COSTA MESA, CA-“I believe that we're in a land-grab market right now; builders, whether public or mid-size regionals or family shops, are all looking to buy land and they're all looking to buy entitled land.” So says Rick Fletcher, VP of sales and marketing at MBK Homes, which, as GlobeSt.com reported earlier today, just broke ground on Sea House, an innovative home-design concept here involving three-story detached homes.
Sea House was a concept that MBK had purchased, with the architecture already designed. “The land seller, I believe, was very successful in designing a high-density, detached product that would fit into the existing aesthetic of west-side Costa Mesa,” Fletcher tells GlobeSt.com. “That particular part of Costa Mesa has a lot of industrial and industrial offices as well as some small businesses. Sea House has the contemporary look [that fits that aesthetic].”
Fletcher says the density is what drove Sea House's design. “It's among the highest-density detached projects that anybody is building in Orange County.” The buyer benefits by not having common walls and having natural light, he adds.
The project targets those who already have an established element of their lives in this part of the county. “We think that the people who will be particularly interested in this community already have a social fabric, a lifestyle here—Newport Beach, Costa Mesa, Newport Mesa—and they're already used to coastal Orange County,” says Fletcher. “It could be where they where they work or where they like to hang out on weekends. Because of the look and price point, it will appeal to the younger professional, the Millennial, Gen-Y buyer who, thanks to the economy being up and running is earning good money and wants to buy a house.”
Purchasing entitled land with the architecture in place dictated the type of project Sea House will turn out to be. “When you have land with entitlements, you already have a tract map and there's already product designed,” Fletcher says. “It's more so than saying, 'I want to build in Costa Mesa for Millennials.' The predecessor is, where is the available land? Based on the entitlement project of that site, builders are getting very scientific and creative about identifying who that demographic is. If they can meet those needs in the design of the architecture, then great. If not, then they will make some tweaks and changes to meet those needs. Builders will go where the land is.”
Regarding Millennials buying homes, Fletcher says that 50 million Millennials have expressed a desire to buy a home within the next two years. “With 80 million Millennial and Gen-Y potential homeowners in the country, there are enough of them for both the residential and multifamily sectors. That particular demographic will probably rent at first and then may decide to move on to homeownership. Many of them will decide to continue renting.”
It's more about location, lifestyle and life experiences for this cohort than it is about personal possessions and acquisitions, Fletcher adds. “So, if builders are building in the right location, they'll attract this buyer, and Costa Mesa is the perfect example of that. If you're building in a greenfield 30 to 40 miles away from art, culture and the beach, you may not see that buyer; they may choose to rent closer in.”
Want to continue reading?
Become a Free ALM Digital Reader.
Once you are an ALM Digital Member, you’ll receive:
- Breaking commercial real estate news and analysis, on-site and via our newsletters and custom alerts
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
*May exclude premium content© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
Carrie Rossenfeld
Carrie Rossenfeld is a reporter for the San Diego and Orange County markets on GlobeSt.com and a contributor to Real Estate Forum. She was a trade-magazine and newsletter editor in New York City before moving to Southern California to become a freelance writer and editor for magazines, books and websites. Rossenfeld has written extensively on topics including commercial real estate, running a medical practice, intellectual-property licensing and giftware. She has edited books about profiting from real estate and has ghostwritten a book about starting a home-based business.
