Prices for prime residential land continue an upward trend in central Orange County, approaching $8 million per acre at one of the market’s key master-planned developments.
The price update came in the latest quarterly earnings call of publicly traded FivePoint Holdings, the Orange County Business Journal reported. The Irvine-based master planner of the Great Park Neighborhoods took in $96.1 million on the sale of 105 homesites on 12.3 acres of land to a single builder there last quarter. That works out to $7.8 million per acre.
FivePoint said the sale, which came to $900,000 per homesite, provided a 70 percent profit margin. The company did not identify the buyer.
FivePoint CEO Dan Hedigan attributed the healthy price and margin to improving market conditions as well as a greater leeway for other developers and builders to pursue their own designs on new construction.
“We’ve begun allowing builders to design the home programs in our communities, (and) this change has contributed towards the higher land residual values for us,” Hedigan said on the call.
Hedigan said the second quarter laid the groundwork for a big pending sale in addition to the done deal.
The ongoing momentum on land sales in Irvine builds as FivePoint hits another hurdle in a long line of stumbling blocks at another development site envisioned for a master-planned community. The challenge came at its Hunter’s Point Shipyard property, planned as a redevelopment of an old U.S. Navy shipyard.
The U.S. Navy recently said recent soil samplings uncovered a couple of small items that were radioactive on the Hunter’s Point site, which is currently undergoing environmental remediation. The discovery likely means an 18-month delay on the current timeline for the project, which has been pushed back a number of times over the years and now looks to be on hold until 2027 at the earliest.