America. Dirty Work exists in name only and the company’s former employees are now contractors who are hired to recycle properties.
In 1998, SCJ Inc. was formed, and that evolved into ReBuilding America in 1999.
– Scrap System Applied
To Rebuilding Properties
A system has been established to rebuild residential and commercial property that is similar to techniques he used to recycle other products in the scrap business.
ReBuilding America has the ability to perform all the necessary functions to recycle a property in-house. ReBuilding has departments to buy properties (usually in cash), handle construction, design, permits, property management and other tasks.
The day escrow closes on a property, ReBuilding crews are at the site to transform the building, Jordan said.
So far, competition mostly consists of mom-and-pop operations, although he believes that real estate recycling will become a huge industry in the next 10 years.
According to Jordan, it is cheaper to fix a property than it is to build a new one.
– Remodeling Often Less
Expensive Than Building
A builder can pay $125,000 or more per unit after land costs, impact fees and construction expenses for an apartment complex, he said.
At that price, it is economically unfeasible for a builder to charge anything less than $1,000 for rent, he said. In addition, it could take six months to a year to actually construct the facilities.
ReBuilding, on the other hand, could spend about $80,000 per unit to essentially remodel the complex in about a month, he said. At this cost, the owner can charge a few hundred dollars less in rent.
“The apartment unit has the same features as a new apartment when it’s finished,” said Jordan, who grew up helping his father, a remodeling contractor in Colorado Springs, Colo.
The greatest thing his father taught him was to “look at buildings not as they are, but as they can be,” he said.
Because housing is so expensive and vacancy rates are low, Jordan believes that recycling residential and commercial properties will be essential to accommodate future housing needs.
The county’s population is expected to approach 3 million this year, according to the Web site for the Greater San Diego Chamber of Commerce.
– Recycled Homes
Help Fill Demand
Although the chamber approximates that 24,000 housing units will be needed to accommodate the population increase, only 15,000 new units are expected to be added this year.
Noting figures like these, Jordan said that home prices will continue to rise and trap people in a Catch-22.
“Affordable housing is not being built, nor can it be built in Southern California,” he said.
“Essentially what is happening is that a working person is finding himself in a position where he can’t afford to rent and he can’t afford to buy.
“I don’t know what all the solutions are, but I do know that part of the solution is recycling or rebuilding our present inventory.”
Driving around downtown Oceanside, Jordan points out several properties that have been recycled, including some that are 50 to 100 years old.
Oceanside Mayor Dick Lyon called the renovated residences “little points of light.” ReBuilding’s work and the city’s redevelopment efforts have gradually changed the area.
“What he is doing in the downtown area is nothing short of incredible,” he said, adding the homes have escalated in value.
Depending on whether a property has been upgraded, recycled properties may have new kitchens, bathrooms, roofs and landscaping. When ReBuilding finishes a property, future tenants or owners will have a like-new home.
– Old Homes Raised
To Modern Standards
The company aims to bring older residences up to par with newer homes. About 60 percent of housing in the county is 30 years old or older and most has not been rebuilt or updated to meet today’s standards, he said.
It causes older homes to fall out of favor with buyers.
“When Mr. and Mrs. America go house shopping, they may look at the present stock. And then they go to a new home subdivision and they say, ‘That’s what I want.'”
The company has more than $14 million worth of inventory in all stages of renovation, Jordan said. ReBuilding’s real estate department is also continually seeking properties, especially in the North County.