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The Costa Mesa company believes theproducg — single family houses — and its locatiohn near Japantown is a good bet. Mark Rowson, Warmington’d Northern California division president, said the development is a uniques one for downtownSan Jose, which has been constructing towering high This project has a suburbahn flavor and features two-story homes, with a smallk yard and two-car garage. The 2,000-square-foot homes will start in the mid- to high The builder will construct four in thefirst phase. In downtowm San Jose, there have been no single-familyy detached homes built in the last few Rowson said. Warmington purchased the 10-acre industrial site in December 2008.
Standard Pacific Homes had an option on the land in 2006 at the top the markeg and began work onthe project. But Standard walkedf away when the market soured and creditbecame unavailable. The property reverteed back to theoriginal owners, San Jose Property Investment LLC and DAK, a Californi general partnership. Warmington bought the land from San Jose Properthy Investmentand DAK. The company has an agreemenft with the original ownerss to develop the propertyin phases. “This is an extende build-out, it’s not a said Matt Tingler, Warmington’s executive vice president. “We’ree very sensitive to oversupply.
” Irvine-based Standard Pacificv Homes, a major developer of projects inthe hard-hit Central Valley, did not return calls seekinyg comment. Tingler would not disclose thepurchasee price, but he made it clear the builde is operating as economically as possible. “Sincwe approximately 2006 we stopped buying land and resolvefd to sell through our existiny portfolioof projects,” Tingler said. “We have a handfup of projects still remaining thatare But, since we never overextended during the boom, we now have fewere troubled projects to work through.” This most recent acquisitio n comes at an opportune time for Warmington.
The company has trimmer its portfolio from 30 projectsto five, a numbere Tingler said Warmington is very comfortable with. Its determinatio to get lean presents its own Now the homebuilder is almost outof “We sold out of Viridiajn in San Jose and Vantage in Palo Tingler said. “. We had a ton of producft that we movedthrough quickly, and we paid back our Now we’re out of product.” That strategy, is serving Warmington well as it pursuesa its next line — managiny distressed assets for thred banks, Comerica Bank, Guaranty Plus Properties 2 LLC and Bank of Tingler said Warmington starte d chasing the business 18 months ago before the market was ready.
Now there’sx a lot of competition, althoughh little is located in the core Bay Areamarkegt — most is currently in the tertiarty markets in the Central Valley. Warmingtonj competed against other builders for the business that can entaipl everything from securing the property to ensuring therew isno vandalism. “We’re not acting as a we’re not selling the property for the but we can givea builder’s perspective of what it’ds worth,” he said. Warmington is a veteran of such Tingler said, having performed similaer duties during the last major housing recession in the late 1980sa and early 1990s.
The companhy has agreed to sell more than 600 home s in five markets located in Souther California and Nevada for TriPacific CapitalAdvisors LLC. Aske whether the work paid well, he said, “From our perspective, any revenu coming in represents dollars that we would nototherwiss have. The goal is to help our financiakl partners while at the same time generate revenu to helpcover overhead.” It also keepx Warmington abreast of what’s going on in many Rowson said the South Bay has the greatest opportunith for upside. At a seminar there was talk that said the markeftis close, if not at, the bottom.
“Ther Bay Area core markets have the greatesr potential to solidify right now over the next six monthse and then showan uptick,” he said.
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