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Dana Point Land Sells, Slated for Townhomes

Zephyr Partners, an Encinitas-based real estate development and investment company, has picked up a 9-acre site in Dana Point where it’s planning its first big residential project in Orange County.

The privately held company recently completed the purchase of Doheny Beach Village, a now-vacant development site slated to hold 168 townhomes.

The property, once home to a mobile home park, is near the entrance of Dana Point Harbor at the intersection of Pacific Coast Highway and Del Obispo Street.

Terms of the land sale were not disclosed. CoStar Group Inc. records put an estimated $50 million price on the deal. That works out to about $5.5 million per acre for the property, which has been considered for residential development for nearly a decade.

A venture between Angelo, Gordon & Co. in Los Angeles and Beverly Hills-based Capital Hall Partners, listed in property records as AG/A&M LLC, sold the property.

The deal was brokered by Eric Weitz with the Carlsbad office of Phoenix-based Nathan & Associates.

It is Zephyr Partners’ first notable buy in OC. The residential developer was formed in 2008 by Brad Termini and Dane Chapin.

The company develops and invests in attached and detached houses, condominiums and luxury apartments and has focused on deals in San Diego County since its founding. New projects planned there include The Park, a 14-story condominium and townhome project in Bankers Hill that recently began sales. The estimated $100 million project is scheduled to open in 2017.

Also in the pipeline: The Block, a $250 million high-rise project in downtown San Diego that the company plans to break ground on this year.

The three-story Doheny Beach Village project in Dana Point will feature one-, two- and three-bedroom townhomes and a few thousand square feet of retail space.

A time frame for the project’s opening hasn’t been disclosed by the new owner.

Newport Beach-based Makar Properties once planned a residential development at the site after buying the land in 2004 for $10.1 million, according to CoStar records.

The site once held a 90-unit mobile home park, which was shut down as Makar worked to get the necessary city and California Coastal Commission entitlements for a residential and commercial development.

The project was delayed during the last recession and housing downturn, when Makar and its financial partners also lost ownership of the St. Regis Monarch Beach hotel in Dana Point.

By 2011, the 9-acre site sold for an undisclosed price to an affiliate of Capital Hall Partners, which continued to work on the site’s entitlement issues.

The land was sold to Zephyr Partners with all tentative map and Coastal Commission approvals in place, according to Nathan & Associates’ Weitz, who said he received more than 20 offers for it.

The deal marks another notable sale of a long-stalled land site in South OC’s coastal market that’s entitled for residential development.

Last month a partnership of Scottsdale, Ariz.-based Taylor Morrison Home Corp., Oaktree Capital Management LP of Los Angeles and DMB Pacific Ventures LLC in San Francisco bought the Pacifica San Juan home development in San Juan Capistrano from Lehman Brothers Holdings Inc.

The 194-acre, 318-home site just off the San Diego (I-5) Freeway sits on a bluff overlooking much of San Juan Capistrano and Dana Point and sold for an estimated $150 million.

Oliva, a 40-home project on Del Obispo Street in San Juan Capistrano that’s a little more than two miles away from Zephyr Partners’ new project, opened for sales this spring after litigation issues delayed it for several years.

Aliso Viejo-based New Home Co. bought the Oliva site last year from former landowner Rick Scalzo, who reached a $6.35 million settlement with the city of San Juan Capistrano in 2010 over development restrictions placed on the family-owned land.

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Mark Mueller
Mark Mueller
Mark is the Editor-in-Chief of the Orange County Business Journal, one of the premier regional business newspapers in the country. He’s the fifth person to hold the editor’s position in the paper’s long history. He oversees a staff of about 15 people. The OCBJ is considered a must-read for area business executives. The print edition of the paper is the primary source of local news for most of the Business Journal’s subscribers, which includes most of OC’s major corporate and community players. Mark’s been with the paper since 2005, and long served as the real estate reporter for the paper, breaking hundreds of commercial and residential real estate stories. He took on the editor’s position in 2018.
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