HOUSTON – Toll Brothers, Inc., a leading builder of upscale homes, in a joint venture with GTIS Partners, have acquired the 3,700-acre Sienna South, the last major undeveloped parcel of Sienna Plantation master planned community in Fort Bend County.
The purchase price was not disclosed but the Wall Street Journal pegged the value of the deal at $78 million. The land was purchased from Hillwood Development, a Texas-based firm led by Ross Perot Jr.
The Toll-GTIS joint venture expects to develop 6,500 single-family home lots on the property, which will be sold to local, regional and national home builders over time. Toll Brothers may acquire up to 1,750 of those lots for its own home building operations.
When fully built out, it is anticipated that Sienna South will have generated gross home sales of over $2.6 billion. The Toll-GTIS joint venture has entered into an agreement with The Johnson Development Corp., developer of Sienna Plantation and other major Houston communities, to act as master developer of Sienna South.
The property is located west of FM 521 and south of Highway 6. The county-financed financed Fort Bend County Parkway, scheduled to be completed by early 2014, will connect Sienna Plantation to Houston’s Loop 610.
Houston home building market is the strongest in the nation, due to strong job growth, with over 86,000 new jobs created last year.
“That job growth has made Houston the hottest home-building market in the country,” wrote Wall Street Journal reporter Kris Hudson. “The metro area generated 46,462 residential building permits in the first 11 months of last year, more than any other U.S. metro area, according to the U.S. Census Bureau.”
A severe shortage of lots in the Houston area has been holding back home builder sales. Smaller development companies have been having difficulty getting loans to create new subdivisions because bankers have been overly conservative, despite the evidence that the consumer demand is overwhelming, Harry Masterson, 2013 president of the Greater Houston Builders Association, said in an interview late last year.
The supply of unsold completed home sitting vacant has dwindled to its lowest point in many years, according to Metrostudy.
“With Houston’s well-publicized shortage of available home sites in premier master planned communities, we believe the project’s timing, Sienna Plantation’s stellar reputation, our experienced management team, excellent location, amenities and highly rated schools will attract home builders and home buyers across the price point spectrum,” said Karl Mistry, Toll Brothers Houston Division President. “Fort Bend County has the third-highest median household income of all counties in Texas and is among the top 30 nationwide.”
Based in Horsham, Pa., Toll Brothers entered Texas in 1994 and is five-time winner of the Texas Builder of the Year Award from the Texas Association of Builders. The firm is selling in 28 communities in Dallas, Houston and San Antonio and it will open two communities in Austin this year.