Standard Pacific Eyes MarbleheadREAL ESTATE: Plans to spend $400M+ on land in 12 Sunday, May 6, 2012
Standard Pacific Corp.
• Headquarters: Irvine
• Business: homebuilder
• Founded: 1965
• Ticker symbol: SPF (NYSE)
• Market value: About $1.07 billion
• Notable: targets “move up” buyers
Nearly half of the $66 million spent last quarter went toward land development, according to the builder, whose development expenditures have run from $31 million and $34 million for each of the last five quarters.
Last quarter’s decline in land buys is more an issue of timing, officials said last week.
“It’s not a change in strategy,” Chief Financial Officer Jeff McCall said.
The company expects to spend $400 million or more on land-related costs this year.
Standard Pacific has tended to buy partially developed or undeveloped properties—such as Marblehead—of late. A few years ago a bulk of the builder’s buys was for finished land sites.
Marblehead’s high-end orientation also fits the Standard Pacific mold. About 75% of the builder’s sales last quarter were to “move-up” buyers.
“It’s what we’re good at,” Stowell said.
Standard Pacific reported closing 642 home sales in the quarter for an $8.5 million profit. That compared with a $14.8 million loss a year earlier.
The first quarter of the year is traditionally slow for sales and the toughest time for builders to turn a profit. This year marked the first time Standard Pacific was able to post a profit in the quarter since 2006.
After a strong end to 2011, “the positive momentum has continued into the first quarter,” Stowell said.
Another sign of a possible improvement in the market was reduced reliance on purchase incentives, which officials said are at their lowest levels in three years.
“You won’t find a single incentive on our website,” Stowell said.
Pricing has climbed an average of 1% to 2% at the company’s 160 active communities, according to the builder.
Some higher-end projects are seeing pricing boosts in the 8% range, officials said.
An unspecified community in Southern California has seen pricing upped by nearly $140,000 from earlier levels, according to the company.
Standard Pacific’s website lists eight active projects in OC, including homes in San Clemente, Irvine, Brea and Buena Park.
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