Coastal California real estate developer Five Point went public this past Wednesday and saw some surprising results. Share prices closed more than 7% higher than the initial public offering price, but spiking as high as 10% late that morning.
Backed by the nation’s second largest home builder, Lennar, who invested $100 million in the company for a 40% stake Five Point is on a huge upswing. Like most of the country, California has a booming housing market with no real signs of slow down. Millennials are now purchasing at a faster rate in 2017 than at any other time in past years and Five Point is capitalizing on the demand.
Five Point CEO, Emile Haddad, told CNBC’s “Squawk on the Street” “When the son or the daughter wants to buy a home, the parents are helping them so they can have the grandchildren stay around.” Financial aid from parents is contributing not only to Millennials purchasing at a fast pace but they’re also buying larger or more functional living properties that may have an in-law suite for Mom and Dad to stay in when they come to visit.
Five Point is building for the future as Lennar CEO Stuart Miller said, “We’re not locked into yesterday’s obsolescence, we’re building tomorrow’s opportunities.”
You can see more on this report here at CNBC.
Image courtesy of FivePoint.com