Hat tip to RE for sending this along, from the U-T:
The 211-acre western half of Carlsbad’s Robertson Ranch has been sold for more than $30 million to Los Angeles developer Shapell Homes in a sign of a revival of home building in San Diego County.
Shapell plans to build 680 homes, starting in late-2013, on the property is located north of El Camino Real, west of Cannon Road and south of Tamarack Avenue on the eastern side of Carlsbad.
The transaction, recorded last month was between Robertson family members and their family trust and Rancho Costera LLC, the Shapell entity involved, the county assessor’s office said. The value was not disclosed but the transfer tax indicated it was about $37.4 million. Shapell said the price was less than that but more than $30 million.
“This is a significant commitment for our company,” said Shapell CEO Matt Koart, “and we intend to add to Carlsbad’s already fantastic reputation and sense of community.”
Christer Westland, a senior planner with the city of Carlsbad, said the ranch masterplan, which calls for 1,112 homes on nearly 400 acres, divided the Shapell land into 22 planning areas. The include locations for single-family homes and apartments or condos, a 15-acre commercial center, 13.5-acre park and 6.8 acre site for an elementary school. About half the land is to remain in open space. He said Shapell will now need to process individual subdivisions and gain design approval.
“It’s important to Carlsbad,” he said. “It seems to be an indication that things may be turning around.”
Peter Dennehy, an expert on San Diego development with John Burns Real Estate Consulting, said the eastern part of Robertson Ranch is being developed as The Foothills by Brookfield, D.R. Horton and William Lyon home builders with the first residents having moved in this past summer.
“It’s a great location for housing,” Dennehy said. “It’s been reasonably well accepted, though the market still struggles.”
Shapell, which has built off and on in San Diego County for decades, is a privately held, Beverly Hills-based firm that tends to buy land for the long term and build its own projects rather than selling off land to merchant builders, Dennehy said.
“They’re not just jumping into something that they need to develop in 12 months,” he said. “That’s one way a builder like that can compete with public builders,” whose shareholders expect quick profits.
Erik Pfahler, Shapell vice president for planning and land acquisition, said the company had little competition in bidding on the land, since much needs to be done to get final approval and install infrastructure.
“We’re hoping to begin grading in the first or second quarter of 2012,” he said, with the first homes likely to be for sale in the third quarter of 2013.
He said the company decided to move now because it feels the housing market will be relatively strong in three years.
“We’re optimistic by definition and I think we feel this is a pretty good place to be cautiously optimistic,” Pfahler said.
He said the single-family homes will likely range from 1,800 to 4,000 square feet and the townhomes from about 1,400 to 1,800 square feet. A senior housing project, probably for rent, also is expected.
“What we’ve planned going in is to feel the market out and build a home that the community wants and what we planned going in on this acquisition is a moderate-sized home for the lot size.”
He added, “We’re not ones to mansionize the lot.”
Shapell’s last project in Carlsbad, an apartment development, was built 15 to 20 years ago, he said, and more recently was active in the Torrey Highlands area of Carmel Valley east of Del Mar.
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What about those of us who want more?
I don’t know these guy’s but I would bet they will build what ever gets them the most money per dollar invested.
Personally I like my Mc-mansion. I think in California they make a good fit as the utility bills are not near as severe (hot and cold) as most other parts of the country, well at least in coastal and semi-coastal Socal.
But to each their own.
Also in today’s U-T:
http://www.signonsandiego.com/news/2010/dec/01/carlsbad-golf-course-receive-17-million-subsidy/
The Carlsbad City Council unanimously agreed on Tuesday to subsidize the city’s cash-strapped golf course by $1.7 million for the upcoming year after receiving a report that indicates the course’s financial picture is improving.
They won’t mansionize the lot – just up to 4,000sf houses only.
“a moderate-sized home for the lot size”
Oh,
yea I thing you would need at least a 7000 to 8000 sqf lot for a 4000 sqf home,
Less then 6000 sqf and it looks like a condo complex.
$37.4 million seems like a bargain.
680 houses with an average selling price of $500k = $340 million
I don’t see why they would need to wait for the housing market to be “better.”
On paper the price looks right..not too low, not too high.
Its an average of $45-50k/lot plus the commercial for free.
Typically a builder will pay something on the order of 10% of the finished home value for unimproved lots (remember they need to install all the infrastructure, roads, sewer, pay school fees, permits, etc which could run north of $100k/lot). Thus they should be fairly solid around $500k average. However, they have a lot of planning/entitlement expenses and a few years of holding costs and interest carry plus investment carry.
Thus a pretty fair deal.
I also agree with their assessment that they didn’t have lots of competition as it is true that the big builders want fully approved deals ready to go…then they’ll pay nicely for it…but they’ve learned they are builders, not developers so they don’t want to process maps/entitlements…just build.
What do you think of this $2 billion development?
http://www.signonsandiego.com/news/2010/dec/01/civita-begins-mission-valley/
what if they find some endangered species on the property and they cant build?
joe – that stuff has already been 90%+ studied and worked out/resolved during the initial master planning phases. Anything found now can be mitigated.
this plan has been moving through the process for over a decade.
With a nasty winter in the rest of the country….build it and they will come… again…please Jerry….don’t mess it up again…ok?
If half of the 211 acres is open space, that leaves about 106 acres for 680 homes, or about 6700 sq ft per lot. That’s a pretty packed in community, maybe even more than 4S ranch.
JTR – that project in MV is a head scratcher to me. I am sure it makes sense on paper, but seems to be creating too much supply (albeit over a long period of time).
I have a feeling it will take 2x as long, and be 1/2 as successful as planned. However, the land owners will make out huge as they have held that land forever and I assume have about a zero basis. Smart land guys always make out big in deals like this.
Mainly because the guy in the article was so full of superlatives and hyperbole that it had my head spinning. Seems to be trying too hard to make a bunch of condos packed into a congested area something more that it really is.
Besides, anything south of the 56 Freeway is like another state to me.