Toll Brothers buys big residential site from Warmington
Toll Brothers has acquired a fully entitled, 200-unit-plus residential development site in the red-hot housing market of Milpitas from Warmington Residential.
The deal, which closed last month, was called a rare sale by Warmington, which usually builds the land it entitles, according to a news release. The transaction was arranged by The Hoffman Company, an Irvine-based land brokerage that has offices in San Ramon.
The price was not disclosed. But county records show that Toll acquired a development site from Warmington last month for just under $46 million.
The transaction is the latest example of strong homebuilder demand in Milpitas, where a building boom is taking place around the planned Milpitas BART station near the Great Mall.
The project Toll Brothers bought is called Traverse, and it will consist of 98 townhomes and 108 condos, on what is currently an auto wrecking yard (read more here). In a news release, The Hoffman Company said the project was valued at more than $100 million.
Toll has seen success in Silicon Valley: In earnings calls, CEO Douglas C. Yearley has said repeatedly how successful a development in Sunnyvale turned out, with homes commanding ever higher prices.
“Well, I’d love to have Sunnyvale back,” he said in the company’s most recent earnings call, according to Seekingalpha. “It’s been unbelievable what happened there.”
In a news release, Cameron Fowler, a Hoffman Company broker who worked on the deal, said the transaction made sense for both parties.
“Due to the significant price lift in the land market and numerous projects they already have in the pipeline, it made sense for Warmington to sell and amortize the project sooner rather than later,” he said in a statement. “And for Toll Brothers, the deal allows them to take advantage of the upward trending housing market and a price point that fits well with their long-term growth strategy in the Bay Area.”
Toll Bros. currently has active projects in Sunnyvale (priced in the upper $1 millions), Pleasanton (priced from the mid-$1 millions, Dublin (priced from the upper $900,000s), San Ramon (priced from the mid-$1 millions) and Brisbane (priced from the low $1 millions).
Nathan Donato-Weinstein covers commercial real estate and transportation for the Silicon Valley Business Journal.