With cracks starting to form in what had been the thick freeze of the land market, I've been thinking about all the assets that have been either tied up in the bankruptcy courts or parked in some vault in banks' basements. Between banks increasingly getting real on how much they'll take for some of the land that's gone back on their books and builders hungering for cheaper land to replenish their lot pipelines and guarantee future positive cash flow, we're on the brink of a major redistribution of assets. 

In an article from a couple months ago, I had written on this topic, in particular about how critical the workout scenarios for the LandSource and Lehman portfolios churning through the bankruptcy court were to this process. While those might be the big boy portfolios, a lot of eyes have also been on the Tousa and Kimball Hill portfolios, which arguably are much more palatable to prospective shoppers because the portfolios are chock-full of finished lots versus generational land assets that still require significant development. Today, I would say what's also got land-hungry builders in California salivating is the John Laing Homes portfolio; earlier this month, the company switched its bankruptcy filing from a Chapter 11 to a Chapter 7, meaning it would liquidate.

So, as I've been in San Francisco for PCBC 2009, I've been asking builders about it. The company's land stock is known to include some super desirable tracts in a number of California's coastal markets, so a lot of players are just waiting for the green light to make a bid to grab the choicest of assets. From what I hear, it'll be between 30 and 60 days before lots actually begin exchanging hands.

The list of potential acquirers is as long as it is distinguished and naturally includes some very familiar faces. Few people know the assets better than the people who purchased them, and with the LandSource bankruptcy most likely wrapping up next month, gums have been slapping about former John Laing CEO Larry Webb putting the band back together again. In fact, from what I hear, the "new co," aptly named The New Home Co., could begin building houses as soon as September. (You've got to love the so-simple-it's-brilliant name with its chuckle-worthy subtleties.)

At the get-go, there will be three legs to the company stool--a Northern California and a Southern California component, as well as a land company. The management team will pretty much look like former Laing management, with Wayne Stelmar, Tom Redwitz, and Kevin Carson among the usual suspects.

The start-up's seed money includes a ton of equity from the management team--when Laing sold to Dubai-based Emaar, some of them saw their investment come back to them many times over--as well as some friends and family money. Additional equity partners are not out of the question. But while this is enough to begin tying up parcels, the big hurdle is finding a financial institution to fund the vertical construction.

This isn't the only new home building company to splash on the scene of late, which makes me think that we've got to be inching closer to recovery. Also earlier this month, California developer Trumark Cos. announced the launch of what it termed a "new generation" home building company, Trumark Homes. The company intends to gain a critical mass by picking up distressed assets. In fact, it recently closed on its first parcel, 4-plus acres in the Inland Empire, and expects to begin construction in August.

I'm looking forward to meeting with Michael Maples, one of the Trumark Homes' principals, later today; I'm just curious to understand why people like him and Webb are confident that now, with true demand so elusive, is the exact right time to go headlong into such an endeavor. I'll let you know what he says.