Sekisui House Boosts Its Investment in U.S. Development

Newland Communities’ land development partnership with a subsidiary of Japanese home builder Sekisui House more than tripled late last year with Sekisui buying out the interests of the California Public Employees’ Retirement System (CalPERS) in 28 Newland master-planned communities in 15 markets in 11 states. Newland announced today the transaction with North America Sekisui House (NASH), which includes 16,300 housing units and 5,778 acres planned for commercial/retail use or currently being entitled for future development. “This is a good thing for a whole bunch of reasons on a whole bunch of fronts,” said Newland CEO Robert B. McLeod. After taking heavy losses on its residential land investments during the real estate recession, CalPERS is moving some of its investments out of residential real estate, said McLeod. At the same time, Sekisui House has a desire to up its investment in the U.S. housing industry. The sale price of CalPERS’ interest was not released because of confidentiality agreements. McLeod said CalPERS’ managers took him up on his offer to buy out its interests in the Newland communities, interests that Sekisui quickly agreed to assume. “All we have done is replace a capital partner for all these projects,” he said. “I think all three parties are happy.” “The cool thing about it is Sekisui wants to invest in U.S. real estate. They have a lot of faith in the U.S. economy and U.S. business,” McLeod said. “They are one of the few investors putting money in land now. Nobody is investing in brand new deals now except Sekisui.”

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