O.C. Builder, Rockefeller Realty Joining in Project : Housing: Akins will help develop 116 homes in San Gabriel Valley in the San Francisco company’s first such venture in California.
A partnership led by former Chase Manhattan Bank chairman David Rockefeller has joined with an Orange County home builder to develop its first single-family housing project in California.
After two years of negotiations, Rockefeller & Associates Realty of San Francisco has signed a deal with Akins, consisting of three Irvine home building companies, to construct at least 116 homes as part of a 277-acre residential project called Ridgemoor in Rowland Heights in the east San Gabriel Valley.
Known for major commercial projects such as the Embarcadero in San Francisco, the Rockefeller group has recently diversified into residential building with single-family homes in Arizona and Florida.
“We believe the Southern California economy will be showing a little life in the next three years and housing will be a good place to be if you’re in the real estate business,” said John Taylor, vice president of finance for Rockefeller. “California is a laggard in the recovery and I think when home prices come back they are going to come back with a vengeance.”
The Rockefeller group is the latest in a string of developers, such as Centex Corp. of Dallas, the nation’s largest home builder, and Del Webb Corp. of Phoenix, that have announced major moves into the Southern California housing market in the last two weeks. Some say the fact that these deep-pocket investors are choosing to put their capital here, often in joint ventures with cash-starved local builders, is a sign that the Southern California real estate industry is starting to recover.
“These developers believe that local real estate values have bottomed and this is the time to position themselves for the turnaround,” said John Shumway, president of Market Profiles, a real estate consulting firm in Costa Mesa. “This is a real positive sign. But are we still fragile? Yes.”
Bruce Akins, president of Akins, said the joint venture is part of his company’s strategy to provide expertise and local know-how to investment groups, often from other states, that have bought residential property in Southern California and need help to develop the projects. He said the recent moves by Rockefeller and Centex are a healthy sign for the local real estate market.
“These are smart investors, not vulture investors. They are people who made money in Dallas, Denver and Boston,” Akins said. “People are tired of sitting on the sidelines and are deciding now is the time to get into the game.”
Besides building the homes, Akins will be responsible for planning, developing and marketing other lots at Ridgemoor, a 508-lot development. The homes the Akins-Rockefeller team is planning will be priced from $232,000 to $285,000 and would begin selling in September. If the Ridgemoor deal is successful, Rockefeller and Akins plan future residential development projects together, possibly in Orange County.
Akins was started by brothers Bruce and Carl Akins and is considered to be a continuation of a family business started in 1948 by their father, Ed Akins. The senior Akins later headed Irvine Pacific, the home-building arm of the Irvine Co.
His sons run three companies: Akins Homes, which plans and builds homes; Akins Construction, a builder of expensive custom homes such as the personal residence of Orange County developer William Lyon in Coto de Caza, and Akins Communities, which builds, manages and markets homes for landowners for a fee.
“We had discussions with other builders, but Akins does it all quite well,” Taylor said. “Also, they are a small, family-owned business and basically, we’re a family-owned business. There’s an affinity there.”
Akins has managed to survive the recession with flexible tactics such as finding joint-venture partners to acquire the land on which Akins homes are built. As a result, the company does not have expensive loan payments and other debt during the life of the projects.
The company also hires itself out for a flat fee to build housing tracts for other developers, such as in the University Hills community at UC Irvine and the conversion of 1,500 apartments to condominiums for the Irvine Co. Akins has built homes in Tustin Ranch, Rancho Santa Margarita, Mission Viejo and Dove Canyon.
In 1993, Akins built 158 single-family homes and 498 attached units. Akins, a private company that doesn’t release profit statements, reported sales of $132 million last year.
While Rockefeller & Associates Realty was attracted by Akins’ knowledge of the Southern California market, the company isn’t a stranger to Orange County. It made local headlines in early 1990 when it announced plans to build a 13-story office building called Central Park Towers in Anaheim. The project was later shelved.
“We still own the land, but that project was a casualty of the times,” Taylor said. “We hope one day to build that building.”
