The work of Jon Jaffe and Emile Haddad in 2005 will be felt for years.
In the past year, the Lennar Corp. executives made big moves to remake large swaths of Anaheim, Irvine and Tustin and started or finished other sizable projects.
Their efforts are expected to bring high-rise condominiums and an urban hub to the area around Angel Stadium of Anaheim.
At the former El Toro Marine base, the executives plan homes, businesses and a grand park. At Tustin’s closed Marine base, they’re building traditional neighborhood homes.
A conservative estimate is that their activities last year could bring 10,000 homes to a county where about 5,000 houses are built a year.
“I consider the two of them to be visionaries, and that’s an understatement,” said Louis Tomaselli, a senior vice president at Voit Commercial Brokerage LP.
The 2005 efforts of Jaffe and Haddad earned them the Business Journal’s annual businesspersons of the year honor.
Jaffe is chief operating officer and No. 2 at Miami-based Lennar. Haddad is president of the company’s West Coast operation. Both work from Lennar’s regional headquarters in Aliso Viejo.
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Rendering of Lennar’s A-Town: plans approved in October |
Top Developer
With projects in Anaheim, Irvine’s Great Park and Tustin, Lennar has emerged as one of the pivotal developers here, alongside The Irvine Company and Rancho Mission Viejo LLC.
“Jon and Emile consistently provide thoughtful leadership and foresight for Lennar,” said Joe Davis, president of Irvine Community Development Co., the Irvine Co.’s residential arm. “They are a great company that we’re very familiar with from all of their experience in Irvine and on the Irvine Ranch. We’re confident they will do a great job in developing the Great Park.”
Lennar’s banner 2005 is remarkable for a company that entered California homebuilding in 1996. As recently as 2004, the company only built about 260 OC homes, placing No. 14 among local homebuilders, though Lennar was among the largest builders in California that year.
“I’m very excited about what we’re doing locally,” Haddad said. “What’s important is that each of these opportunities provides housing in the heart of Orange County. And it is at a value that’s going to give a lot of people the chance to live here.”
A recap of 2005 for Jaffe and Haddad:
– In February, Lennar and its investment partners, operating under the Heritage Fields LLC name, acquired 3,700 acres of land at the former El Toro Marine base for $650 million. The company is set to pay an extra $400 million to Irvine in development fees and for roads, sewer lines and other basics.
The site is zoned for about 3,600 homes. Lennar expects the first homes to finish in 2008. The site also includes more than 1,300 acres of public land to be developed as the Great Park.
– Also in February, Lennar got approval to build about 2,000 homes at the former Tustin Marine base. Lennar is developing two neighborhoods along with Newport Beach-based William Lyon Homes Inc. The first homes are under way.
– In March, the Business Journal broke news about Lennar’s plans for remaking the area around Angel Stadium. Jaffe and Haddad paid top dollar for industrial buildings around the stadium as they worked with the city on a redevelopment area known as the Platinum Triangle.
– In October, the city OK’d Lennar’s plans for A-Town, a 2,681-home development including up to 14 condo towers. One proposed 38-story high-rise would be the county’s tallest building.
“We’re running out of land. There’s no choice but to go higher,” Haddad said.
– In April, Lennar started razing buildings at Parker-Hannifin Corp.’s former Irvine campus as part of its plans for Central Park West, a 43-acre project of 1,400 homes, including high-rise condos, offices, shops and parks. Some homes are due this year. The towers are set for 2007 and 2008.
– In July, Lennar and Santa Ana’s Urban+West+Strategies started building the Santiago Street Lofts, a condominium and office project across from Santa Ana’s train station. The development was the first of what’s now a handful of projects bringing homes next to train stations in the county.
– In November, Lennar laid out a vision for other uses at El Toro, including a college campus, an elevated people mover and a cooking school. Parks, wilderness areas, farms, museums and a cemetery also are planned for the former base.
Lennar’s plans are set to remake a big slice of the county. Jaffe and Haddad stand to be the driving force behind the county’s next stage of development, as Donald Bren, Henry Segerstrom and Rancho Mission Viejo’s Tony Moiso did before them.
The El Toro project puts Lennar in close contact with Bren and the Irvine Co., the county’s dominant real estate player and owner of land around the former base.
Lennar has built homes at Irvine Co. developments and held talks with the company as part of its research on El Toro.
Jaffe and Haddad said they don’t see a shift in the housing market scuttling their big plans. They said they expect demand for housing to hold with continued job growth.
“Growth will continue here,” Jaffe said. “You’re going to see more mixed-use development, and more high-density development.”
Then there are demographics. Baby boomers are retiring and finding their traditional homes too big. Condo towers appeal to them and young professionals, according to the Lennar executives.
OC “is not a bedroom community any more,” Haddad said.
Jaffe and Haddad surprised many with their swiftness in going after projects, such as A-Town and Central Park West.
“What’s most impressive to me is that as large as Lennar is, (Jaffe and Haddad) can still move like entrepreneurs,” said Voit broker Tomaselli, who worked with Lennar on assembling the land for the Anaheim project. “You expect big companies to move slowly. But they’ve been able to green-light projects very quickly.”
Lennar is the nation’s No. 3 homebuilder by homes built and market value, behind D.R. Horton Inc. of Texas and Michigan’s Pulte Homes Inc.
Nimble Culture
The company’s culture allows for quick moves, according to Haddad. Lennar isn’t big on hierarchy and formality.
Jaffe and Haddad, as well as everyone else in Lennar’s Aliso Viejo office, wear nametags with no titles.
Lennar takes risks and is open to ideas from employees, Haddad said.
“That’s the key to our success. Employees are emboldened and encouraged to try something new,” he said.
“The problem of the corporate world is that employers approach business defensively and are afraid to make mistakes. We celebrate our mistakes.”
Jaffe and Haddad have worked together at Lennar for the past 10 years.
“No one is going to look at us and say we’re cool,” Jaffe said. “You won’t see us going on a surfing junket to Fiji.”
Outside the office, dinners with friends and family events are the norm.
Haddad is quick to share credit for Lennar’s epic 2005.
“Jon and I would both tell you that we’re representing thousands of people who deserve the credit,” he said. “The stage for these deals wasn’t set overnight.”
Eyeing Incremental Gains
Jaffe and Haddad said they’re looking ahead to more gains in 2006, albeit different ones. This year is set to be one of progress on the big projects that were laid out in 2005.
El Toro is moving just past the acquisition stage with a lot of planning and approvals yet to take place. The A-Town project is slightly ahead of El Toro with early work now taking place. Lennar bought some 30 industrial sites last year that still need to be torn down. That could come this month.
Central Park West, meanwhile, should start construction soon after demolition, grading and other early work took place in 2005.
The Villages of Columbus at the former Tustin base are in the early stages of construction.
“Acquisitions are the sexiest part of the development process. But if you don’t execute, the next acquisition will be tougher to get done,” Haddad said.
