Sun Terra Communities, a division of JEN Partners private equity firm, has bought a 462-acre parcel at Walt Disney World's back door and plans to sell lots in the development to builders by the first quarter of 2011.
Sun Terra bought the debt on the property from Fifth Third Bank and then bid on the land at a foreclosure auction, said Richard A. Jerman, of Sun Terra. Jerman would not release the total cost of the property yet. Because of the way it was purchased, through buying bank debt, it's also not available through public records.
Jerman said the land was originally owned by a local Orlando-area developer who bought it in 2005 and had optioned lots on the land to KB Home. After KB abandoned the options, the land went into foreclosure. The largely undeveloped parcel near the intersection of County Road 535 and Reams Road in Orange County is entitled for 1,098 homes and 20,000 square feet of commercial space.
Sun Terra plans to have Phase 1 with 268 lots released by early 2011. Already builders are lining up for the lots, and Sun Terra will be choosing builders for the project soon, Jerman said.
Other private equity buyers also had been in line to buy the land from Fifth Third, including Kolter Land and Starwood Land, added Jerman.
"The property was one of the most sought after residential sites in the Orlando market," he said. "We have worked on this deal for probably 15 months. We were round and round with the bank. The bank wouldn't make a move for many, many months."
Sun Terra also has two other Orlando-area projects under development that it bought from GMAC last year, Live Oak Reserve and Cypress Lakes. Both parcels were repossessed from TOUSA's Engle division. Meritage is buying lots in Live Oak Reserve from Sun Terra, and NVR's Ryan Homes is buying lots in Cypress Lakes.