Ed McLamb, its president, says his company attracted Horton through its Home Builder Buyer Incentive program. The program provides model merchandising and design expertise, a gift with their purchases to get home buyers started on furnishing their house, and a branded credit card through which owners can continue purchasing furniture from Lexington at discounts of up to 40 percent. This summer, three of Horton's communities in Charlotte—Lake Shore, Ayrsley, and The Vineyards—will have models featuring name-brand furniture supplied by Lexington.
Dressing a model home typically runs about $23 per square foot. But by furnishing models under one brand, Horton has reduced that to between $16 and $20. And through its “designer challenge” program, the builder is trying to lower the cost to $14 per square foot. “It can be done,” says Trotter, the design consultant, who is working on four models—under the brands Pier One and Wal-Mart (for single-family homes); and Crate & Barrel and Target (for townhouses)—that will be grouped on one block at Horton's Cedar Mill community in Charlotte. Trotter is dressing each for no more than $28,000 and is working with Crate & Barrel directly. The involvement of the other dealers is passive, but Trotter is purchasing virtually everything she needs from their Web sites.
Trotter is also developing a microsite for Horton, scheduled to go live in March, that lets buyers tour each model and order furnishings online, using an encrypted password they receive at closing. “There won't be a lot of choices, but we've found that many buyers want to buy the room exactly as they saw it.”
FAMILIAR NAMES: D.R. Horton's Parks at Eastview community in Charlotte, N.C., includes a model home that the builder has branded with Restoration Hardware, the home-de'cor retailer that provided the furnishings for that model. In Charlotte, Horton has 26 branded model homes under the names of eight retailers including Crate & Barrel, Pottery Barn, and Country Living.
Horton's rollout plans are sketchy, but Schwartz says the builder's divisions in Florida and New Jersey have expressed interest. Restoration Hardware is consulting with Horton's Raleigh division, and Naro sees no reason why this program couldn't be extended “up and down the East Coast,” McLamb says. “To grow our business, we need to be able to do this in volume, but we don't feel we [need to] be doing this with other builders.”
His company is working on four models in Horton's resort community in Myrtle Beach called Tuscany, which should be ready this spring. Hough says these models will take the Charlotte concept “one step farther” by letting buyers purchase “the entire package, a room, or just one product.” Schwartz also hints at a future TV tie-in to promote the branded models, which he anticipates would have a receptive audience. “So many people come into a model and ask where they can get those products. We don't want to lose customers after they close.”