Land Marketed for a Use the Code Did Not Allow

A representation can outlive the facts for a long time when no one tests it against the controlling record. One example, anonymized.

A small multi-parcel assembly was being marketed for commercial development. The premise had stood for decades, carried by people with deep local tenure: the land was commercially developable, and that was the basis on which it was listed, marketed, and brought to escrow.

I went past the listing and the surface zoning to the instrument that governs the use, the city's specific plan and its amendments, read against the parcel data for the assembly.

Commercial use carried a condition. The plan permitted commercial development only where a minimum contiguous development area was met. The assembly fell below that threshold, and below it, by-right use reverted to single-family residential. The use the land was being marketed for was not permitted at the assembly's size, and had not been for as long as it had been promoted that way. I documented the finding and sourced it to the planning authority, in writing.

The finding was dismissed. On the day the buyer was to remove contingencies, he repriced the deal, then walked. Escrow collapsed. A later buyer met the same dismissal of the same documented restriction. Years on, the land is still marketed for the same use it cannot support. It remains vacant.

A representation repeated with conviction is not the same as a permitted use. Read the controlling record before you rely on the story. The detail others skip is usually the one that decides whether the deal is real.

That kind of read is the judgment I put my own capital behind now. I do not chase deals. When one finds me, this is how I read the ground under it.

Benoit Lapointe invests in healthcare and real estate. He is the principal of Meridian in Newport Beach. benoitlapointe.com