Highpointe Sells Temecula Property for $40 Million
By DANIEL D. WILLIAMS
Highpointe Communities Inc., a Laguna Woods-based residential land developer, has sold a 478-acre land parcel near Temecula for $40 million.
New owner National City-based Corky McMillan Cos. plans to move forward with Highpointe’s initial Morgan Hill development,a 1,126-home masterplanned community.
Before Highpointe could make the sale, the company needed to clear zoning issues with Riverside County officials, the city of Temecula and residents of nearby rural areas, according to Highpointe Chief Executive Steve Vliss.
Highpointe bought the Temecula land in 1998.
“When we bought the land, it had 85,000 citrus trees (on 500 acres),” Vliss said.
Highpointe became a citrus farmer during the four-year entitlement process.
“We do whatever it takes to squeeze a few bucks,” Vliss said.
But Vliss said the Southern California citrus market isn’t what it used to be.
“It was a means to an end and never was intended as a long-term goal,” said Vliss, the former president of KB Home’s homebuilding and development unit for the Inland Empire and onetime board member of the Building Industry Association.
Temecula residents, who didn’t want the green citrus groves exchanged for red rooftops, spoke out against the project.
Inland Empire Supervisor Bob Buster led a drive to reduce the number of homes planned by 22% to 1,126. And Temecula’s City Council threatened a lawsuit, fearing the Morgan Hill community would clog traffic along Highway 79.
Highpointe agreed to pay $1.2 million to Temecula, with the money used to widen 79 South and upgrade the interchange with Interstate 15.
“Even though we were out of the city, we felt we couldn’t ignore their concerns,” Vliss said.
Temecula Mayor Jeff Comerchero called the payment “a groundbreaking deal.”
The final plans for Morgan Hill include an elementary school, two parks and about 100 acres of open space, according to Vliss.
Highpointe initially planned to develop the land itself. But then the company decided to put the land on the market to see what kind of interest it would generate.
Corky McMillan was coming off the development of Temeku Hills, a Temecula-area golfing community, and felt bullish about the region.
Corky McMillan also developed the masterplanned communities of Rancho del Rey in Chula Vista and Scripps Ranch Villages in San Diego.
Today, the citrus trees still stand, but not for long. McMillan will begin grading before the end of the year, according to Vliss.
Southeast of Temecula, Morgan Hill is bordered on the north and west by the Redhawk masterplanned community and on the east and south by big-home neighborhoods. The land is near both Temecula and Murrieta and is part of the San Diego commuter market, according to Vliss.
Since forming in 1997, Highpointe has bought more than 7,000 home sites. It currently owns six projects with more than 2,700 homes in various stages of development in Orange, San Diego, Riverside and San Bernardino Counties.
Highpointe plans to use money from the Temecula sale to develop more projects in the area.
It also has plans for a hotly contested 15-home site on 225 acres in Laguna Beach. The company wants to build the homes on 10 acres of the property and dedicate the balance to a natural preserve.
“But it’s a long way from a done deal,” Vliss said.
