While others are delaying work, Newland Communities is continuing work on its development Waterset, hoping the housing slump will be over by the time work is completed. News Channel 8 photo by PAUL LAMISON

TAMPA - In the heart of Apollo Beach, hidden by swaths of vacant land, is a scene reminiscent of the boom years.

Bulldozers carve holes for more than 20 lakes, surrounded by concrete walking paths. Street signs and sidewalks wrap around nearly 200 homesites primed for construction. Piles of waterline pipes wait to be installed under thousands more lots.

In the midst of the worst housing downturn since the Great Depression, one company is moving forward with plans to develop 6,400 homesites in a 2,350-acre master-planned community.

The developer, San Diego-based Newland Communities, hopes Waterset - between Big Bend Road and 19th Avenue - will kick-start the local real estate market. And it's betting the troubled market will be ready before the planned grand opening next fall.

So what does Newland know that makes the developer so confident the area can absorb thousands more homes?

Competitors, many of whom have scrapped plans or put projects on hold, wonder.

Even Newland executives admit their optimistic plans are somewhat risky in a saturated housing market. Other developers have put plans on hold or have scaled back dramatically. Some builders face foreclosure on their land and are selling at fire-sale prices. Across the Tampa Bay area, there are shells of subdivisions that started during better times and have stalled.

"Other builders and developers may look at us and say, 'They're crazy,'" said Pam Parisi, regional marketing director for Newland. "But we have a real passion for this. We want to be ready to pull the trigger when the market comes back."

There are more than 31,000 vacant lots scattered throughout the area, according to housing research firm Metrostudy. That's on top of 2,982 empty homes that builders have been unable to sell. Homes are selling so slowly that Metrostudy estimates it could take more than five years for builders to work off all the inventory of finished homes and lots.

Jack McCabe, of McCabe Research & Consulting in South Florida, follows the state's housing market and said Waterset is unique, aggressive and risky.

"How do we keep adding on to an oversaturated marketplace?" McCabe said. "Some developers think that when others fail, that's when they'll succeed. But this is a move that comes with a heightened degree of risk during these very uncertain times."

Newland's plan may sound overly confident, but Rick Harcrow, senior vice president of operations, said it's important to put in the infrastructure now, so the company is ready to launch the community as demand picks back up.

"We have to take a longer view than some smaller developers," he said. "The life of the development process of these communities sometimes lasts 10 years."

One thing is for sure. Newland isn't without experience. It is among the largest land developers in the United States. Locally, its claim to fame is FishHawk Ranch in Lithia. Newland also developed Covington Park and MiraBay, both in Apollo Beach, and Westchase in Tampa.

FishHawk, with more than 5,000 homes, is known for its nature trails and townlike atmosphere. It has been popular, even during the downturn, Parisi said.

"Our builders are always asking, 'Can we build any more in FishHawk?'" Parisi said. "It has a proven location."

Waterset would be even larger than FishHawk, and its location could draw buyers from Sarasota, St. Petersburg and Tampa.

Above all, Waterset has time on its side, said Scott J. Jones, vice president of operations at Newland. It would take 15 years to build out the neighborhood.

In The Footsteps Of Tampa Palms

Waterset isn't the first master-planned community to launch during a downturn. In the early 1990s, subdivisions with now-recognizable names such as Tampa Palms and Cheval were just getting started and struggled to attract builders and buyers. But it took many years to build out the neighborhoods, and they are successful.

There are other large-scale projects planned for the Bay area, said Marvin Rose, of Rose Residential Reports, which tracks new housing development. But Rose said Waterset is the only one he knows of that is moving forward with developing homesites. Many others are scaling back or waiting until the market improves.

"I would never second-guess Newland," Rose said. "They're a lot smarter than I am. They're not developing the lots for fun."

Another large development, 5,000-acre Wiregrass Ranch in Wesley Chapel, is taking a different approach.

David Evans, spokesman for the project, said developers are moving forward with plans for an open-air shopping mall and office space, but plans for the 8,000 homes are on the back burner.

"About 2,000 of them are owned by a builder, and the rest won't be built on for at least two to three years," Evans said.

Evans said he applauds Newland's efforts and is interested to see how the project is perceived by builders and home buyers.

"Location is everything, and they may have a really good one."

Harcrow thinks so.

"The transportation network is already in place," Harcrow said. "The drive-time to other places in Tampa Bay really isn't bad."

Waterset is about a half-mile from Interstate 75; FishHawk is about seven miles from the interstate.

'This Won't Last Forever'

The planning for Waterset started in 2004 and has changed with the market. Lot sizes have been tweaked to accommodate smaller homes. The company wants the development to offer a diverse price-point. Homes will start at $140,000 and top out at more than $500,000, Parisi said.

To do that, Parisi said, as many as 14 builders will likely be involved.

"It seems the under $300,000 price-point is critical for our market," she said. "We do a lot of research to gauge what people want. We know we have to offer the affordability factor."

Because so much of Waterset is in the development stages, Newland is silent on a lot of the details. But one of the unique features the company can't hide: a 35-acre lake that is now a big hole in the ground. Waterset is also to include retail and office space, restaurants, and entertainment.

"We'll have duplexes and triplexes that front the lake," Jones said. "It will look great."

Newland executives are gambling that they'll be able to sell the lots when they want to. To be ready for a grand opening next fall, builders need to start construction on some homes about six months before the opening.

There has been a lot of interest, company officials say, but no builders have signed on.

At least one big name is at the drawing board, though.

Charley Hannah, vice president of Hannah Bartoletta Homes, has attended planning meetings and said he hopes to be part of Waterset when the timing is right for his company.

"It's an exciting, unique community," he said. "Every 15 to 20 years, there's a mega real estate downturn. This won't last forever."

Reporter Shannon Behnken can be reached at (813) 259-7804 or sbehnken@tampatrib.com. Keyword: Waterset, to watch Shannon Behnken's video report about Waterset.