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  • Randall Benton / rbenton@sacbee.com

    Dead-end signs populate a neighborhood where home construction has stopped at Plumas Lake in Yuba County. A group of homeowners there is suing the developer over amenities that were never built.

  • Sacramento

Yuba County developers weigh value of orchards vs. houses

Published: Monday, Feb. 17, 2014 - 12:00 am
Last Modified: Monday, Feb. 17, 2014 - 8:57 am

Once there was a housing boom. Now there’s a nut boom.

In the sprawling Plumas Lake subdivision in rural Yuba County, farmers are planting walnut trees on land that was slated for thousands of homes in the last decade but is now worth more as nut orchards.

A short drive away, in the town of Wheatland, developers are moving ahead with plans to build thousands more homes where walnut trees now stand. But they’re not tearing out those trees just yet.

For now – and perhaps for years to come – nuts are a more valuable crop than houses in Yuba County, said Sarbdeep Atwal, a Yuba City lawyer and farmer. His family bought lots in Plumas Lake from developers at a fraction of their former worth and have been preparing the ground to plant walnut trees.

“Right now agriculture is at an all-time high as far as commodity prices go,” Atwal said. “Walnuts, almonds, pistachios, pecans and pretty much all the nut crops are being bought out by eastern markets such as China and India. So planting acreage is more attractive to farmers to expand operations.”

Prime walnut land in Yuba County is selling for $15,000 an acre, and existing orchards for $25,000 an acre, Atwal said. That’s more than twice the $10,000 an acre that he and others said housing lots in Plumas Lake would fetch from developers these days.

“When the housing boom declined, development stopped,” Atwal said. “A lot of the Plumas Lake subdivision is nested in top California agricultural soil. It’s premier farmland. In the meantime, it isn’t going to be further developed for quite some time. We purchased property from developers who essentially just walked away.”

Yuba County, home to Beale Air Force Base, with its unmanned drones and U-2 spy planes, was the site of some of the Sacramento region’s most far-flung exurban development in last decade’s housing boom.

Nearly 12,000 homes were planned for Plumas Lake, a flood-prone stretch of former farmland alongside the Feather River. But only 2,000 of these had materialized by the time the U.S. Census was taken in 2010, after construction had stalled in the housing crash. Shopping centers and other commercial development never materialized, leaving residents with just a drugstore and gas station and a long drive to other services. Those houses that do exist sit behind levees fortified with more than $400 million in state bond funds, county tax revenues and development fees.

Some residents have sued one of the nation’s biggest home builders, Lennar, claiming the company artificially inflated prices before walking out on them when the market tanked. The company abandoned its project at Plumas Lake, leaving large suburban homes bordered by weed-choked vacant lots, the lawsuit claims.

A federal judge in Sacramento allowed the civil action to move forward last month over the home builder’s objections.

“It’s been two years of a hard fight to get to a point where a judge says we have a case,” said plaintiffs’ lawyer Glen Van Dyke.

Today, home building has resumed in Plumas Lake at a modest pace compared with the hundreds of homes built from 2005 to 2007, during the last years of the housing boom. Two local builders are putting up about a dozen houses and others are in the planning stages, county officials said.

“It’s a big rush compared to years ago when not only were they not building homes, but all those homes were being foreclosed on,” said Yuba County Supervisor Roger Abe.

The situation in Plumas Lake hasn’t stopped landowners elsewhere in Yuba County from pushing forward with development plans. About 10 miles east of Plumas Lake in the small town of Wheatland, Angelo K. Tsakopoulos and other developers have proposed building more than 17,000 homes in areas that are mostly dry pastureland and walnut groves, according to a recent report by the Sacramento Area Council of Governments.

SACOG, which promotes measured growth through its regional planning “blueprint,” said there’s a certain logic to planning for growth in Wheatland.

By 2035, the Sacramento region will need 300,000 more homes, the group said. Some of those homes will be built in Yuba County, for people who prefer the exurban lifestyle or want affordable houses within commuting distance of jobs in Sacramento and Placer County.

“It’s definitely not all crazy in Yuba County,” said Mike McKeever, SACOG’s executive director. “It’s not a matter of should there be growth or no growth. It’s how much and when and where. It’s a nuanced question.”

A driving factor, housing experts said, is that Plumas Lake and Wheatland are served by different highways.

Plumas Lake is about 30 miles from Sacramento along highways 70 and 99. But home prices in Sacramento remain so low that there’s little incentive to travel so far. Industry experts say Plumas Lake makes sense only when housing prices in Sacramento become unaffordable for many would-be buyers.

“Plumas Lake is a bit further out and a bit further from major services,” said Greg Paquin, a Folsom-based consultant to the new home industry and president of the Gregory Group. “It was always more of an affordability play. Consumers who couldn’t buy elsewhere could buy out there.”

Wheatland, in contrast, sits on Highway 65, which provides a direct shot into the bustling Placer County communities of Roseville, Rocklin and Lincoln. The idea is that Wheatland, about 22 miles from Roseville and 12 miles from Lincoln, could offer a less costly alternative that would be worth the commute for some people in the coming years. The completion of the Lincoln bypass in 2012 shaved time off the trip from Wheatland to Roseville and the Interstate 80 corridor.

“The way it’s looked at is Wheatland isn’t that far from Lincoln and the rest of Placer County. It’s a natural progression,” Paquin said.

The first batch of new homes – in an already annexed and approved project of about 500 houses called Heritage Oaks East – could start rising in Wheatland later this year, developers said.

“We’re all teed up and ready to go,” said Phil Rodriguez, vice president for community development with Lewis Planned Communities, the firm that’s developing Heritage Oaks East.

But massive construction on Johnson Rancho, a project planned on pasture and orchards controlled by Tsakopoulos, is likely years or even decades away, planners said. The next step is for Yuba County’s Local Agency Formation Commission to approve the annexation of the land that sprawls to the east of Wheatland.

Depending on how the housing market heats up, Plumas Lake also may be completed in a time frame of years or decades, they said.

“Eventually most of Plumas Lake will get built,” said SACOG’s McKeever. “Whether it’s 10 years or 75 years is the question.”

For now, developers and farmers are planting and harvesting walnuts because that’s where the profit is.

“They’re looking at 25 to 30 years of growing walnuts,” Abe said. “But at the same time, if you have a really hot housing market, you can take out the walnuts (and build houses).”


Call The Bee’s Hudson Sangree, (916) 321-1191.

Read more articles by Hudson Sangree





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