REAL ESTATE : Santa Margarita Co. Industrial Parcels Are Going Dirt-Cheap
Taking a cue from falling Orange County residential property values (raw land is down about 40% from the highs of 1989), the Santa Margarita Co. recently delivered a new price list to industrial land brokers that slashes land prices up to 30%, institutes a bonus program for brokers who bring in buyers and offers full 5% commissions to each procuring broker involved in a transaction instead of splitting the commission.
As part of the program, which expires in April, the giant land development company also will pay the onetime fees for transportation --$9.58 per square foot of building-- that the county charges per building. Brokers who bring in buyers also will be awarded $5,000 gift certificates redeemable in merchandise, travel or other services.
The company, developer of the Rancho Santa Margarita planned community and its 700-acre Santa Margarita Center business and industrial complex, also said it now will subdivide two of its industrial parcels into small lots--ranging from just under half an acre to just over nine-tenths of an acre. Prices for those lots will range from $10.25 to $10.50 a square foot.
The price cuts for large parcels generally roll back prices to 1986 levels of $6.25 to $9.25 per square foot, depending on location, size and zoning.
That makes industrial land prices in the Rancho Santa Margarita business center as low as half that of some competitors--although that probably will change if other industrial land owners find that Santa Margarita Co. is siphoning away their business.
The Irvine Co., developer of the Spectrum industrial complex in East Irvine, doesn’t consider itself a competitor, however, and is charging about $12 a square foot for land these days. The cachet of an Irvine address so far is able to justify those prices, brokers say.
