Bay Area: Back to the future—Are condos the new apartments???

I have to admit it…I was dead wrong. I thought (like many others) that condos were going to be dead for a while.  Many people really don’t want to live in a condo but they end up “settling” for them because of the relative affordability closer to job bases. As prices in the Bay Area have resumed their pre-collapse march up at 10+% per year, condos are making resurgence.

Given the resurgence in attached for-sale product in the Bay Area, the “highest and best” use has now probably switched back to condos from apartments.  And it probably won’t be long before we see the reverse of what happened a few years ago where condo sites were re-entitled to apartment deals.  Now we’ll start seeing apartment sites re-entitled to townhomes and condos. If you have one of these sites feel free to give us a call to help evaluate all the options in the fast changing market.  There are many factors to consider in making this kind of decision; our in-fill experts can help you juggle all the factors to position your site for maximum sales proceeds!

http://www.contracostatimes.com/business/ci_22613042/bay-area-condos-tight-supply-has-buyers-scrambling.html

Source: Steve Reilly, Marketing Consultant, (925) 368-3128

Warm Weather and Hot Rents in LA

As we begin to approach the fall, you can bet the weather will cool down but the apartment market will continue its hot streak. The Los Angeles Infill Team has been paying close attention to apartment rental trends and has seen favorable signs for continued rent growth.

Apartment rental rates in Los Angeles continued on their strong path of growth as seen in year-over-year data in the second quarter 2012. Average rents for all types of rental units increased 5.3%. The biggest surprise may be the average YOY growth seen in both two and three bedroom townhome units. Rents in two bedroom townhome units increased an average of 13.8%, while rents in three bedroom townhome units increased 17.2%. Townhome and three bedroom units have seen a large boost in pricing as many families displaced by foreclosure try to find units large enough to accommodate them. Several buyers, including investors and developers, are paying close attention to these statistics and are pushing to purchase properties with the ability to build and rent townhomes then convert them to condominiums as the for-sale market improves. Average occupancy rates have continued to tick upwards and touched 95.5% in Q2 2012 for metro Los Angeles.

These are strong signs keeping the search for apartment land deals atop the list of many builders and developers. The Los Angeles Infill Team at Land Advisors recently transacted on a rental townhome project and has a handful of other apartment deals under contract. Our team is well versed in the local rental market and eager to discuss available and active apartment projects.

For further questions and information, please contact Chris Gomez-Ortigoza, Tim Barden or Richard Byrd at (626) 376-9840.

The following news articles highlight the strength of the rental market in Los Angeles and throughout Southern California.

http://www.nbclosangeles.com/news/local/Rents-on-the-Rise-Across-Southern-California-147394535.html

http://www.zoliath.com/commercial-real-estate-blog/2012/09/12/los-angeles-apartment-market-set-for-significant-growth/

Source: Chris Gomez-Ortigoza, Marketing Consultant

New 360 Acre Development Coming to Monterey County

City of Del Rey Oaks and Brandenburg Properties are preparing to team up to develop 360 acres of undeveloped Fort Ord land.  The City would like to see a low-density residential development and a hotel with condominium units and they would like to see “green, sustainable” development, including the use of cisterns to help with water supplies.  The Del Rey Oaks land is generally located north of South Boundary Road and east of General Jim Moore Boulevard.  Part of the project lies next to Fort Ord acreage the city of Monterey has planned for eventual development. FULL STORY

New Monterey County listing hits LAO

The Central Coast Team of the Land Advisors Organization is pleased to present Parcels D & E featuring 13.51 multi-family acres for ±378 apartment units.  The subject sites are located in Monterey County along scenic U.S. Highway 101, within the northerly reach of California’s Central Coast and in the heart of the famed Salinas Valley. Soledad is known for its natural beauty, moderate climate, and abundant agricultural products. Soledad is now home to more than 17,000 residents with a mix of early 20th century architecture with a charming historic downtown commercial district and vibrant new residential neighborhoods.

Contact: Matt Power at (805) 845-2660 or Jim Radler at (916) 784-3329 for more information on Parcels D & E.

Source: Matt Power, Senior Marketing Consultant, (805) 845-2660

Summer Sizzle in The OC

The summer sun is here and hopefully it’s shining bright on Taylor Morrison’s GRAND OPENING of the Palisades – located in the Vista Del Verde master plan in Yorba Linda. Townhomes will range from 2,206-2,626 square feet and pricing starts in the high $500’s for 6 floor plans.  The opening event is planned for Saturday, June 30th!

Apartments here in Orange County remain HOT!  Rents are UP and more supply continues to come on the line and lease up quickly – even leasing up ahead of schedule, as is the case at The Irvine Company’s newest community, Cypress Village.

The City of Lake Forest approved Toll Brothers & Shea’s plans for Baker Ranch, a +2,300-unit development on +380 acres. The land is one of the City’s “Opportunities Study Areas,” enabling residential development now that the land use is no longer affected by the El Toro Marine Base flight path.

In the recent elections, the City of Yorba Linda passed both Measures H & I.  The Measures allow for increased development on a number of sites that will accommodate moderate, low and very low income households.

The Olson Company will be building 27 single-family homes and 61 townhomes  at the future Solano Walk in Fountain Valley adjacent to the Civic Center.

Source: Allison Rawlins, Marketing Consultant, (949) 852-8288 ext. 26, and Mike Hunter, Senior Marketing Consultant, (949) 852-8288 ext. 37

Inland Empire… It’s FBO!

Economic news in Southern California’s Inland Empire appears to be looking up these days.  But is the homebuilding recovery here to stay?  Is it Facebook Official?

Last week, Land Advisors’ Senior Marketing Consultant Doug Jorritsma gave a presentation to a group of professionals regarding the state of the land/homebuilding market in the Inland Empire (Western San Bernardino & Riverside Counties).  On board with the wave of social media sweeping our communication style these days, Doug kept the message short, sweet, and direct, highlighting the market facts with a Facebook-like thumbs up or thumbs down.  Check ‘em out here…

DISLIKE

  • Unemployment/job generation still a big problem
  • State financial crisis looms large (Redevelopment Agencies and Schools)
  • Construction lending still challenging
  • Number of housing permits is currently 28% of what is was at the market’s peak

LIKE!

  • The worst is behind us!
  • Lenders dispositions are done! (Except for the little stuff.)
  • Most public and private homebuilders will be increasingly active going forward
  • Single and multi-family building permits are on the rise – (Currently DOUBLE 2009 numbers)
  • Institutional capital and private equity slowly giving THUMBS UP
  • No finished lot supply creates a near-term shortage
  • Land values are slowly trending up
  • Foreclosure activity is trending down
  • Five-month upward trend of improving new home sales
  • Big box industrial gets a double THUMBS UP
  • Interest rates are to remain low through 2014
  • Consumer confidence is improving which means retail sales are improving
  • Apartment vacancies currently at 4% – 6%, rents are up 1% – 5%

Land Advisors ♥’s Social Media

Source:Doug Jorritsma, Senior Marketing Consultant, and Winn Galloway, Senior Marketing Consultant (949) 852-8288

San Diego County Market Trends Update

The Coastal Counties of Southern California (including San Diego County), continue to garner attention as on the fast track to a near-term market recovery in the housing market.

The word on the street today in the real estate industry (locally and on Wall Street) is that San Diego County is suffering from a supply shortage of new construction rental housing.

A robust supply of capital appears to be anxiously awaiting the opportunity to finance the development of new multi-family housing in “A” and “B” locations throughout the County. Given the perceived shortage of new construction rentals, nine multi-family projects totaling over 2,600 units are currently in the planning pipeline.

Vacancy rates among new rental townhouse properties that are built and designed with for-sale housing features in the County are close to 100% occupancy, likely due to the ownership of housing design and upgraded features (direct access to two-car enclosed garages etc.), attracting the many foreclosure and short sale “refugees,” or casualties from the “Great Recession.”

The majority of vacant multi-family properties are currently offered in the range of $50,000 to $100,000 per door, depending upon the strength of location.

SAN DIEGO S-CURVE: In the new construction for-sale housing sector, the “San Diego S-Curve Submarket” has dominated new home sales in the County for the last 12 months.

The S-Curve Submarket can be described geographically as: Beginning with the Carmel Valley (Pacific Highlands Ranch, Carmel Country Highlands etc.), moving east along Highway 56; and then north through the Torrey Highlands/Westview High School area along Camino Del Sur up to and including the Del Sur Ranch, and then east through the 4S Ranch and Camino Del Norte Road.

New home communities located within the S-Curve submarket attract many of the white collar executives and engineers who are employed in the biotech and high-tech firms such as Qualcomm, Sony, Hewlett Packard, etc.  These consumers place a heavy premium on the stellar public schools serving this submarket.  They also find access to this area convenient through Interstates 5 and 15, and Highway 56.  The majority of subdivision land within this submarket accommodating new single family detached housing has been equivalent to values ranging between approximately $300,000 and $500,000 per finished lot, depending upon location and lot size.

North San Diego County: In North County large scale residential development remains to be developed in master plans within Del Sur Ranch, the West Robertson Ranch, and Pardee’s land holdings in the Pacific Highlands Ranch Area (east Carmel Valley). A number of sizeable land plays located within the North County perimeter submarkets (Bonsall, Escondido, Valley Center, Fallbrook, Pala Mesa, and the I-15 Corridor between Riverside and San Diego Counties) are awaiting a demand push for the relative large supply of lots and homes in the region.

East San Diego County: In East County, the Fanita Ranch in Santee has yet to be developed.  A steady supply of small bite-sized infill land opportunities are emerging.

South San Diego County: The South Bay is the “800-pound gorilla in the room” because it has thousands of residential units remaining to be developed within existing and proposed master planned communities in the East Chula Vista area and Otay Mesa area.  The Baldwins and extended family, McMillin Communities, and Home Fed are a few of the builders/developers with skin in the game.  In addition, the area between East Chula Vista and the Mexican border (Otay Mesa, Brown Field etc.) has the potential for a large volume of new housing development within the next five years given the revised zoning currently being considered by local government.

With the pending housing market recovery, the development of a vibrant downtown San Diego housing market will be in reach again, once the dust settles concerning local government redevelopment.

Source: Bob McFarland, Marketing Consultant, (858) 568-7428

Demand Rising for (Residential) Land in Fresno

More land buyers than sellers? That’s the story in Fresno today.  In preparing for the economy to rebound, builders are reloading their inventory of buildable lots.  However, finding lots at market rate prices is not easy in Fresno.  Lot inventory has been thinning since 2008 and only a handful of new maps have been recorded or are currently in process at the City.  Inferior locations are still quiet, but residential lots that are in A & B locations are receiving multiple bids.

  • April 2012 Finished Lot Inventory: Fresno = 1,051 Vacant Finished Lots; Clovis = 1,199 Vacant Finished Lots

April 2012 – Land Advisors closed additional finished lots on a rolling takedown to Lennar in southeast Fresno.  The public homebuilder bought the lots as an extension to a legacy project it already has under its wings.

Apartment activity is picking up: This month Santa Barbara Bank & Trust sold 8 acres of unimproved land, approved for 78 multifamily units.

ZONE CHANGE APPROVAL:  On April 4th, the Fresno Planning Commission  unanimously approved plans and a zoning change for a north Fresno 118-home development by McCaffrey Homes with a stipulation that homes on the east side of the project adjacent to the existing Bella Montagna development will be single story.  FULL STORY

  • The 13-acre site was originally zoned for commercial/retail use.  The recent approval by the Planning Commission is controversial for the local residents in the area, and the Fresno City Council will now meet on the issue to vote. (Watch the VIDEO via CBS 47)

GENERAL PLAN UPDATE:  The Fresno GP update calls for a more controlled approach to residential growth. Earlier this month, the Fresno Planning Commission unanimously endorsed Plan A which aims to maintain the current sphere of influence, and protects prime agricultural land from becoming more subdivisions.  Approval is slated for April 19th.

Source: Mark Utman, Marketing Consultant, (559) 549-6326

Central Coast Team Sells 28-Unit Apartment Project within San Luis Obispo Mixed-Use Development

Land Advisors Organization – California Division is pleased to announce the closing of Village at Broad Street (Parcel II), where Presidio Capital Partners, Inc. with Fuller Apartment Homes, Inc. purchased 28 for-rent apartment units from H&D Maymont, LLC for an undisclosed amount.

The ±1.41-acre Parcel II was the last remaining parcel available for sale within The Village at Broad Street.  The project is located in close proximity to downtown San Luis Obispo, east of Emily Street between Roadhouse Avenue and South Street.  The Village at Broad Street is a mixed-use development that includes a newly opened Fresh & Easy Neighborhood Market and 42 multi-family affordable apartments. ROEM Corporation developed the affordable living component and finished construction in January 2012.

“The downtown area of San Luis Obispo has always been a very desirable location, and The Village at Broad Street project further enhances the quality and vitality of the area,” stated Land Advisors’ Senior Marketing Consultant Matt Power, who has been tracking residential land activity in the Central Coast region of California for about ten years.  “San Luis Obispo is a unique submarket and continues to draw interest from the building community.”

Read the Complete Press Release Here

Urban Infill Team Facilitates 1031 Exchange Deal in Burbank

Land Advisors Organization – California Division is pleased to announce the closing of a 21-unit apartment building, where Steve Porretta purchased the Burbank property from Essential Assets, LLC for $4,200,000.

Land Advisors’ Urban Infill Team, which is based out of the firm’s Pasadena office, facilitated the multi-family property sale by assisting Mr. Porretta with a 1031 Exchange. 

In 2011, the Team assisted Mr. Porretta with the sale of his Silver Lake property, “Waverly Terrace Townhomes,” which included 63 unimproved townhome lots with a recorded final map.  

Mr. Porretta then needed to find a reinvestment opportunity and looked to Land Advisors’ market knowledge and extensive network of industry contacts for purchase options.  Through its list of industry relationships, the Urban Infill Team was able to source the off-market 21-unit apartment building, and represented Mr. Porretta and Essential Assets, LLC in the transaction.

“Mr. Porretta needed something very specific,” noted Land Advisors’ Senior Marketing Consultant Richard Byrd.  “By calling on our industry contacts we were able to provide several opportunities for Mr. Porretta to choose from.”

Read the Complete Press Release Here 

West Riverside Report

MULTI-FAMILY: Last week Land Advisors’ West Riverside Team wrapped up the marketing of a 16.5-acre mixed-use (multi-family for-rent and commercial) site known as The Village at Magnolia Square, located in the City of Riverside.

With a lack of comparable land sales early in 2012, the initial challenge in selling the multi-family for-rent land was determining the market value.  Assuming a successful escrow and close, The Village at Magnolia Square will mark the third successful multi-family for-rent land sale in the West Riverside submarket (Land Advisors Organization has been a party to all three sales). With three transactions soon under its belt, Land Advisors’ has established a real value foundation for similar land sale opportunities in the submarket.

SINGLE FAMILY: On the single family detached home front, the overall market in West Riverside remains stagnate.  However, homebuilders are finding success in some areas of South Riverside County such as Temecula.  Stronger than expected interest from homebuyers is causing some homebuilders to increase home prices. If strong absorption rates continue, the finished lot and future lot supply within Temecula will quickly vanish, and likely result in pressure on lot sales in Murrieta, Menifee and Wildomar. One development company has already noticed this trend and purchased one development site and has another in escrow in Wildomar.

APPROVALS:  On Tuesday March 13th, the City of Wildomar heard residents’ environmental concerns for a proposed 151-acre residential project. The project will be developed into 315 single family homes with 3.5 acres dedicated to a commercial center and open space. 

In addition, Menifee’s City Council approved a new General Plan land use map after a two year-long process, with a vote of 4 to 1. The land use plan is the first element in writing for the City’s new General Plan and serves as the basic blue print for how land will be used going forward.

Source: Mitch Casillas, Marketing Consultant, (949) 852-8288 ext. 23

Giddy Up Fresno!

Hold on to your hat… New homebuilders who have lot inventory in the Fresno sub-market are now building again!  Fresno construction starts are UP since the same time last year. 

Major Player: Lennar HomesFresno and Clovis combined saw 219 new construction starts in the last quarter of 2011, (4Q 2010 saw only 161 starts).  Lennar Homes led the way with the most starts of any builder with 43.  Wilson Homes and Bonadelle Neighborhoods came in a distant second and third with 27 and 26 starts, respectively. The most active sub-market in 4Q 2011 was Clovis South with 66 starts (up from 44 starts in 4Q 2010).

Lennar also controls the most lot inventory of any builder in Fresno.  Of the 2,425 total vacant finished lots in the Fresno sub-market, 296 (12%) are owned by the public homebuilder as of January 2012.

Project of NoteBonadelle’s Bella Vista at Brighton is seeing impressive sales in its early phases.  The project’s success is breathing new life into the Millerton area sub-market as the first phase of the Brighton Master Plan.  The area boasts a ton of amenities including its location… a stones’ throw from Millerton Lake & Marina, Eagle Springs Golf & Country Club, and Table Mountain Casino.  With a natural setting and amenity package that is unrivaled in the greater Fresno area, Bonadelle is seeing buyers come out and purchase as a lifestyle choice and value play to living ‘in town.’  The Fresno Office of the Land Advisors Organization can bring you up to speed on this up-and-coming sub-market.

Home PricesThe latest data from Fiserv Case Shiller shows that national home prices are expected to grow at an annualized rate of 3.2% between 2011 and Q2 2016. BusinessInsider.com combed through Fiserv’s data and picked the best housing markets for the next five years…  Madera ranks No. 3 out of 15 on the list with anticipated annualized growth from 2011 – 2016 of +10.4%.

Multi-familyNew high-end apartments finally return to Fresno with an apartment complex called The Shires. The Penstar Group, a real estate development and construction company in Fresno, recently broke ground on the project and is looking to accommodate pent-up demand now that local rent rates have leveled off.

New Office Location! The Land Advisors’ Fresno office has relocated to 759 W. Alluvial Avenue, Suite 103, Fresno, CA 93711.  The new office phone number is: (559) 549-6326.  Stop by and say Hello!

Source: Mark Utman, Marketing Consultant, mobile: (949) 533-8284

Are Some East Bay Submarkets Now Overcorrected?

Take this into account… According to Real Facts, the average 3 bed/2 bath apartment in Dublin is currently renting for $2,470 per month.  Compare this to the typical monthly payment based on a $450,000 mortgage at a 4.0% rate; the fully amortized payment is only $2,150 per month. Adding property taxes at 1.1% increases the monthly payment to $2,562. Finally, adding a couple more hundred dollars for homeowners’ association costs and/or insurance brings the total monthly housing cost to approximately $2,760.

While this example of home ownership is a few hundred dollars more than the average Dublin rental, it is also based on pre-tax income. To paint a true picture we need to factor in the tax benefit of ownership. In the case of our example above, the total interest and property tax deduction should be approximately $20,000 per year.  Assuming the potential homebuyer is within the 25% marginal bracket, this deduction is the equivalent of a $5,000 per year tax savings, or approximately $415 per month. Taking this into account the true cost of ownership is only $2,345 per month, which is $125 per month less than the average 3 bed/2 bath rental in Dublin.

While all this may not mean house prices are finished declining or that sales are going to double anytime soon, we can definitely read it as a sign that we have reached a key point in the housing cycle, and that bottom has to be close… if we haven’t already hit it!

Source: Steve Reilly, Marketing Consultant, (925) 368-3128

W. Riverside County: Busier Than You Think

Amid slow overall residential land sales activity in West Riverside County, a number of transactions are still moving forward, and are nearing the finish line.

West Riverside County has experienced few improved lot transactions in 2011, as the submarket hasn’t seen any “turned dirt” since 2009.  A public homebuilder recently closed on approximately 90 “finished” lots in French Valley.  Also, two escrows for “finished” lots are scheduled to close by year’s end:

  • A public homebuilder is buying a ±50-lot project located within the City of Wildomar.
  • A private investor is buying a +100-lot project located in Moreno Valley.

In regards to the apartment/for-rent land market:

  • A ±600-unit site is close to going under contract in Temecula, marking another significantly-sized apartment land escrow in this city in the last six months.
  • Corona still has two large apartment land projects on the market.  It doesn’t appear that buyers are stepping up to the seller’s pricing expectations though.  This may be due to sellers’ knack for overestimating rent appreciation in the coming years.

The Land Advisors’ West Riverside Team put two projects into escrow this month that are in the Menifee area.

Source: Mitch Casillas, Marketing Consultant, (949) 852-8288 x23

‘Orange’ You Glad You’re in Orange County?

In Apartment News: AvalonBay Communities commences construction on Phase II of Jamboree Village; rental rates continue to increase in most cities in Orange County (http://lansner.ocregister.com/2011/10/19/apartment-rents-back-to-pre-recession-levels/135453/); construction of two apartment projects on Parcels 1A & 2A at Tustin Legacy is planned for 2013, once infrastructure is completed (http://lansner.ocregister.com/2011/09/28/construction-at-tustin-starts-in-13/125743/).

As of October 1, 2011, conforming loan limits (FHA mortgage limits) were lowered to $625,500 for single family residences, from $729,750 (http://online.wsj.com/article/BT-CO-20111021-700012.html).

City Spotlight:  San Juan Capistrano is considering a 32-unit residential development and equestrian facility on The Oaks horse ranch, as well as a continuing care retirement community at The Orchards, a former Crystal Cathedral property (http://sanjuancapistrano.patch.com/articles/retirement-community-tweaks-plans-eager-to-develop-rancho-capistrano).

Be on the lookout for a new Orange County listing in the next couple of weeks!

Source: Allison Rawlins, Marketing Consultant, (949) 852-8288 x26

Lights… Flashing… Several High Profile Sites Trade Hands in SD County

The San Diego residential land market continues to plod along.  Most offerings are receiving strong interest as the building and development community looks for future inventory.  The general consensus is that the key indicators show stronger markets in the near future and everyone is filling their near-term pipeline (2012-2015).  Land Advisors recently completed the marketing campaign for The Lakes, a 248-lot project in the Rancho Santa Fe area.  The offering received strong interest from around the Nation.

Other notes from around the region…

  1. Meritage Homes made its first entry into the San Diego market with a purchase of 92 semi-finished lots in Oceanside, CA.  The property known as Hi Hope Ranch has a controversial past including lawsuits with the adjoining neighbor, Vista Unified School District, and a bankruptcy.  The property has been on the market for over a year and had been under contract with several builders.  The purchase price was reported to be just over $10 million.
  2. Another high profile Oceanside property also closed escrow.  MG Properties purchased Ocean Village, a “broken” condominium project near the Oceanside City Hall.  According to reports, none of the 33 units in the project were sold and the new owners will be leasing them out as apartments until the market firms.  The purchase price was $11.75 million which should allow the new owners ample room for profits, according to sources familiar with the project.
  3. Proving that you never know where the buyer will come from, a high profile 18-acre infill site in Mission Valley known as West End was purchased at a foreclosure auction last week.  The Buyer, Plaza del Sol Real Estate Trust is believed to be a church group looking for a new campus.  The site had been planned for 490 multi-family units but the project was never approved or developed due to the weak market in 2007-2010.  It is currently occupied by Mission Valley Inn and Frogs Gym.
  4. HOUSING:  According to the experts, foreclosures and defaults were down in September.  Hopefully this signals the start of an orderly process of unwinding the remaining problem properties still in the system, and tempers the uncertainty of prospective buyers:  www.nctimes.com/blogsnew/business/realside/article_fd80ea2f-890c-56bb-8231-d5d4231b30fa.html
  5. Look for new multi-family listings from the San Diego office of Land Advisors Organization in the next few weeks.
  6. Redevelopment of an eyesore in Solana Beach is in the works after American Assets bought a former trailer park on Coast Highway.  The 1.76-acre site at 329 S. Coast Highway finally traded hands at 63% of the original listing price after being on the market for several months.  The Buyer plans to redevelop the site for commercial/residential use.

Source: David Landes, Senior Marketing Consultant, (858) 568-7428

W. Riverside County: Multi-Family Land is Hot…Or Not?

Market Activity – Closed Deals: (Single Family Detached):  Two significant land transactions have closed escrow in the West Riverside County (WRC) sub-market within the last 30 days. In both cases, the buyer was not a public homebuilder. Active buyers in the land market are private investors seeking well-located paper lot and entitlement opportunities and are very bullish in the Cities of Temecula, Murrieta, French Valley, Moreno Valley and Corona.

Public homebuilders remain quiet and are focused on selling through projects they purchased in 2010. However, one public homebuilder does have two sites under contract in Temecula.

A number of other residential projects are currently in escrow in WRC and Land Advisors is on track to close two transactions by month’s end.

On The Market: (Multi-family – For Rent):  Two prominent apartment development sites are available for sale.  Both sites are well-located within the City of Corona.  Apartment land interest and perceived value remains optimistic.  However there have been few sales to justify this optimism. Land Advisors did list and sell Magnolia Village last year which remains the highest comparable apartment land sale in the market.

Building Permit Activity:  In Riverside County last month, builders obtained government permits for 473 units, (257 single family homes and 216 multi-family units – a majority of which are apartments). This is an increase from August which saw permits at 329 units (Source: Press Enterprise).

Source: Mitch Casillas, Marketing Consultant, (949) 852-8288 x23

Rockin’ Out in the OC

  • The City of Irvine approved 5,000 homes at FivePoint Communities’ Great Park Neighborhoods (See OC Register graphic :: http://www.ocregister.com/articles/park-316992-fivepoint-great.html?graphics)
  • A buyer was selected for Pacific City in Huntington Beach; the note sale is rumored to have transacted at north of $55M
  • It’s the end of a water park era: Wild Rivers shuts down this coming Sunday, September 25th to make way for yet another Irvine Company apartment project called Los Olivos, which will bring 1,750 additional units to the Irvine Spectrum area.  Not to worry, though, the Verizon Amphitheater will still be rockin’ until 2017.  http://www.ocregister.com/articles/irvine-318601-noise-units.html

 Source: Allison Rawlins, Marketing Consultant, (949) 852-8288 x26

OC: Steady Sails Amid Global Economic Storm

Standing out as an anomaly among most other California residential land sub-markets, Orange County apartment and single family building activity appears to be cruising along through the global economic waves. According to MarketPointe, new home sales volume increased 17% in OC in the 2nd quarter of this year.

  • Multi-family Market: Dirt entitled for apartment use is currently trading above $2 million/acre throughout the County. “Hot” areas seeing the most activity and highest value include Huntington Beach, Irvine Business Complex (IBC), and Anaheim’s Platinum Triangle.
  • The Irvine Company (TIC) is proceeding with the construction of three new apartment projects around the I-405/I-5 interchange area (also known as the Spectrum).  This is as the Company is completing its 1,500-unit “Park” community where occupancy rates are averaging 97% and rents are averaging $2.09/sq. ft., according to RealFacts.com.  The three new TIC apartment communities will bring another 4,800 units online by 2013.   The 1,677-unit Cypress Village apartment rentals are to begin early in 2012, with construction concluding by the end of next year.
  • Master Plan Activity: Two master planned communities in OC — Tustin Legacy and Rancho Mission Viejo — are moving along, and are both currently interviewing homebuilders and developers for the next phases in their development processes. 
  • Positive OC Builder News: Standard Pacific Says Profits Ahead Despite Share Woes, Housing Jitters

Source: Allison Rawlins, Marketing Consultant, (949) 852-8288 x26

Only 3 Public Homebuilders in Escrow in W. San Bernardino Co.

In the West San Bernardino County sub-market, only three public homebuilders are currently in escrow.  As banks have worked through a majority of their REO inventory, the residential land deal flow has slowed.

Large land plays are making some headway in the Inland Empire, as indicated by the recent sale of Summerwind Ranch for $33.5 million in Calimesa (represented by Land Advisors Organization), which sits on the Riverside/San Bernardino County border. 

However, apartment developers are starting to branch out from the core coastal markets and look for worthwhile deals in the better performing sub-markets of San Bernardino County such as Rancho Cucamonga, Chino, Chino Hills, and Eastvale.

Source: Winn Galloway (949) 852-8288 x27, Marketing Consultant covering the West San Bernardino County sub-market

Urban Infill Update: Multi-Family Market “On Fire!”

A brief Q&A this morning with Land Advisors’ Urban Infill Marketing Consultant, Tim Barden, revealed the following:

  • Demand for multi-family apartment sites in and around the L.A. Basin is WAY up!
  • Hottest selling areas include Hollywood, Pasadena, L.A.’s Westside, and the South San Fernando Valley
  • Existing Class A apartment buildings are selling at record low cap rates
  • Every multi-family developer seems to be trying to get a piece of the action
  • Commentary: With talk of another economic “double-dip,” is multi-family experiencing the same micro-bubble that was seen after the fall of the housing market in ’06/’07?

CHECK IT OUT: New Exclusive Listing – 173 Units – Pasadena; “Hudson & Walnut” and “El Molino & Walnut”. Click here for more info: http://bit.ly/q0xnrS