Meritage Homes appears to be a move-up buyer when it comes to development sites on one street in the Irvine Business Complex.
The Scottsdale, Ariz.-based homebuilder recently completed the sale of 17821 Gillette Ave., a nearly 2-acre site about a mile from John Wayne Airport and near the intersection of Main Street and MacArthur Boulevard.
The property previously held a 20,000-square-foot industrial building. Readers may remember it from a feature I wrote in February on Ted and Rae Segerstrom and their collection of vintage cars, primarily Ford Mustangs and high-performance Shelby and Shelby Cobra models, that were previously housed at the Irvine property.
The industrial building is making way for a 39-unit attached townhome project of units ranging from 1,597 square feet to 2,000.
Meritage Homes bought the building last year from the Segerstroms for a reported $8 million. Last month it resold it to Newport Beach-based Intracorp Cos. for $11 million, or roughly $282,000 per lot, according to brokers with Tierra Development Advisors.
Tierra’s Guillermo Monge, Roland Chavez, Brandon Johnson and Bret Rosol represented Intracorp in the transaction.
It’s Intracorp’s second reported acquisition of a for-sale residential development site in the IBC over about the past six months. Late last year it bought the Irvine Gateway development site on Von Karman Avenue about a mile from the Gillette Avenue property.
That 3.4-acre site near the intersection of Von Karman and Alton Parkway is entitled for 71 townhomes. Intracorp paid about $17.5 million for it, or nearly $250,000 per lot.
Intracorp is looking at other sites in the IBC for for-sale residential units, said Tierra Vice President Monge.
The limited amount of for-sale housing in the immediate area is experiencing strong sales, Monge said. Lennar Corp. kicked off sales this month of high-end townhomes at its Central Park West development just off the San Diego (405) freeway. The homes are priced over $1.2 million, and at least five sales have been made this month, according to the Miami-based builder, which runs much of its operations in Aliso Viejo.
Meritage remains active in the IBC after its sale of the 39-unit site. This month it bought a larger development property, also on Gillette Avenue. CoStar Group Inc. records show Meritage paid $10.1 million for 17817 Gillette Ave., another industrial building next-door to the property it sold.
The building will make way for a 75-unit condominium project, according to brokers with Irvine-based Land Advisors Organization who worked on the sale.
Meritage bought the site from an affiliate of Ranco Realty Group in Mission Viejo, property records show. It sold for about $135,000 per lot and changed hands before the city of Irvine approved final entitlements for the site.
“There is an increasing buyer demand for new homes in this infill neighborhood, with limited land available to develop and/or expand new residential projects,” said Land Advisor’s Mike Hunter, who worked on the 17817 Gillette transaction with colleague Allison Tift.
“This project will help create supply to meet the housing demand.”
Flea Market Conversion
Irvine-based apartment developer Western National Group has a big multifamily development project in the works in downtown San Jose.
The company plans to turn 6.5 acres into a project featuring 551 apartments and 37,000 square feet of commercial space.
The site would replace a surface parking lot now used for the San Jose Flea Market, which would be demolished for the development, according to city filings.
Western National has received a $31.5 million loan from Preferred Apartment Communities Inc. to fund the acquisition of the land and to finance part of the construction cost, according to the Atlanta-based company.
Western National has “been such an important part of the multifamily business for so many years and (we) hope this is just the first of many high quality projects that we can work on together,” said John Williams, Preferred Apartment chairman and chief executive.
