A Los Angeles-area finance firm has paid $95 million for a pair of properties in Sunnyvale so Toll Brothers can build 329 homes.
Hearthstone, based in Calabasas, bought an 8.6-acre parcel and a 3.2-acre site at 1175 Aster Avenue, the San Francisco Business Times reported. The seller was Peninsula Building Materials.
Under the terms of a related agreement, the Pennsylvania-based Toll Brothers has the option to buy the parcels or pick up pieces of them over time.
Toll plans to build 140 townhomes on the 8.6 acres on the west side of the property, and 189 condominiums in two buildings on the 3.2 acres on the east side.
A third, 5.1-acre parcel is now being developed by Olympic Residential Group, based in San Francisco, with 412 apartments.
Hearthstone and Toll secured a $117 million loan from Western Alliance Bank and a few unnamed lenders to buy and develop the Aster Avenue properties. They’re near Caltrain’s Lawrence Station in an area targeted by the city to be redeveloped into an urban neighborhood.
As part of an earlier agreement between Hearthstone and PBM, the seller of the land has a right to a slice of the profits of sales of finished homes on each parcel.
The triangular property was once occupied by PBM, which used it as a materials yard, and Calstone, which made pavers. PBM moved its operations in 2016 to Santa Clara, while Calstone shut down operations three years later.
Earlier this month, Robert Toll, who co-founded Toll Brothers and helped transform the regional housing builder into a national development firm, died at his home in New York. He was 81.
In August last year, Toll Brothers teamed up with Sam Zell’s Equity Residential to develop at least $1.9 billion in rental apartments across the U.S.
— Dana Bartholomew
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