EL SEGUNDO, CALIF. / RENO, NEVADA (November 20, 2009) -- PCCP LLC, a full-service real estate investment firm and lender, and Lewis Operating Corp., one of the nation’s largest privately held real estate development companies, today announced the $6.6 million acquisition of 798 finished and unfinished residential lots located in southeast Reno, Nevada. Approximately 600 of the lots are located in Damonte Ranch, a highly-desirable 2,000-acre master planned community. The 5,000-home community is located at the base of the Sierra Nevada Mountains, just 30 minutes from Lake Tahoe and 5 miles south of downtown Reno.
The lots were sold at a bankruptcy auction by LandSource, a joint venture between home builder Lennar Corp (LEN.N), LNR Property Corp, and MW Housing (principal member is the California Public Employee Retirement System, or “CalPERS”).
There was significant interest in the lots due to their location in supply-constrained Damonte Ranch. While the competition included local investors, investment funds and homebuilders, the PCCP LLC and Lewis Operating Company partnership was strategically positioned to prevail in acquiring the property. PCCP brought extensive experience in distressed asset and bankruptcy proceedings and Lewis Operating Corp. has 40 years of homebuilding and land development experience in the Reno market.
“Damonte Ranch is the most desired new home community in Reno with a limited number of improved lots. Even in this down market there is still strong demand for new homes that are priced correctly, specifically in this region of Nevada,” noted Jim Galovan, Vice President, PCCP, LLC. “Going forward, we intend to add value to the lots in various ways including the possible re-entitlement of a portion of them to a product
type that will gain more market acceptance in the near term. The business plan is to then bring the lots to market for sale to homebuilders beginning in 2011, market permitting.”
Galovan added that residential real estate seems to be closer to the bottom than other real estate property types. Reno is now in its fourth year of downturn, and housing prices have backed up to approximately 2001-2002 affordability levels.
This transaction marks the first combined purchase by PCCP, LLC and Lewis Operating Company. The firms plan to actively seek additional opportunities. Galovan added that the two firms have complimentary skill sets which will aid them in acquiring distressed assets in need of recapitalization and restructuring. PCCP, LLC made the acquisition as part of its California Smart Growth Fund, IV, LLP.
About PCCP, LLC
PCCP, LLC, formerly known as Pacific Coast Capital Partners, is one of the premier providers of opportunistic debt and equity capital for real estate in the United States. With offices in Los Angeles, San Francisco and Sacramento, California, PCCP is known for its ability to underwrite complex situations and craft effective solutions. PCCP provides capital to the entire spectrum of real estate projects and capital structures and is actively seeking to buy whole loans and to recapitalize quality projects. Visit PCCP online at www.pccpllc.com.
