One of Orange County's last large plots for housing development has been sold to a national home builder that plans to restart the partially completed community, which became a symbol of the housing crash.
The sale of Pacifica San Juan, perched on the hills of San Juan Capistrano, underscores a hot luxury housing market in the region. A rising stock market and an influx of foreign buyers have the high-end housing market humming, real estate consultant John Burns said.
"There is a lot of money pouring into the county," he said.
Taylor Morrison Home Corp., along with two partners, scooped up nearly 200 acres and 318 home sites at Pacifica San Juan from failed financier Lehman Bros. late last month. The group, which includes Oaktree Capital Management and DMB Pacific Ventures, paid about $150 million, said Phil Bodem, Taylor Morrison's Southern California division president.
The Arizona company plans to start construction on the first batch of houses by the end of this year, with sales opening up next spring. Bodem said the upscale, gated community probably will be finished by the end of 2018.
"We are going to get things started as soon as we can," he said.
Irvine developer SunCal debuted Pacifica San Juan's first homes in 2006. The project soon stalled with the collapse of investment bank Lehman Bros.
Only 98 of the 416 planned homes have been built, and the development has stood as a reminder of the financial crisis that turned housing projects into ghost towns across Southern California. Homeowners who arrived in the beginning were in for a shock.
Residents recalled that outsiders used their community to dump trash and teenagers partied in unfinished areas. The former president of the homeowners association said residents had to fight to keep street lights on and get the promised security gates installed.
"Everybody just banded together and did the best we could," said Stacy Baumann Tran, who lived in Pacifica San Juan from 2007 to 2012.
Paul Jenkinson still lives there. He said that things improved in recent years after the project exited bankruptcy.
Today, expansive million-dollar homes sit on well-kept streets. The Pacific Ocean can be seen in the distance.
Nearby, vacant lots sit covered with brown brush and a smattering of yellow wildflowers.
On a recent morning, two young children darted through the vegetation. Their nannies kept watch, a sweeping view of Dana Point Harbor at their backs.
"We call it the empty street," nanny Araceli Solano said as a breeze rolled in off the ocean. "This is our park."
But with the housing market's upswing, projects are being revived. Taylor Morrison recently started construction on another failed SunCal-Lehman project: a community slated to contain 309 luxury single-family homes on a seaside bluff in San Clemente, known as Marblehead.
About half of Pacifica San Juan's new homes are expected to be priced less than $1 million, with the others fetching $1 million to $2 million, Bodem said. A recreation center and pool are planned.
The project's rebirth represents the closing of an era for Orange County. The land is one of the last swaths of developable space by the coast. Even inland, few sites remain for sprawling communities.
"Orange County," housing analyst Steven Thomas said, "is running out of space."