News Article | 10/4/2007

7,000 homes planned near Fort Bend’s Sienna Plantation

Dallas-based Hillwood has purchased a large parcel of land next to Sienna Plantation in Fort Bend County for its first master-planned community in the Houston area.

The company, owned by Ross Perot Jr., plans to develop lots for 7,000 single-family homes on the 3,827-acre Sienna Plantation South property.

“We are big master-planned community developers, so it really takes the right piece of property to make the jump into a new market,” said Brian Carlock, vice president of Hillwood Residential. “We couldn’t have picked a better springboard into a new market.”

Undisclosed price

The land, which had already been slated for residential development, is south of the Sienna Plantation Country Club between the Brazos River and FM 521. The property was purchased from the Godi Group of Arizona for an undisclosed price.

The deal comes amid a U.S. slowdown in home construction, stemming from fallout in the subprime lending industry. Builders in some regions have experienced a glut of homes that have been built but not sold, but the problem has not been as pronounced in Houston.

Builders here have slowed the pace, starting 11,271 homes in the second quarter, an 18 percent drop over the same period in 2006, according to Metrostudy.

Betting on market

Hillwood is betting the market will be strong when the first homes go up in 2010. The company will begin preparing the land next year, with the first lots set to be available in late 2009.

The project name, Sienna Plantation South, could change.

“We’re optimistic that this housing cycle will work itself out,” Carlock said.

Factoring into the decision were the natural setting with old oak trees, the recent opening of the Fort Bend Parkway Toll Road and strong job growth. Houston has added 82,000 jobs in the last 12 months ending in July.

“We’re very impressed with the Houston economy and housing market,” Carlock said. “It is recognized as being one of the strongest in the country.”

The land is part of the 10,500-acre Sienna Plantation in the Missouri City area. So far, about 4,500 homes have been built there.

The community was the fourth-fastest-growing community in the Houston area in 2006 with 709 homes started, according to Metrostudy.

$300,000 average

Homes will be priced from $160,000 to $1 million and will average in the $300,000s. Price points will be similar to those in Johnson Development’s Sienna Plantation, which opened 10 years ago.

The development will include 1,000 acres for parks and open spaces, 300 acres for commercial use and 100 acres for schools and churches.

Hillwood has about a dozen master-planned communities in the Dallas area. It also handles office, industrial, golf course, high-rise condominiums, rail yards and corporate campus projects. It’s known for its 17,000-acre AllianceTexas business park near Dallas-Fort Worth International Airport.

The Sienna Plantation South purchase represents Hillwood’s largest residential property purchase. The company will look for other development opportunities in Houston and could add three to five projects in the next five years, Carlock said.