Irvine Co. Seen Concentrating on Apartments : Speculation Centers on Layoffs, Sale of Tracts
The just-announced layoff of 10 of the Irvine Co.’s residential project field managers and the sale of five of the company’s housing project sites earlier this year have real estate industry experts speculating that the Newport Beach-based land developer wants to get out of the home construction business in favor of building apartments and condominiums.
The layoffs occurred in the Irvine Co.’s residential development arm, the Irvine Pacific Co. A spokesman for the Irvine Co. said no further layoffs are expected anywhere in the firm, which laid off 240 employees in July.
A spokesman attributed the cutback of its Irvine Pacific Co. staff to a lack of replacement projects for those that are nearly completed. The Irvine Co. also said it will hire 20 employees for its expanding apartment management division.
Martin A. Brower, who resigned two years ago after 12 years as the Irvine Co.’s director of public relations, speculated that the development company “is going out of the business of building single-family housing . . . to concentrate on the apartment operation.” Brower presently is publisher of a monthly newsletter on Orange County business.
5 Project Sites Sold
In September, the Irvine Pacific Co. sold a total of five housing projects in Orange and Irvine, saying that escalating building costs had pushed housing prices beyond the $150,000 range of the entry-level home buyers the developments were designed to attract.
In July the development company released about 240 workers as part of a reorganization of the firm, which includes land management and development and community development divisions.
Sanford Goodkin, president of the Goodkin Group, a La Jolla real estate marketing and consulting firm, said that the newest layoffs “are not a sign of growth” and that he suspects they are a “part of a decision of strategic cutbacks” for Irvine Pacific while the parent company expands its apartment-building division. “Apartments you can pre-sell. Apartments become more important as housing (prices) go up,” Goodkin said.
