Wall Street Journal – MANSION / Nov. 28, 2014 / by Amy Gamerman

When Money Grows on Trees

           Homebuilders discover a growth industry constructing new homes around majestic old trees.  Buyers will pay a premium for a “been-there-forever’ look – and see a payback when it’s time to sell.

          “You can’t go out and buy a 50- or 75-year-old oak tree,” said Jack Perkins, vice president of Elm Street Development, a residential developer in Washington, D.C.  Elm Street bought an 8-1/2 –acre estate near Georgetown to build 1801 Foxhall, a community of 27 multimillion-dollar homes.  Before breaking ground on the project, the developer dispatched an arborist to catalog and evaluate every mature spruce, sycamore and poplar tree.

          A towering pine in the front yard helped sell Stephanie Johnson on a $3.12 million Georgian-style home at Foxhall in 2011. “We wanted a house that looked like it had been there for a long time, with lots of trees,” said Ms. Johnston, a 51-year old homemaker.  She and her husband, Hunter, a 54-year-old attorney, were also won over by the four large trees in a developer-designated “tree-preservation area” bordering their property.  These set-aside groves can help add a premium of anywhere between $500,000 to $1 million on the average Foxhall lot price, according to sales manager Chris Kopsidas.

          Brian and Katherine Lucas, who bought an undeveloped Foxhall lot for $2 million in April, are taking elaborate measures to preserve the mature trees on their site.  “There have been meetings just about the trees between us and the developer and the arborist,” said Mr. Lucas, 42.  During construction, the trees will be fenced off the prevent trucks from compacting the soil and causing irreparable damage to the root systems.

          That investment will pay off in market value, according to Wes Kocher, a spokesman for the International Society of Arboriculture, a nonprofit group that certifies arborists.  “Homes with mature trees and well-landscape yards can sell for as much as 20% over homes without those features,” he said.

          A 2010 study by the US Forest Service conducted in Portland, Oregon found that the presence of a single street tree” in front of the home added over $7,000 to its sale price.  The street-tree effect spilled over to neighboring houses, increasing property values as well as helping the homes sell faster.

          “If you have a valuable house with a large tree, it’s going to have value in tens of thousands of dollars, which suggests it would be worth considerable expense to work around it,” said Geoffrey Donovan, the Forest Service research economist who conducted the study.