FivePoint Says Plan Will Push Forward $12.7 Billion Development

(Bloomberg) -- FivePoint, a real estate developer whose largest shareholder is Lennar Corp., said it's come up with an environmental proposal that should allow it to move forward with a $12.7 billion master-planned community in northern Los Angeles County.

The California Supreme Court a year ago blocked the project, known as Newhall Ranch, over greenhouse-gas emissions and the protection of an endangered species of fish. FivePoint said it expects the court's concerns to be satisfied by a new plan, announced Thursday, that calls for zero-net-energy construction standards, electric-vehicle charging stations at each of 21,500 planned homes, electric school buses and funding for emission reductions in California and around the world.

“This was theoretically the last hurdle,” Emile Haddad, FivePoint's chairman and chief executive officer, said in a phone interview. “Obviously this takes away the argument that we have any impact on the environment.”

The project, which has been tied up in court since its initial approval in 2003, still must be re-certified by the Los Angeles County Board of Supervisors and approved by the California Department of Fish and Wildlife. The state's supreme court in 2015 ruled that Newhall's environmental impact report didn't meet state requirements for greenhouse-gas emissions and avoiding the endangered unarmored threespine stickleback fish when building bridges.

‘Net Additional'

California's Air Resources Board today released an analysis of the Newhall Ranch environmental plan saying that it “would not result in any net additional” greenhouse-gas emissions “after the mitigation measures are fully implemented.”

Haddad said he hopes to start construction by mid-2018. In addition to homes, including rental and affordable housing, Newhall Ranch is slated to have 11.5 million square feet (1.07 million square meters) of commercial and industrial space, seven new public schools, four fire stations, 11 parks and a public library.

John Buse, an attorney with the Center for Biological Diversity, which has fought the project in court, said that “caution is still the word” with FivePoint's new plan.

“This all happened very quickly,” Buse said. “This was going on for months and months behind the scenes, then this approach pops up. We're properly skeptical until convinced otherwise.”

To contact the reporter on this story: Prashant Gopal in Boston at pgopal2@bloomberg.net.

To contact the editors responsible for this story: Daniel Taub at dtaub@bloomberg.net, Christine Maurus