[IMGCAP(2)]Land banking was a popular way for builders to takedown lots held by a third-party during the run-up of the lastcycle, Banks and Perrin point out, but the practice largelydisappeared in the wake of the worst real estate downturn since theGreat Depression. "Now is the ideal time for builders who want tobuy finished and partially finished lots to meet expected housingdemand, but don't want a large initial cash outlay," says Perrin.He explains that land-banking allows builders improve their balancesheets by keeping the land and other improvements off their booksuntil they need it with an option purchase agreement.

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Greencrossing is primarily targeting mid-sized to large privatebuilders and all public builders planning to construct homes indesirable California markets. Observes Banks, "Everyone is aware bynow that the land market in key areas of California has heated upover the past year. Prices are rising and competition isfierce."

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Typically, Greencrossing's program targets deals with 100single-family lots or less and the property that is in some sort ofa developed state. The projected peak capital including land plusimprovements, excluding impact fees, typically would be between $5million and $15 million per deal.

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Banks and Perrin, who left Lennar in 2006 to start their owncompany, formerly led teams that helped Lennar Corp. acquire primeland holdings, attract joint venture capital and ride the wave ofthe last residential real-estate boom in the Inland Empire. Theyhave more than 40 combined years of experience in real estate andtogether have acquired, entitled and developed more than 20,000lots.

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