KB Home Opens Two New Communities in Lancaster

When the real estate crash hit the high desert, burgeoning communities dried up. Developers stopped their projects mid-stream to await better times or simply handed their land back to lenders. Now two stalled Lancaster communities are moving forward, the result of Los Angeles-based KB Home swooping in and the city of Lancaster pushing incentives to help sell vacant unfinished housing projects. The homebuilder recently opened two communities — Dorado Vista and Middleton — for sale. KB said it plans to build 83 new homes at Dorado Vista. The community already has about 60 houses built by two previous developers. Plans for Middleton call for 18 homes. When the crash came “a lot of people left but we stayed,” said Tom DiPrima, KB’s executive vice president for Southern California. The communities will be built as homes are sold, and homes will come equipped with a solar power system as a standard feature on each home. The communities, which KB picked up last December from a homebuilder and a bank, are part of a larger strategy to target distressed, already entitled parcels for purchase and development. In the case of Dorado Vista and Middleton, the infrastructure was already largely there — most of the streets have been completed and light posts erected. “In every city in the Antelope Valley, these communities were left abandoned and it puts pressure on the city” because of vandalism, DiPrima said. “The cities recognize the value of having someone come in and finish these communities,” he said. Indeed, Lancaster has been luring developers to do just that. Two years ago, the city passed a building incentive program that decreased development fees, hoping to spur jobs, revenue and community revitalization. Last year, the city council narrowed the program to apply to only existing tracts, because developers had only used the program for those projects, said Robert Neal, Lancaster’s public works director. Since the program launched in 2010, 460 new single-family homes have been permitted and $5.2 million in fees have been collected — much more than if the city hadn’t decreased its fees, Neal said. “It’s cleaned up a lot of neighborhoods — at least seven tracts that I know of,” he said. Besides KB, homebuilders Richmond American Homes, Beazer Homes and Pacific Communities have taken advantage, Neal said. Dorado Vista — located at 44209 Rucker Street — will have one- and two-story homes with up to six bedrooms, three bathrooms and two-car garages. Prices start in the high $100,000s, KB said. At Middleton in West Lancaster, the two-story homes will have three to six bedrooms and will be priced starting in the mid-$200,000s. KB is also underway on construction of its Arroyo community on East Kaylyn Street in Lancaster. DiPrima said KB would not have purchased the Dorado Vista and Middleton properties, which combined total about 20 acres, if not for the fee reductions from the city of Lancaster. The numbers simply wouldn’t have worked, he said. In the first quarter of this year, KB Home saw revenues rise 29 percent to $254.6 million. The company also narrowed its losses to $45.8 million, compared with $114.5 million from the same period a year earlier and delivered 309 homes on the West Coast compared to 224 during the first quarter last year. Since Lancaster launched its fee reduction program, KB said it has purchased eight new communities, which includes Dorado Vista, Middleton and one currently in escrow.There is still a long way to go, though. In Lancaster, there are about “30 existing, partially built-out tracts with approximately 1400 lots remaining,” Neal said in an e-mail.