A Land Repositioning Made to Order
HIGHLIGHTS
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Repositioning of ten-acre, former shopping center site in San Jose
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Created structured, orderly disposition process that focused demand, while demonstrating seller commitment
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Obtained winning bid that represented significant value enhancement for seller, and fair market price for buyer
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Winning bidder, Toll Brothers, will build approximately 200 townhomes and condominiums at Willow Glen Place
In its day, Hacienda Garden Shopping Center on Meridian Avenue in San Jose was a busy hub of activity. One of countless small shopping centers in the Bay Area designed to bring convenience to California’s carefree suburban lifestyle, Hacienda Gardens offered a medium-sized anchor retailer, supermarket, and a number of specialty retailers to shoppers in a sunny outdoor setting.
But that was in the 1960s, and by 2005 — with the growth of major regional malls such as Valley Fair and Oakridge — time had passed Hacienda Gardens by.
CHALLENGE
Surrounded by well-kept residential neighborhoods, Hacienda Gardens was ideally suited to be repositioned for high-density residential. The owners — KT Properties joint venture of Cupertino — decided to divide the old shopping center into two parcels. On one parcel, KT Properties plans a major renovation to transform the property into a master-planned, mixed use development. The northerly ten acres at Foxworthy and Meridian Avenues were put on the market for homebuilders.
Borelli Investment Company was one of a number of brokers that began working with KT Properties to find a buyer for the property at a price that would benefit both the buyer and seller.
Early in the process, a number of brokers and prospective buyers were involved, and rather than generating higher demand, this simply seemed to create more confusion. The risk to KT Properties was that the property would be sold for considerably less than market value.
SOLUTION
Borelli Investment Company proposed a more orderly disposition process that would afford all prospective homebuilders an equal opportunity to bid for the property, while at the same time, demonstrating the owner’s commitment to sell and focusing the demand in a way that would drive the offers to appropriate levels for such a well-located parcel.
Borelli Investment Company prepared comprehensive packages describing all aspects of the opportunity, and submitted the packages to approximately one dozen qualified homebuilders. This gave each bidder a clear sense of the opportunity and a thorough understanding of how the winning bidder would be selected.
RESULTS
Almost one year after beginning to work with KT Properties, Borelli Investment Company’s collaborative efforts to bring structure to the marketing process paid off with a multi-million dollar transaction that represented a substantial value enhancement to the seller — and a good deal for the buyer, Toll Brothers, America’s Luxury Homebuilder.
Toll Brothers is building Willow Glen Place, a community of approximately 200 townhomes and condominiums reminiscent of the California Bungalow style. Each residence features spacious floor plans with luxurious master bedroom suites with walk-in closet and private bath, and kitchens with well-crafted cabinets and granite slab countertops. Community amenities include a pool, spa, gym, and clubhouse — plus a tot playground.
By working closely with KT Properties to create a more orderly marketing effort than the typical land brokerage process, Borelli Investment Company helped close a transaction that was made to order for both the buyer and seller — resulting in another acclaimed Toll Brothers development offering high-quality, luxury housing.