RESIDENTIAL
Lennar Corp. has hit the reset button on its Central Park West housing project in Irvine.
The Miami-based builder, which has major operations in Aliso Viejo, is taking the wraps off the 43-acre project that runs along the San Diego (I-405) Freeway and Jamboree Road some two and a half years after the first batch of homes were built at the site.
The project—a former Parker Hannifin Corp. industrial site that Lennar bought for a reported $100 million—held its official re-opening over the weekend, although it’s been giving tours to potential buyers the past few weeks.
“It’s been a long time coming,” said John Baayoun, president of Lennar’s California Coastal homebuilding division.
Central Park West, which will hold about 1,380 homes when fully built, was the largest partially built housing project in Orange County to be mothballed during the housing downturn.
Sales were halted at the project in late 2007, with officials opting to wait until the housing and mortgage markets showed signs of recovery.
The company’s betting that now is the time to try again. They are pitching 256 townhomes and midrise condominiums that have been completed at the project, in addition to a pair of high-rise condo towers that also are on the site.
“Everyone has a much more positive outlook on the economy,” Baayoun said.
The builder’s been keeping close tabs on the new home sales elsewhere in Irvine.
Newport Beach’s Irvine Company has reported some 420 homes sold so far this year at Woodbury and Woodbury East—its first big housing project in several years that’s just a few miles from Lennar’s homes.
Lennar sees its Central West project as a more “fresh and edgy” alternative to the homes being built in Woodbury and thinks the project’s location near John Wayne Airport will attract buyers looking for a more urban setting, Baayoun said.
New prices might also attract buyers.
Central Park West counts six different home types. When the first batch of homes was under construction, three of the six models had starting prices cracking the $1 million mark. Two other home plans started in the $700,000s, according to Irvine-based Hanley Wood Market Intelligence.
Now, the most affordable condos start in the upper $300,000s, with prices for more upscale townhomes and “luxury flats” starting in the low- to mid-$600,000 range, well below previous expectations.
A timeline for construction for the rest of the project will depend on how sales go and could take a little more than two years to complete, according to Baayoun.
COMMERCIAL
A troubled loan tied to an Irvine office that previously housed some of the local operations of Washington Mutual Inc. is on the auction block this week.
Irvine-based property auctioneer Real Estate Disposition LLC and Chicago-based brokerage Jones Lang LaSalle Inc. are looking to sell off a bad loan that’s secured by 17861 Von Karman Ave., a single-story building just off Main Street near John Wayne Airport.
Some of Washington Mutual’s insurance services had been operating out of the 44,850-square-foot office building, which now is vacant.
WaMu was acquired in late 2008 by JPMorgan Chase & Co., which recently consolidated local operations nearby in Irvine.
Bids for the lender-backed sale have to be in by Thursday, according to brokers marketing the property at Jones Lang LaSalle. The starting bid is $2.5 million.
The loan had an original balance of $9.8 million. It now has a balance of $7.3 million. The loan is set to mature in late 2017 and carries an interest rate of 6.28%.
The Von Karman building’s next to, but isn’t part of, the 414,000-square-foot Quintana office campus that was WaMu’s local hub. The bulk of that campus, last owned by MPG Office Trust Inc.—formerly Maguire Properties Inc.—is in receivership.
The auction is one of the more high-profile local deals taken on by Real Estate Disposition and Jones Lang LaSalle since the two companies teamed up late last year to auction off distressed commercial real estate properties online.
Buchanan Buy
Newport Beach-based real estate investment management firm Buchanan Street Partners has made one of its larger local acquisitions of late, getting in on a $40 million buy of an industrial and office complex in Hawthorne.
Buchanan Street and Los Angeles-based Zelman Development Co. bought 1.4 million square feet of industrial, office and manufacturing space in Hawthorne’s Century Business Center.
The sale involves one five-story, 254,000-square-foot office building and six industrial manufacturing buildings, including a 1 million-square-foot facility used by Vought Aircraft Industries to make fuselage panels for Boeing Co.’s 747 planes.
The buildings were sold by Los Angeles-based Kearny Real Estate Co. and a fund managed by Morgan Stanley.
Buchanan Street invested $10.2 million in the deal.
