There’s another possibility, and it’s all business

You’ve all heard the explanations why 2H Construction’s Sean Hitchcock ponied up an as-yet unspecified amount of dough in February to buy 8.38 acres of wetlands at Loynes Drive and Studebaker Road: he wanted to build us a soccer field, and so forth.

But why did developer and puppetmaster Tom Dean sell it to him in the first place? Way back on March 21–the day after 2H workers illegally graded the parcel–we surmised Dean might have sold it as a way of lighting a fire under his still-pending land swap with the city.

There is, however, another possibility: what if he sold the property to Hitchcock to prove its worth?

That makes sense too–selling this eight-acre swath of wetlands, and then using it as some sort of a methane-infused benchmark, against which all his remaining wetlands area might be valued during future real estate transactions.

“I haven’t really heard anything like that, but it does make sense in a commercial market like we’re in,” says Jack Kyser, a founding economist at Kyser Center for Economic Research in Los Angeles. “They’re not lending money out there. It may be a way to establish a value.”

This scenario also makes sense when you consider the land’s provenance, and its last recorded value: $336,402 on June 29, 2005, per the good folks at the Registrar-Recorder’s Office.

Until some time last year, townhouses and double-wides were still fetching that kind of money. You can bet Dean’s 8.38-acre parcel fetched him a few million dollars, and a newly-updated comp–which is just real estate talk for “comparison price.”

Of course, not everyone is so sure he’d do such a thing–even though much of the former Bixby lands haven’t been appraised in modern times.

“You mean like a comp thing? I don’t know,” says Mike Sidney, who works for commercial real estate magnate Cushman & Wakefield in Long Beach–and was actually one of the people who represented the Bixby Ranch Company when it sold the piece of land to Dean three and a half years ago.

“Honestly, I don’t remember if they did appraisals,” Sidney says. “We marketed it and showed it to everyone under the sun. It doesn’t matter what the appraisal says if nobody will buy it. We marketed it on and off for a couple years.”

That comment should strike you as interesting too: the land was on and off the market for a couple years in a boom market, until Dean finally stepped up–and then here we are in the worst recession since World War II, and Dean just magically manages to sell it again. What a coup. apparently.

“It wasn’t actually on the market,” says Cushman & Wakefield’s Stuart Milligan, who works in Los Angeles and headed the team that represented Bixby Ranch Company back in 2005. “Tom Dean always let us know that he’d be interested in buying that property and it came to the point where Bixby Ranch Company trustees decided they’d entertain a offer.”

And Tom Dean bought himself a pig in a poke? That doesn’t sound like something he’d do.

“Well no, I mean, I he bought the mineral rights. We knew what he could do with it. The price of oil went throught he roof and he was the beneficiary of a rich revenue stream based on that,” Milligan says. “It was an 80-year-old oil field. and with new oil extraction methods and with his ability to employ state-of-the-art methods to enhance the revenue stream … .”

You can finish that sentence yourself, but just in case:

“I know he’s a very savvy, successful businessman and he probably made a deal that he thought was in his best interests. And I guess the buyer felt it was a good purchase,” Milligan says of Dean’s sale to Hitchcock.

Guess so. After all, if you read the sale documents, you see one thing plainly: Dean may have sold those 8.38 acres to Sean Hitchcock, but he held onto the mineral rights–and so, every month or every quarter, or maybe just once or twice a year, he still gets a tidy check from some oil company somewhere. Even in this economy.

That’s on top of whatever Hitchcock paid for the land, and it’s also on top of whatever Dean will make from the remaining wetlands he owns–now that he’s armed with a bona fide, recent comparison price. Wow.

It may not be easy being green–but it sounds pretty easy being Dean.

Tags: 2H Construction, Bixby Ranch Company, California, Long Beach, Sean Hitchcock, Southern California, The District Weekly, Theo Douglas, Tom Dean, wetlands grading