Orange County’s biggest homebuilders are again turning more of their attention to projects in the Inland Empire.
“Historically, that marketplace (sold about) 30,000, 40,000 new homes a year in the early 2000s,” said New Home Co. Chief Executive Larry Webb. “It is way below that today.”
There are signs of momentum, though.
Sales of new and existing homes in Riverside and San Bernardino counties were up 3.8% and 4.6%, respectively, last year, according to data from Irvine-based CoreLogic Inc.
Webb was one of several local housing execs who cited the Inland Empire as an area anticipated to experience an increase in new-home sales as they talked about the near future during their latest round of quarterly earnings calls in late February.
Aliso Viejo-based New Home Co. has a new project in the works in Corona, marking its first development in the Inland Empire.
“We believe that the western Inland Empire offers a great opportunity for us,” Webb said.
New Home Co. bought the land for the project, called Arantine Hills, in 2014 but has since kept it under wraps.
It’s now aiming for a 2018 opening, the company said. Development plans call for more than 1,400 homes upon build-out. New Home Co. plans to sell some land to other builders while keeping a portion of the development for itself, Webb said.
A number of land deals made in 2013 and 2014 that included sites in the Inland Empire were probably made a bit too early in the housing recovery, said William Lyon Homes Chief Executive Matt Zaist.
Some deals the Newport Beach-based builder made around that time “had a fair amount of exposure to the Inland Empire, and we saw what happened when that got pulled back (amid a slowly recovering housing market),” Zaist said.
Sales there have lately been picking up, though, Zaist told analysts last month. William Lyon Homes is selling homes at seven projects in the Inland Empire with starting prices ranging from about $300,000 to $500,000, according to its web site.
“Sales activity (in that market) has significantly increased across all price points, albeit at lower margins than the company average,” Zaist said. “Our strategy is to continue (to) push through these assets which should be helpful to our long term goals, but will result in near term margin pressure.”
Irvine-based TRI Pointe Group Inc. is selling at seven locations in Ontario and Corona, where its most affordable homes start at around $350,000.
“We have probably some of the lowest priced offering in the core market of the Inland Empire available,” said TRI Pointe Chief Operating Officer Tom Mitchell.
“We feel really good about that, and we have already seen that implemented to date with phase-to-phase increases on a regular basis,” Mitchell said.
Keeping prices below the Federal Housing Administration loan limit for the Inland Empire—now about $424,100—is a big help for selling homes in the region, TRI Pointe officials said.
Spectrum Loan
Newport Beach-based Irvine Company has lined up some new financing for a dozen buildings it owns in the Irvine Spectrum, according to property records.
The privately held real estate company, which is the dominant owner of buildings around the Spectrum shopping center, which it owns, recently completed a $91 million financing deal with Great West Life & Annuity Insurance Co. and London Life Insurance Co.
The funding covers the multibuilding office campus that holds the headquarters of Irvine-based Blizzard Entertainment, plus the eight-building Jenner Business Park, a multitenant office campus next to the main Blizzard campus at the intersection of Alton Parkway and Laguna Canyon Road.
The buildings involved in the latest financing deal total about 500,000 square feet in a mix of single-story and multistory offices.
It’s not known whether Irvine Co. already had debt tied to the properties; terms of the financing deal were not immediately disclosed.
