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Monday, Aug 15, 2022

FivePoint Home Plans: Go Big Now, Cheaper Next

As the developer of Irvine’s Great Park Neighborhoods prepares to take the wraps off its latest new, and relatively expensive, homes at its Cadence Park community this month, the company is also proceeding with plans for a 723-home project that could include much more affordable price points.

Aliso Viejo-based FivePoint Communities Inc., the firm overseeing development of the city’s old El Toro Marine base, disclosed additional plans last week about a forthcoming construction phase on a 55.3-acre sliver of land it owns along the decommissioned base’s western edge next to the Eastern Transportation Corridor (133) Toll Road.

Called District 1 West in city planning documents, it was once envisioned for homes, childcare uses and a church.

Under new plans FivePoint has been working on since late last year, the nonhousing elements would largely be scrapped to make way for attached condominiums and some open space for resident uses.

At about 13 homes per acre, or nearly 18 when factoring out the 14 acres to be used for streets, the proposed project would be the densest large-size housing development FivePoint has built at the 2,100-acre site, where the first homes came online in 2013.

Its other three existing communities at Great Park Neighborhoods, Pavilion Park, Beacon Park and Parasol Park, included about 5.5, 4.4 and 8.5 homes per acre, respectively, based on regulatory filings.

The three projects had just over 2,700 homes. Pavilion Park and Beacon Park are sold out, and the 727-home Parasol Park—which opened last year and consists entirely of attached condos, townhomes and paired homes priced from about $600,000 to over $1 million—was about 70% sold late last year.

Cadence Park, which officially opens on March 24, will return stand-alone single-family homes to Great Park Neighborhoods’ offerings, alongside additional attached housing.

Its 1,007 homes are being built on about 103 acres—about 10 units per acre, according to regulatory filings.

Cadence Park pricing hasn’t been announced, but given the size of some of the projects, including a few offerings from Lennar Corp. of around 4,000 square feet, $1 million-plus price tags seem likely for a sizable percentage.

Eight builders paid $475 million for the land, roughly $470,000 per home site, FivePoint said in November.

The five builders that have been disclosed for the project—Lennar, Richmond American Homes, TRI Pointe Group Inc., K. Hovnanian Homes, and KB Home—were among the 30 best-selling homebuilders in Orange County last year, based on this week’s Business Journal list, the centerpiece of our annual Residential Real Estate Special Report.

700 Square Feet?

Stand-alone homes apparently aren’t in the cards for the 55-acre portion of District 1 West being prepped for development, according to public documents and comments at last week’s planning commission hearing on proposed site revisions.

Company executives in documents sent to the city have previously expressed interest in building “a broader range of market rate affordability” in the district.

It’s already built three affordable housing complexes serving older residents and families in projects totaling more than 300 units. Some of the projects were built near the 55-acre development site.

Last year FivePoint Chief Executive Emile Haddad floated the idea of building more affordable condos, some as small as 700 square feet and under $400,000, in upcoming development phases at El Toro.

City filings prepared in advance of last week’s hearings on proposed district changes indicate that the 723-unit project would result in just 1,162 residents added to the area, on the low side for a housing project of that size.

FivePoint has raised more than $2 billion from land sales at Great Park Neighborhoods over the past five years. It’s entitled to build 9,500 homes, plus commercial space, on its land, which largely surrounds Great Park.

Great Park Neighborhoods was the country’s ninth best-selling master planned community last year, with 830 home sales, up 55% year-over-year, according to Irvine-based John Burns Real Estate Consulting.

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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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