Leading real estate investment manager The Resmark Cos. announced the formation of a programmatic joint venture between Resmark and DeNova Homes, a major home builder in Northern California. The venture has acquired substantially all of DeNova’s home building and land projects in the greater Bay Area whose value at sale will total approximately $700 million. DeNova is also under contract with Resmark on an exclusive basis for five years to acquire, develop, and sell future residential projects.
Ten existing DeNova residential communities with approximately 1,100 single-family homes and lots make up the new venture, and seven of the 10 are actively selling homes in their respective markets. They are located primarily within the four major statistical areas (MSAs) of East Bay, San Jose, Stockton, and Santa Rosa-Petaluma.
“This investment is unique in that it provides a compelling opportunity to invest in single-family residential projects that are significantly developed, with many currently producing cash flow. In addition, it offers a longer-term strategic opportunity to control a future single-family housing development pipeline on an exclusive basis with DeNova,” said Ziv Cohen, Resmark chief investment officer. “DeNova has spent years entitling these 10 communities, allowing us to immediately gain access to some of the best housing markets in the Bay Area where demand for homes continues at a strong pace.”
Cohen further noted that the average home price in the acquired portfolio is approximately $650,000, attainable pricing for housing in the greater Bay Area and a good value proposition for prospective home buyers.
DeNova is a well-established, experienced private California home builder owned by Dave and Lori Sanson since 1989. Resmark and DeNova have had a successful ten-year relationship through investments in five communities totaling 844 single family homes whose cumulative sales to date total approximately $500 million.
“We are pleased to form this joint venture relationship with Resmark, with whom we have had a decade-long partnership,” said Dave Sanson, CEO, DeNova. “We have great confidence in our future together, since we share common values and commitments to home buyers and the communities where they live.”
“DeNova is one of Resmark’s strongest operating partners and has a long-term presence in the residential market in Northern California,” stated Connie Emmitt-Stern, executive vice president of investments for Resmark. “This investment in markets with constrained housing supply and strong demand, coupled with DeNova’s reputation among home buyers for high-quality homes and customer service, supports the needs of Northern Californians who are often priced out of home purchases in the region’s cities.” She pointed out that DeNova has continued to sell and deliver homes at a normal pace during the COVID-19 market disruption.
The communities in both the initial program and future pipeline will fulfill Resmark’s and DeNova’s shared criteria for developing homes in locations with access to major employment centers, mass transit and major freeways, and within a short distance of schools, retail, amenities, and recreational options.
During the past 25 years through 250 investments, Resmark has financed the development of over 85,000 single-family homes and multifamily units in California, Washington, Oregon, Colorado, Utah, Nevada, Texas, Maryland, Virginia, and Washington, D.C.
