Selling Luxe In a Time Of Struggle

At Marlboro Ridge, Prices Aren't Coming Down, and Neither Are 'For Sale' Signs

In the pale, creamy floor-to-ceiling-marble bathroom of the marquee model home at Marlboro Ridge in Prince George's County, two people can sink into the raised tub, sip champagne and soak away their stress.

The master suite's his-and-hers custom closets are worthy of a Georgetown haberdashery, with partitioned drawers for tie stays, cufflinks and other accessories, plus display shelves for her collection of shoes, scarves and bags.

A $50,000 home information data center controls voice messaging services, weather channel access, heating and cooling system monitors, closed-circuit cameras, intercom and buzzer systems. Downstairs, friends can sit at a bar and watch sports on one of 10 flat-screen television, roll a few games in the full-size duckpin alley and take a sauna in the spa.

The economy may be stuck in a quagmire, but the American dream is still for sale. Prince George's County has one of the highest foreclosure rates in the Washington region but maintains its hopes and ambitions for more upscale housing. So how do you sell expensive new houses at a time when few are buying? At Marlboro Ridge, Toll Brothers' new luxury community, for both builder and buyer the issue is price.

Tanya Johnson, who is shopping for a home with her fiance, Hillary Keenan, has long admired Marlboro Ridge's Estates model, with its rotunda dining room and marble master-bathroom suite. But these days, she compares it to another high-end production home, by another builder several miles away. That house has never been lived in and has been foreclosed on by the bank. It sits on three full acres, has a three-car garage and costs $300,000 less than the Toll Brothers top-of-the-line model.

"We came here when Marlboro Ridge first opened," Johnson said. "We like Toll Brothers, and we really loved that house, but we thought about how much all those options would cost. Even with the specials, even with time on our side, this price needs to come down."

Toll Brothers' business is down, but appearances are kept up. Marlboro Ridge, in Upper Marlboro, has an equestrian flavor that is announced by 20 acres of fenced green pastures and an imposing bronze sculpture of a rearing stallion at the entrance. The footprint of a stable and riding center is mapped out, although construction has been postponed.

Given the state of the market, many shoppers expect that Toll Brothers, the nation's largest luxury builder, would have cut base prices at Marlboro Ridge. They're surprised to see that they have not. The starting price for the highest-end model in the top-of-the-line Estates collection is $863,995. Homes in the executive-level Hunt collection start at $634,995. Those in the single-family starter Glen collection begin at $563,995, and the Meadows townhouse base is $364,995.

"We don't lower our base prices," said Wes Hummer, assistant vice president for Toll Brothers' Southern Maryland division, which includes the Marlboro Ridge project.

One of its primary sales strategies in a struggling market has been to offer promotions. In October, there was an open house where buyers could meet design and style maven B. Smith and choose from collections she had created with Toll. Last weekend, the builder offered 50 percent off all options, plus cash allowances buyers could use for whatever -- closing costs, adding a room, moving costs.

Company sales continue to be slow. This week, Toll Brothers reported that its home-building revenue dropped 41 percent year over year in the latest quarter. For the full fiscal year, which ended Oct. 31, revenue declined 32 percent, though the company reports having $1.63 billion in cash, liquidity that is key to being able to make interest payments and fund operations. The company hasn't reported complete results for the year yet, but in the first nine months, it lost $219 million.

Robert I. Toll, the company's chairman and chief executive, has said that the company is now in the third year of the worst housing market since his family started the business in 1967. Visitor traffic and home deposits are at historic lows. Contracts are down nearly 30 percent from last year. And the close of the year is expected to be even worse.