Hilco Real Estate is running the sale of a luxury condominium project in its development stage in Desert Hot Springs, Calif. Spanning more than 25 acres, the site is being sold as part of its owner’s bankruptcy proceedings.
The property is accompanied by a city-approved development agreement running through 2042. The planned gated community would have a total of 402 residential units upon completion.
“Hilco is the preeminent bankruptcy firm in the country,” Stephen A. Madura, senior vice president at Hilco Real Estate, told Multi-Housing News. “We’re often tasked by the U.S. Bankruptcy Court to handle bankruptcy cases that include… one-off single-asset bankruptcies like this one. The owner previous to this one had the parcel for six years, and eight years in total were involved in getting all approvals in place. The bank called the developer’s note, and they filed for bankruptcy to avoid foreclosure.”
“There is obviously other land available, but none with the density approved for development of this one,” added Jamie Coté, vice president at Hilco. “So, it’s a good opportunity to build inventory at a price point of upscale affordable condos.”
Booming market
The purchaser of the parcel will benefit from Desert Hot Springs’ rapid growth. The city’s population has expanded by 25.3 percent in the last decade, according to U.S. Census data. Desert Hot Springs is a tourist destination with a significant retiree population. Located 10 miles from Palm Springs International Airport and eight miles from Joshua Tree National Park, the area is a draw for outdoor enthusiasts.
“This is a fantastic alternative to the areas nearby where people have been priced out,” Madura said. “That goes for developers as well as owners. The next developer can stand on the shoulders of those who have gone before.”
There is a qualified bid deadline of July 13th, said Coté. “Once we get multiple offers, which we assume we will because of the desirability of the area, we will invite those bidders making compelling offers to take part in the second phase.” Once a buyer emerges in the second round, the deal will be subject to approval by the bankruptcy court.
Several months ago, Mogharebi Group arranged the $11 million sale of a Palm Springs, Calif. affordable property.
