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Taco Bell is looking to move within OC, in the Real Estate column



Anaheim Landowners Could Be Coveted for Their Portfolios


COMMERCIAL

Anyone notice the ad on the back page of the Orange County Business Journal last week?

Hillwood Development Corp., headed by Ross Perot Jr., is promoting and trying to attract tenants to its Alliance Texas masterplanned business park, a 15,000-acre “world-class multi-use development,15 minutes from Dallas/Forth Worth International Airport.”

At least Irvine-based Taco Bell Corp. seems to be safe. Not too long ago, the fast-food company was the subject of a bitter and hard-fought battle between California and Texas, which was trying to recruit the company and all those jobs to Plano, Texas. Everyone in California,from then-Gov. Peter Wilson to officials of The Irvine Company,became involved in convincing Taco Bell to stay.

Today, word on the street is that Taco Bell may soon look to relocate,but not to Texas. Housed in a gleaming high-rise structure in Irvine, Taco Bell, which is looking to reverse a sales slump, is apparently not using much of the space and will be looking for smaller digs somewhere in South County.

According to sources, Layton-Belling & Associates,the owners of Taco Bell’s current home,are working with officials of the fast-food company to find more suitable space. (LBA, in a joint venture with Boston-based AEW Capital Management, acquired the complex as part of its $160 million deal for Shuwa Investment Co.’s 1.4-million-square-foot office portfolio in Orange County. The deal, completed in September 1999, was the biggest that year.)

For now at least, Taco Bell looks like it will remain a California company, despite the flex space going for 58 cents per square foot in Alliance, Texas, and the $109,000 median price tag for a new house there.


RESIDENTIAL

Last week, I mentioned that there seemed to be an increasing interest in new acquisitions by homebuilders that had been active in the recent past but had slowed things down this year. While most of the talk in last week’s column focused on acquiring other homebuilders, firms such as Communities Southwest and SunCal Cos., both of Anaheim, also could draw quite a bit of interest. Both companies have large land portfolios acquired immediately after the recession.

Bruce Elieff, a principal at SunCal, said his firm is not in play, but that doesn’t mean offers wouldn’t be studied.

SunCal controls about 18,000 lots across the state, making it the second- biggest landholder in California (in terms of lots), behind only Mission Viejo-based Lennar Homes. In Orange County, SunCal Cos. controls roughly 2,500 lots.

Given the demand in the market and the location of those lots, Elieff said, he is well aware of what an attractive acquisition target his company is.

“I think we control a lot of lots in the state of California in a lot of very good markets,” he said. “Certainly, most prime markets in the state of California do not have an overabundance of supply.”

And despite the increasingly astronomical prices landowners are asking for their properties, SunCal continues to remain active, both on the acquisition front as well as entitling and developing lots to resell to builders.

In Orange County, the company recently began marketing its Amerige Heights community in Fullerton, which will include 1,250 single-family homes, an 85-acre retail center, a 10-acre elementary school site and possibly up to 200 apartment units on 293 acres of land that formerly housed Hughes Aircraft Co.

SunCal Cos. also is in the midst of getting approvals and developing a recently acquired 489-acre parcel in an unincorporated area of the Santa Clarita Valley. Plans envision a 1,109-unit masterplanned community.

Elieff doesn’t expect to slow his firm’s land-buying activities any time soon, especially in light of economic reports that continue to predict a housing shortage for the foreseeable future in some California markets.

Financing also shouldn’t be much of an issue, given the firm’s proven track record and wide range of contacts, including those with Lonestar, a Dallas-based opportunity fund.

“We use firms like them and other opportunity funds from Wall Street,” Elieff said. “Primarily it’s large institutional capital (funds) that have an interest in developing land in California.

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