A group of more than 30 homeowners in a small residential subdivision near Fair Oaks Mall in Fairfax County signed a contract last week to sell their land as a single unit to a commercial developer for approximately $7.5 million, a deal that will reap all of them higher profits than if they had sold their lots separately.
Realtors in the Northern Virginia area say they believe this is the first time a group of homeowners of this size has taken the initiative to negotiate such a deal.
Thomas Burke, one of the four residents of the Random Hills subdivision who worked on negotiations with developers, said that his house probably would sell for about $115,000 as a residential unit but that he will get more than three times that much by selling to a commercial developer as part of a single large parcel.
"We consider it quite a success," said Random Hills resident Richard Redfearn. "To do it in a neighborhood with as much variety as this one was really something."
The deal, which is contingent on the county agreeing to rezone the land for commercial development, includes 19 properties on 16.5 acres. The developer, Property Co. of America, has agreed not to go to settlement on the land for three years.
Burke said that when he bought his home in Random Hills 10 years ago, the place was quiet and protected. The development was tiny by Fairfax standards even then -- only 18 houses -- and tucked in between Route 50 and a long swath of forested land to the south.
Then came I-66, which passes a stone's throw away from Burke's house, and, several years later, a Fairfax County land-use plan that designated the intersection of Route 50 and I-66 as the future commercial and political center of the county. And then came the bulldozers and the traffic.
"When we started seeing what was going on around us, we started thinking maybe if we all band together, we might do better," said Burke. "It was almost surprising how smoothly it went, getting the 34 homeowners to agree." Burke said that many of the homes had at least two owners, usually spouses.
The Random Hills subdivision sits at what county planners expect will be the very heart of the Route 50 and I-66 area, the site of a future high-density "urban village" of high-rise residential and commercial development. Although the land-use plan included keeping Random Hills intact, most of the land surrounding the area already has been rezoned commercial.
"We went and looked at some of the residential communities back behind Tysons Corner, and we said, 'We don't want that to happen to us,' " said Burke. "This way, we can avoid a lot of problems."
The homeowners said they got the idea of selling their land as a single parcel after hearing about a group of Atlanta homeowners who made a lucrative sale when their neighborhood was threatened by commercial encroachment.
Burke said that members of Random Hills were included in the resident-developer task force that put together the Route 50 and I-66 land-use plan and that originally they had pushed to keep Random Hills from being rezoned to commercial. But once Random Hills residents began to see the effects of the plan, they changed their minds.
"We didn't think we would be affected, but we were just wrong," said Burke. "There is too much going on around us. We are losing the trees, traffic is already intolerable, and we have felt that, as a residential community, the area is dropping in value."
Although parcels around Random Hills already rezoned commercial have risen quickly in value since the adoption of the Route 50 and I-66 plan, the value of the Random Hills parcels has increased only with inflation. Burke said that, as the area began to lose its protected status, residents became concerned that residential values might begin to drop.
As commercial land, however, the area has proved to be a gold mine. No one involved in the deal would release the total price, but one source said that the land sold for $10.50 a square foot. With 16.5 acres in the parcel, the total would be $7.55 million
Redfearn said that the homeowners approached Property Co. of America because they knew that developer already was working in the area. The company obtained rezoning to permit it to erect an office building just up Random Hills Road from the subdivision this year and had expressed interest in other properties in the area.
Representatives of Property Co. of America could not be reached for comment, but the Random Hills residents said they understood that the Texas-based development company was putting together a mixed-use development plan for the area.