Wellington faces challenge of older home stock as new communities grow

With little new housing stock and few one- or two-bedroom units, Wellington is looking for ways to stay relevant to the young families it hopes to attract — especially as new communities including Arden and Westlake nip at Wellington’s family-friendly heels.

It’s that family-friendly aspect combined with a unique, thriving local economy that keeps Wellington in the game when it comes to attracting residents, a team of Florida International University researchers told the village council and staff at a May 4 workshop.

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The FIU study is the culmination of months of work looking into Wellington’s economy and housing market, as well as the economic impact of the equestrian community.

Ned Murray, associate director of FIU’s Metropolitan Center, said understanding Wellington’s housing market is key to understanding where the village sits “as a competitive community within the larger market.”

“We want to be able to maintain Wellington’s character,” Murray said. “Wellington has a brand, Wellington has a character that’s just unmatched with any other community that we know of in South Florida.”

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But while Wellington’s brand is unique, it faces several challenges in Palm Beach County’s bustling housing market, including a shortage of smaller homes. About 19 percent of Wellington housing units have one or two bedrooms, compared to 50 percent of Palm Beach County’s market.

“If you have such a paucity of one- and two-bedrooms, you’re not really addressing the millennials or the empty-nesters,” Murray said. “That’s a real competitive disadvantage in Wellington.”

He and his team also pointed to Wellington’s aging homes and rising home prices. “Everything built in Wellington since 2010 has been fairly high-priced,” Murray said, referring to the village’s $600,000 median home value. The home-buying trend is “newer is better,” and fewer people want to make time and money investments to fix up older homes, he said.

Even with Wellington’s challenging home landscape, the village’s economy held “some real surprises” for researchers, said Kevin Greiner, research fellow with FIU’s Metropolitan Center.

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More than 2,100 businesses in Wellington employ more than 19,000 people, FIU found, with more than $3.23 billion in annual sales. Equestrian businesses account for about $95 million of those total sales, with that sector alone employing nearly 1,000 workers. And that number doesn’t account for part-time or seasonal workers, only full time, said Maria Ilcheva, FIU Metropolitan Center senior researcher.

Wellington’s economy does not rely on any one sector, Greiner said, with “atypically diverse” businesses that help the local economy resist change. The village also outperforms the rest of Florida on job growth. “Businesses that are located in Wellington have grown faster and employed more people than the rest of the county,” he said.

Many of those businesses are small, with 86 percent of them having fewer than 20 employees, FIU found.

Wellington residents largely work from home in a number of “very sophisticated businesses,” Greiner said. “You’re this 21st century economy, apparently, and the geography of your employment is 21st century.”

The research puts Wellington in a position to rethink the way it markets itself to potential new residents and businesses, Greiner said. “This is a story that I don’t know if it has ever been told, about this absolute spectrum of economic robustness you have,” he said. “… There’s a rethinking of the Wellington story that plays very much into your description of yourself.”

Village manager Paul Schofield cautioned the village must be careful about how it moves forward, pointing to the nearly 20,000 housing units and 7 million square feet of commercial space growing in the western communities.

“We’re going to have to compete with that if we want to keep that 35 percent of (home) sales,” he said.

Mayor Anne Gerwig referred to North Palm Beach, which, like Wellington, also is largely built-out with mostly aging homes. “They have done something in that community that has maintained property values with aging housing,” she said.

Many of Wellington’s homes were built in the 1990s or earlier, and few of those are multi-family. More units are converting to rentals, Schofield said, but too few of those serve Wellington’s “workforce” community: Those who make between $100,000 and $125,000 a year.

“The 60-plus demographic and millennials are looking for smaller units,” he said. “We maybe need to look at those type of units.”

For Vice Mayor Michael Drahos, FIU’s research “reaffirmed” what he already knew: The majority of Wellington is families, and he wants the focus to remain on attracting families to the village.

While Wellington home prices average higher than other areas in the county, a home in village boundaries has something Arden and Westlake do not — guaranteed entrance to Wellington’s coveted public schools, several council members said.

While Gerwig and assistant village manager Jim Barnes questioned the difficulties of drawing millennials to Wellington — Gerwig was concerned the lack of transit may not be a draw, while Barnes said they may not want to live in the suburbs — FIU’s Murray said millennials have been the subject of discussion for about a decade now.

“The millennials are now our starter families, and they are trending more now toward buying homes and raising their kids,” he said. “They’re now the same age as the families who probably founded Wellington 30, 40 years ago.”

The demand from that generation is shifting, he said.

“I think that’s why we don’t target generations, we target families,” Drahos said.

FIU’s Greiner said there’s one thing especially that helps Wellington stand apart: “You’ve already got this story to tell to businesses, to employers and to prospective new residents,” he said. “… ‘We’ve got a quality of life that the brand new construction can’t compete with.’”

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