By Gabriel Circiog, Associate Editor
San Diego-based Newland Real Estate Group LLC has formed a new joint venture with North America Sekisui House LLC, a division of a major Japanese development company, and has thus acquired the largest operating portfolio of residential master-planned communities in the United States.
The San Diego Union-Tribune reports the deal includes Merriam Mountain, the 2,327-acre project north of Escondido which was rejected in 2010 by the Board of Supervisors. Located west of Interstate 15 across from Lawrence Welk Village, adjacent to Deer Springs Road, the proposed 2,700-home project was rejected after residents expressed their concerns regarding the density of the project and the environmental impact it would have.
The joint venture acquired a total of 28 master-planned communities from the California Public Employees Retirement System, including the Merriam Mountain project. Although terms of the deal were not disclosed, the Wall Street Journal estimates the value of the sale at between $500 million to $600 million. The CalPERS portfolio included a total of 7,654 acres of land for development of around 16,300 homes plus commercial and retail centers.
John Burns, an Irvine consultant on real estate, considers it a huge deal for the industry as the largest developer in the country now has a new capital partner facilitating the availability of lots to the home builders.
Newland Real Estate Group has completed or has under way more than 140 diverse real estate developments, including over 20 million square feet of commercial and retail, and 175,000 residential units.
Newland Real Estate Group will continue its role as developer and manager of all the communities but the plan for Merriam Mountain is currently unknown.
Illustration Courtesy of: www.merriammountains.com