Target Markets and Methodology
As a general theme SBD focuses on areas undergoing gentrification that present land values with a much lower percentage of total project costs than more established luxury markets.
We then overlay LA building codes favorable to much higher deliverable square footage, translating to higher gross price and scaling of the spread between building costs and sales per foot.
• Example: MB tree section lot purchased for 1.3MM, built 3200 square feet and sold for $2.9MM,
• Example: Venice lot purchased for $1.3MM in 600 block of Brooks, built 6,000 square feet duplex, gross sales price $3.5MM.
SBD continues to focus on markets with a critical mass of underserved high-end buyers,
• Household incomes are much higher, and rising faster, than the rest of LA and the US: enabling a higher percentage of all cash and high down payment buyers,
• Credit scores are better than in other markets: risk is lower, lenders are more willing to qualify,
• Education levels are significantly higher than surrounding markets; offering a more stable buyer pool,
• Gentrification tends to continue once a critical mass of new buyers, services, and amenities has been established.
• The entire Silicon Beach submarket, in just the past seven years, has gone from a bohemian enclave with pockets of affluence to a complete, rapidly developing tech-central ecosystem.
Target Market – North Bay
• North Bay markets are characterized by mid-50s vintage housing with favorable underlying zoning
• Rapid, block-by-block gentrification centered around tech wealthy and local elite.
Target Market – South Bay
• South Bay target markets are characterized by an established base of very high-end homes expanding into sections farther and farther from the beach.
• International buyers and local elite, with a very high percentage of cash purchasing power, dominate these markets