Toll Buys Land Near Denver to Build for Older Homebuyers
Toll Brothers Inc. (TOL), the largest U.S. luxury-home builder, is opening its first community for older buyers that’s west of the Mississippi, on Colorado land that competitor PulteGroup Inc. (PHM) sold in December 2011.
Toll Brothers purchased 387 lots at Anthem Ranch, about 20 miles (32 kilometers) north of Denver, to develop homes for buyers age 55 and older, said Kira Sterling, a spokeswoman for the Horsham, Pennsylvania-based builder. Terms of the deal weren’t disclosed.
Sales of new homes jumped 15.6 percent from a year earlier in January to their fastest pace since July 2008 as buyers take advantage of low interest rates and the supply of existing houses on the market shrinks. Toll, which has developed “active adult” communities since 1999 in eastern U.S. states, is betting that demand will grow faster from couples who want smaller luxury residences after their children have moved away from home, Chief Executive Officer Douglas Yearley Jr. said.
“As waves of baby boomers continue to enter their 55-plus years, we are expanding our active-adult brand across the nation,” Yearley said today in a statement.
About 50 of Toll’s 225 selling communities were restricted to older residents as of the quarter ended Jan. 31, Sterling said. Last year, 11 percent of the company’s homes were sold in age-restricted developments.
The first lots at Anthem Ranch will go up for sale in May. Finished homes, which will be ready for occupancy next year, will sell for $300,000 to $400,000.
The original developer of Anthem -- Del Webb, a unit of PulteGroup -- sold the 1,700-acre (690-hectare), master-planned community of Anthem in December 2011 for about $28 million to Wheelock Street Capital LLC and Oread Capital & Development, said Jeff Handlin, president of Oread, a Broomfield, Colorado- based investor in Colorado and Florida real estate.
The announcement was made after the close of regular U.S. trading. Toll fell 1 percent to $35.26 in New York today. Its shares are up 55 percent in the past year, compared with a 77 percent gain for the 11-member Standard & Poor’s Supercomposite Homebuilding Index. (S15HOME) Bloomfield Hills, Michigan-based PulteGroup, the largest U.S. builder by market value, has risen 138 percent, making it the index’s biggest gainer.
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