Wednesday, February 20, 2013

Almanac Weekly Article: Rustic Without the Rust

Catskill Farms was recently features in the Almanac Weekly's article, Rustic Without the Rust, by Lynn Woods:


Rustic Without the Rust

Charles Petersheim didn’t know a soul in the Catskills when he left New York City post-9/11 and purchased an abandoned shack in Sullivan County. Petersheim, who had done construction and real estate in the City, found work upstate renovating old farmhouses for weekenders – and quickly made an important discovery: The first-time second-homebuyers who were his customers found the process unbelievably stressful. The charming rustic cottage on three or four acres that is every Manhattanite’s or Brooklynite’s country dream sometimes turned out to be a money pit with all kinds of disappointments and problems.
Petersheim saw an opportunity. In 2002 he launched Catskill Farms, which offers the ideal alternative: building new homes modeled after the old farmhouse. Using salvaged wood as accents and planks for the floors, refurbishing old radiators for the cozy steam-heat systems and siding his abodes in pine or cedar, with metal roofs and fireplaces as options, he realized that he could build farmhouses with all the charm of an original but none of the hassle.

All his homes are energy-efficient, with spray-foam insulation and on-demand hot-water heaters. Plus, the customer can weigh in on the design, such as the height of the ceilings, size and placement of the windows and location on the property, avoiding a common pitfall of old homes, which is they are too close to the road. “We’ve been able to capture the romantic essence of an older home, which is a very subliminal thing,” Petersheim said. “Our homes have a heart.”

As you may guessed from that remark, Petersheim is also a marketing whiz. His company’s website, www.thecatskillfarms.com, powerfully evokes the Catskills’ down-home appeal, from the personal testimonials to the vintage graphics to the country-music classics that play as you flip through the virtual brochure. The company has been featured on DIY’s Blog Cabin, and three of its homes will be featured on the February 14 episode of HGTV’s Selling New York program at 6:30 p.m.

While the 1,600-square-foot “farmhouse” and 1,300-square-foot “cottage” are his most popular models, he also constructs mid-century ranch-style “moderns” and “micro cottages and shacks”: 700-square-foot cottages that start at $185,000. Customers can pick features from different models and combine them and choose where to put the driveway, said Petersheim. So far, Catskill Farms, which employs 15, has built more than 100 houses, with sales of $36 million. Nearly half of them were small farmhouses priced just under $350,000: the “sweet spot” for most customers, Petersheim said.

Most of his houses were built in Sullivan County, where land was cheaper and more available. It has been Petersheim’s dream to build houses in Ulster County, and last summer that dream became a reality. In 2012, he sold 18 homes, nine of which were in Ulster, and plans to expand into Columbia County next. The farther east he moves, the more expensive the houses: Petersheim said that his farmhouses sell for 12 percent more in Ulster than in Sullivan County and start around $395,000.

Petersheim said that the strength of Catskill Farms’ product is borne out by the fact that he has not only survived during the Great Recession, but prospered. Partly it’s because of his business savvy. For example, the company is vertically integrated, meaning that it offers everything from soup to nuts (realtor sales to the final paint job). And to save on the cost of spray foam, which he said is priced artificially high due to a monopoly, he started his own company, Ecotech Spray Foam, in 2009.

Based in Barryville, Petersheim said that working in Sullivan County has been challenging. “My day-to-day existence was one of loneliness and having no industry peers in what I was doing. I spent a lot of time in an area with scarce resources and a shallow pool of labor, and it was a real struggle to grow.” Hence, expanding into Ulster is a kind of arrival.

On the other hand, he said that his company serves as a gateway to the Catskills for many urbanites, regardless of the county, with an average of 12,000 hits to his website a month. “So many people fall in love with the area,” he said. “We would like to leverage real estate and construction skills and resell other homes. I’m positive we have many more challenges in front of us, but I’m excited there will be less of a headwind and more tailwind.”

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