THE DEAL: Mattamy Homes buys 235 acres in Lakewood Ranch from developer Schroeder-Manatee Ranch Inc.
BUYER: Mattamy Sarasota LLC (Calben US Corp.), Winter Park
SELLER: SMR North 70 LLC
PROPERTY: a portion of Malachite Drive just east of Lakewood Ranch Boulevard, Lakewood Ranch
PRICE: $17.15 million
LAW FIRM ON DEED: University Title Services, Lakewood Ranch
WHAT: Canadian homebuilder Mattamy Homes purchased a large parcel of Lakewood Ranch for $17.15 million to develop 675 townhomes and detached single-family homes.
CONDITIONS: A recovering home market created a need for additional residential diversity in the largely single-family Lakewood Ranch market.
The master-planned Lakewood Ranch, located east of I-75 in Manatee County, is currently home to 8,000 households and 18,000 residents.
Mattamy Homes is Canada's largest homebuilder, with operations across Canada and the United States. It has built more than 60,000 homes in North America.
THE FIND: Steve Parker, president of U.S. Group of Mattamy Homes, became familiar with the master-planned community of Lakewood Ranch seven years ago. Parker was working for Morrison homes, of which he later became president and CEO, while the company was building homes there. Talks continued between Parker and Rex Jensen, president and CEO of Schroeder-Manatee Ranch, and their staffs, when Parker transitioned to head the U.S. arm of Canadian builder Mattamy Homes. However, by then (2009) the residential real estate market had soured in Florida. But both companies kept in touch.
VISITS: Since then both companies have exchanged several visits. A group of SMR management, including Jensen and Todd Pokrywa, vice president of planning for SMR, visited a number of Mattamy communities in southeastern Ontario, Canada, following those initial discussions in 2009. Talks picked up again in March 2013, when Pokrywa traveled to Toronto with the Tampa Bay Lightning because of SMR's partnership with the NHL club, and met with Mattamy Homes executives.
CHANGING PARCELS: Besides the dour market, Mattamy Homes had resisted building in Lakewood Ranch because it considered most of the proposed sites too small.
“Initially they talked about just having us come in as a [home] builder,” Parker says. “Those parcels weren't big enough for us to do what we like to do: create a community within a community.”
That changed with Pokrywa's most recent visit in March. SMR offered to sell 235 acres south of Malachite Drive between Lakewood Ranch Boulevard and White Eagle Boulevard also known as Pope Road in Lakewood Centre. Parker says he knew when the agreement reached that size that it was going to happen.
“With a community of 700 homes we can offer multiple product types,” Parker says.
NEEDED DIVERSITY: SMR was attracted to the deal, Pokrywa says, by the added diversity of new residential product it would create north of State Road 70. Mattamy Homes will build some 675 townhomes and single-family residential units with prices starting in the mid-$100,000s. That development and others in Central Park, Esplanade, and Bridgewater as well as the multifamily rental communities of Lost Creek and Creekside would create the critical mass SMR wanted for commercial and office development in Lakewood Centre.
FINANCING: Due to the size of the land transaction, the two companies worked out an agreement for SMR to offer Mattamy Homes an $11.43 million loan for the purchase. The loan lets Mattamy Homes take sole ownership of the property from the beginning, while paying it off in phases over time.
TIME LINE: Mattamy Homes plans to start building roads and other infrastructure in the community late in the second quarter. It hopes to have home models open for sale in late 2014 or early 2015.
FUTURE: In an email to the Business Observer, Parker says the company will continue to seek out more land in the area.“We plan on becoming very aggressive in growing our Sarasota/Bradenton operation in the coming years,” he said in the email.
Mattamy Homes has also announced plans for Tampa communities in the near future, but Parker declined to disclose specifics until the deal is finalized.
SMR expects the Canadian builder's activity in Manatee County to attract additional Canadian residents and businesses to the ranch. According to Jimmy Stewart, vice president of sales for LWR Communities, a subsidiary of SMR, Canadians currently account for only 2% of homebuyers in Lakewood Ranch.