Indianapolis-based Scannell Properties acquires 17.1 acres in the Tejon Ranch Commerce Center to build a state-of-the-art, sustainable automated manufacturing facility for Plant Prefab, an award-winning custom builder of high-quality multifamily and single-family housing

(Tejon Ranch, CA) – Tejon Ranch Co. (NYSE: TRC) announced today it has closed on the sale of 17.1 acres of land on the east side of the Tejon Ranch Commerce Center to Scannell Properties, a privately-held real estate development and investment company that focuses on build-to-suit and speculative development of industrial, office and multifamily facilities throughout the U.S., Canada and Europe. There, Scannell will build an approximately 270,000-square-foot manufacturing facility for Rialto, CA-based Plant Prefab.

This new factory – Plant Prefab’s third – will serve as the company’s first automated facility and regional production hub, and will be purpose-built to efficiently manufacture custom-prefabricated panelized and modular building components. The hub facility will allow for the full industrialization of Plant Prefab’s patented Plant Building System™️, which combines advanced engineering with specialized Plant Panels™️ and Plant Modules™️ to build custom housing 20 to 50 percent faster than traditional building methods with up to 30 percent less waste at a 10 to 25 percent cost savings in labor-constrained markets.

“The Tejon Ranch Commerce Center is an outstanding location –with its efficient access to the interstate and strategic location between Los Angeles and the Bay Area, combined with the efficiencies that will be driven by the state-of-the-art facility, Plant Prefab will be able to expand its reach to the entire Western U.S.,” said Jacob Holdeman with Scannell Properties.  “They are establishing their flagship facility in a location that represents a strong value proposition when compared to the Inland Empire and joining an area that is expected to continue growing for decades.”

Steve Glenn, Founder and CEO of Plant Prefab, stated, “Opening the hub facility will be a critical milestone that will move Plant Prefab into the next phase of our evolution, enabling us to construct architectural, sustainable housing more time and cost efficiently, and at higher volumes than we could previously. It will also allow us to expand into larger dwelling formats including large-scale student, affordable and market-rate housing to serve a wider universe of clients including real estate, hospitality, and corporate developers. This represents a significant step toward our ultimate goal of helping to address critical housing issues in supply- and labor-constrained markets.”

Plant Prefab’s design and estimating teams are now engaging projects for the new facility, which expects to begin production in January 2023. The launch of the hub will be well timed to help Plant Prefab accommodate rising demand from a growing list of clients, as production contracts have grown by more than 175 percent in the past year alone. Looking ahead, Plant Prefab expects to replicate its hub-and-spoke production model, allowing it to scale efficiently to meet demand across urban infill markets in other regions across the country – including the East Coast – that are similarly well located and primed to serve large populations.

Joseph N. Rentfro, Tejon Ranch Co.’s Executive Vice President of Real Estate, added, “Along with the County of Kern, which awarded Plant Prefab an incentive under the Advance Kern Initiative, we look forward to welcoming this innovative company to Tejon Ranch, as we share their commitment to helping address California’s housing crisis in an efficient, sustainable way. This investment by Scannell Properties, which can – and does – invest all over the world, is further evidence of the strength and appeal of our location. All of our existing industrial space is 100% leased and 100% occupied, and we’re making good progress on a +/- 630,000-square-foot speculative industrial facility we’re building in partnership with Majestic Realty Co., as we look to meet the demand we’re seeing out of Southern California and elsewhere for warehouse, distribution, and now,  advanced manufacturing facilities, with Plant Prefab’s new manufacturing hub serving as an example of the type of business identified as a targeted sector for business development in Kern County by the B3K endeavor.”

Tejon Ranch Co. is a participant in B3K Prosperity, a collaboration among business, government and civic stakeholders in Bakersfield and Kern County, whose purpose is to create and deliver a joint strategy and investment plan for regional economic growth and opportunity.

Centennial to be both net-zero energy and net-zero GHG emissions community

Tejon Ranch Co. (NYSE: TRC) and Climate Resolve, a Los Angeles-based nonprofit organization, today announced an unprecedented agreement regarding the Centennial at Tejon Ranch master planned community. The planned development of more than 19,300 homes and 10.1 million square feet of commercial and industrial space, which has received approvals from Los Angeles County, may now proceed to the next steps in the California development process.

Centennial, which has committed to include 3,480 affordable housing units as a part of its Los Angeles County approvals, will now also become a greater net zero project, meeting and exceeding all the state’s goals and requirements to combat climate change.

The enhanced climate and wildfire resilience measures contained in the agreement set a new standard for development in California and represent the largest climate investment by a housing development in the state, a milestone achieved through the cooperation of both Tejon Ranch and Climate Resolve.

As part of the agreement, Climate Resolve has agreed to dismiss with prejudice its claim that the County of Los Angeles violated the California Environmental Quality Act (CEQA) when it approved Centennial in May of 2019.

With the dismissal of the lawsuit, Tejon Ranch Co. retains the legislative approval needed to continue the process that will lead to the development of a well-planned and critically needed community that will bring thousands of homes and jobs to Los Angeles County. 

The agreement includes the following measures and features.

 “We are pleased to reach this agreement with Climate Resolve that will enable us to address California’s housing crisis in the most sustainable manner possible,” said Gregory S. Bielli, President and CEO of Tejon Ranch Company.  “Tejon Ranch has a legacy of environmental stewardship, as well as using its land to meet major needs in California.  More than ever, the state desperately needs the 19,333 housing units Centennial will provide, including the nearly 3,500 affordable units.  At the same time, California needs to achieve its climate goals.  This agreement outlines a way to create this unique climate-friendly, fire-safe, affordable mixed use master planned community that helps California address its housing needs consistent with the state’s policy goals.”

“Working with Tejon Ranch, we’ve been able to secure the largest climate commitment by a housing development in the state’s history,” said Jonathan Parfrey, Executive Director of Climate Resolve.  “We’re setting a new climate standard that surpasses anything previously done in the state. Our agreement builds upon the 2008 Tejon Ranch Conservation and Land Use Agreement and takes the added steps of further protecting the land from the threat of wildfire and zeroing-out greenhouse gas emissions at the Centennial project.”

Both Tejon Ranch Company and Climate Resolve look forward to working together to implement an agreement that sets a new precedent for the development of fire safe, sustainable communities that will meet the needs of California today, and in the future.

Center for Biological Diversity and other environmental groups withdraw previously announced appeal of District Court ruling

(Tejon Ranch, CA) The Center for Biological Diversity, along with the other plaintiffs in a lawsuit that challenged the 2013 approval of a Multi-Species Habitat Conservation Plan covering the upland regions of Tejon Ranch, have voluntarily dismissed with prejudice their appeal of the ruling by the Federal District Court that granted summary judgment entirely in favor of the US. Fish & Wildlife Service and Tejon Ranch Co. The Habitat Conservation Plan—a permit issued in compliance with the Federal Endangered Species Act—will protect the California condor and other species found on Tejon Ranch.

In his December 2020 ruling granting summary judgment for Tejon Ranch and the US Fish & Wildlife Service, United States District Court Judge Cormac J. Carney resoundingly rejected every argument made by the Center for Biological Diversity (CBD), Wishtoyo Foundation, and Delia Dominguez, the plaintiffs in the lawsuit. The court went so far as to characterize CBD and the other plaintiffs’ arguments as “unsupported by the record” and noted that CBD tried to “misleadingly suggest” its position was based on law.

The plaintiffs’ lawsuit was initially filed on April 25, 2019, a full six years after the approval of the Habitat Conservation Plan, and just four days prior to the expiration of the period in which to file a legal challenge.

Following the court’s December 2020 ruling, the plaintiffs announced they would appeal the decision to the 9th Circuit Court of Appeals. However, they never filed any legal briefs with the court and ultimately filed a motion with the court to dismiss their appeal. With the issuance of the Court Order, the appeal is permanently dismissed and cannot be filed again.

The tactics employed by CBD to litigate, delay, and obstruct proposed housing developments throughout California, including Tejon Ranch, are a significant contributing factor to the housing crisis in California. As CBD pursues its agenda, which, as stated by CBD co-founder Robin Silver, is ‘to inflict severe economic pain,’ those burdened by that economic pain are the countless numbers of Californians who find adequate housing increasingly unavailable and unaffordable.

Even in the face of this onslaught by CBD and other environmental groups who rush to court to try and derail Tejon Ranch’s efforts to responsibly develop its landholdings and create thousands of homes and jobs for Californians, Tejon Ranch Company remains fully committed to the ongoing stewardship of the ranch’s 270,000 acres, as it has done for over 175 years.

              Directors vote to add land use attorney Susan K. Hori

(Tejon Ranch, CA) Tejon Ranch Co. (NYSE: TRC) today announced the addition of Susan K. Hori to the Board of Directors of Tejon Ranch Co.   She will join the Board effective December 1, 2021.

Ms. Hori is a partner and land use attorney with Manatt, Phelps & Phillips, LLP, where she also serves as the head of the Firm’s Orange County office.  Her practice focuses on obtaining land use development entitlements for landowners and developers, including local land use approvals, California Environmental Quality Act (CEQA) compliance, and state and federal regulatory agency permits for real estate development projects.

“We are very pleased to have Susan Hori join our Board of Directors,” said Gregory S. Bielli, president and CEO of Tejon Ranch Co. “She has extensive experience and a distinguished legal career, and undoubtedly will be a tremendous asset for Tejon Ranch Co. as a member of the board.”

The hallmark of Susan’s practice is her track record of success in navigating the complex process of multiagency permits and approvals. Her clients include landowners, financial institutions, developers and builders in the residential, retail, hotel/resort, and commercial and industrial development industries.

“I’m honored to join the Tejon Ranch Co. Board of Directors,” said Hori. “The 270,000-acre Tejon Ranch is vitally important as a housing and job creator for California, and I look forward to joining with other board members to guide the Company as it unlocks the value inherent in the land for the benefit of its shareholders and stakeholders.”

Ms. Hori graduated magna cum laude from the University of Washington and earned her law degree at the University of California, Berkeley.  Prior to entering private practice, Susan clerked for the Alaska Supreme Court and served as an attorney with the Solicitor’s Office in the Department of the Interior in Washington, D.C., where she represented the U.S. Fish and Wildlife Service.

In addition to Hori, the members of the Tejon Ranch Co. Board of Directors include Board Chairman, Norman J. Metcalfe, and directors Steven A. Betts, Gregory S. Bielli, Jean Fuller, Anthony Leggio, Frawn Morgan, Geoffrey L. Stack, Daniel R. Tisch, and Michael H. Winer.

FINISH LINE IN SIGHT FOR EFFORTS TO BUILD NEARLY 20,000 HOMES IN LOS ANGELES COUNTY

Some additional analysis required on small number of issues

Los Angeles, CA (April 2021)   Los Angeles Superior Court Judge Mitchell Beckloff has determined that the overwhelming majority of the Environmental Impact Report (EIR) for the master planned mixed use community of Centennial at Tejon Ranch is satisfactory, denying 20 of the 23 claims raised in two separate environmental lawsuits filed under the California Environmental Quality Act (CEQA).

The judge rejected all claims raised by the Center for Biological Diversity and the California Native Plant Society.  He also found that certain narrow aspects of the EIR related to the analysis and mitigation of greenhouse gasses and off-site fire risk needed further analysis or clarification.  In most of the issues related to greenhouse gasses and fire risk, including Centennial’s wildfire protection program, the court ruled in favor of Tejon Ranch and Los Angeles County.

“We want to thank the judge for his careful attention to this case’s numerous issues, especially his affirmation that Centennial is a fire-resilient community,” said Gregory S. Bielli, President and CEO of Tejon Ranch Co.  “Environmental impact reports are extremely lengthy, complex documents, and it’s difficult to get everything perfect the first time out. With the judge’s direction, we will work with LA County to address the few remaining issues, just as we did in Kern County when a court ruled the EIR for our Grapevine community needed additional analysis.  The analysis was completed, Grapevine was reapproved, and the court affirmed the additional analysis was correct. We expect the same will be true for Centennial.”

Centennial, which is located in the Western Economic Opportunity Zone designated in the Antelope Valley Area Plan and the Los Angeles County General Plan, consists of 19,333 residential units, 18% of which are affordable units, and more than 10.1 million square feet of commercial space providing retail and business park uses.  It will also produce a wide array of employment opportunities. In addition to much-needed housing, Centennial is projected to create more than 23,000 permanent jobs on site and nearly 25,000 construction jobs.

While the California Environmental Quality Act was created for an important purpose, it has been hijacked by extreme environmental groups such as the Center for Biological Diversity (CBD) to try and stop all housing and job creation opportunities in California, ultimately denying millions of Californians an opportunity to own a home of their own and provide for their families.

CBD’s lawsuit filed against Tejon Ranch was the third CBD has lost in the last five months and was its 13th legal action taken against Tejon Ranch and its interests since 2003.  CBD’s goal is to undermine and prevent the development of Tejon’s master planned communities, which will provide 35,000 desperately needed new homes for Californians.

The concerted efforts by CBD and other extremist groups only serve to worsen California’s housing shortage and drive home costs ever higher.  CBD’s actions are consistent with their philosophy which advocates for “reducing the human population” because, in the words of CBD co-founder Kieran Suckling, “there’s too many damn feet.”  Through its strategy of filing lawsuit-upon-lawsuit, CBD aims to, according to another co-founder, Robin Silver, “inflict severe economic harm.”  Regrettably, the ultimate victims of CBD and these other groups’ short-sighted strategies are hard-working Californians who desire a home they can afford and an opportunity to better themselves and their families.

Tejon Ranch Co. is ready to do its part to help solve California’s housing crisis, to build the homes and create the jobs that California so desperately needs, so it is anxious to resolve the issues noted by the court as quickly as possible.

http://tejonranch.com/Online-2020-Annual-Report/

This Annual Report and Shareholder Letter for 2020 marks a transition to a digital format.  By using this format, we can cover more topics and provide additional information, allowing you the opportunity to take a deeper dive into the company and our various business segments.

ENVIRONMENTAL GROUPS MAKE LAST MINUTE ATTEMPT TO CORRECT MAJOR ERROR IN A DEFECTIVE LAWSUIT REGARDING THE TEJON RANCH CONSERVATION AND LAND USE AGREEMENT

Failure to include the Tejon Ranch Conservancy as a plaintiff in original lawsuit was a material defect and subject of a pending court hearing

 

Tejon Ranch, CA (January 26, 2021)  Following the filing of a Motion to Dismiss by Tejon Ranch Co. based on the fact that the environmental groups who are party to the Tejon Ranch Conservation and Land Use Agreement (RWA) previously filed a lawsuit containing several fatal defects, those plaintiffs, Audubon California, Endangered Habitats League, Natural Resources Defense Council, Planning and Conservation League, and Sierra Club (Resource Groups)—at the last minute–have attempted to correct the errors in the defective complaint by adding the Tejon Ranch Conservancy to the complaint as a named plaintiff.  This eleventh-hour effort to correct such a sloppy and glaring error relates to only one of the numerous defects in the complaint that Tejon Ranch Co. has raised in its motion to dismiss. The Resource Groups made the attempt to salvage their misguided accusations only when a hearing by the court on their defective approach was imminent.

This suit is an improper attempt by the Resource Groups  (and presumably the Conservancy)—who are all in material and incurable breach under the RWA—to pressure Tejon into abandoning its right to escrow payments under the RWA as a consequence of that breach and, further, is an attempt to evade the consequences of Plaintiffs’ years of mismanagement of the Conservancy, and the squandering of over $11,000,000 in payments contributed by Tejon to date. The Complaint continues to be materially defective and should be rightfully dismissed.

Background

Tejon Ranch Company has an ethic of stewardship and a legacy of protecting ranch lands spanning more than 175 years.  In 2008, it voluntarily entered into the Tejon Ranch Conservation and Land Use Agreement with major environmental organizations to ensure this legacy would continue on a massive scale—90% of the ranch, 240,000 acres of open space permanently conserved for future generations. To ensure the conservation easements on these lands would be managed, the Tejon Ranch Conservancy was created.  Since 2008, Tejon Ranch has contributed $11 million to the Conservancy as called for in the RWA, fulfilling its obligation year after year.

In short, all of Tejon Ranch’s obligations to date in the RWA have been performed; and Tejon intends to continue to perform its obligations under the RWA. But it also must ensure the Resource Groups and the Conservancy perform their obligations.

Unfortunately, the Conservancy (which has a governing board of 12 which is controlled by Board Chairman Joel Reynolds and other appointees of the Resource Groups) has largely squandered this original funding, and has failed to take appropriate steps for self-preservation (including failing to establish adequate reserves or to undertake any effort to ensure long term funding for the Conservancy’s obligations).

Not only has the Conservancy been derelict in its fundamental charge to become self-sustaining, but several of its Board members, in particular the Resource Groups’ representatives, have utterly ignored the primary (if not singular) benefit Tejon receives in the RWA: Their obligation to not oppose or hinder the development of the ten percent (10%) of the Ranch reserved for development. More specifically, Plaintiffs breached the RWA by, among other things, creating, organizing, orchestrating, leading and participating in the publication of a regional biological conservation strategy that included a portion of the Ranch within the strategy’s study area and which is presently being used against Tejon by the Center for Biological Diversity (and the California Native Plant Society) to challenge the very development projects the RWA was intended to permit.

Inclusion of a portion of the Ranch in this strategy document occurred despite express assurance by the designated representative of the Resource Groups (who is also a Conservancy board member and representative of the Planning and Conservation League) that the Ranch would not be included. Therefore, as permitted by the RWA, Tejon has reluctantly, but properly after the Resource Groups’ refusal to cure this breach, deposited the October 1, 2020 and January 1, 2021 advance payments into a third-party escrow account where the funds will be held until Plaintiffs meet their non-opposition obligations under the RWA. In accordance with the terms of the RWA, until such time as breaches by Plaintiffs are remedied, if that is at all possible, Tejon intends to deposit into escrow the remaining advance payments to the Conservancy it is entitled to do under the RWA.

After all, in the words of Conservancy Board Chairman Joel Reynolds, “a deal is a deal.”

COURT RULES IN FAVOR OF TEJON RANCH AND KERN COUNTY REGARDING

RE-APPROVAL OF GRAPEVINE AT TEJON RANCH MASTER PLANNED COMMUNITY

TEJON RANCH, Calif.—(January 22, 2021)—Kern County Superior Court Judge Kenneth C. Twisselman today rejected, in its entirety, the most recent lawsuit filed by the Center for Biological Diversity (CBD), a Tucson, Arizona-based extremist environmental organization, that challenged Kern County’s December 2019 re-approval of Grapevine at Tejon Ranch, a master planned mixed use residential community.

In December 2016, the Kern County Board of Supervisors unanimously approved Grapevine. CBD sued the following year, and subsequently lost six of the seven issues it raised regarding the sufficiency of the project’s environmental impact report. On the seventh issue—the court ruled that there was a deficiency regarding the internal capture rate used in the traffic study—and ordered the County to submit a revised environmental impact report reflecting the court-ordered additional work – but upheld the remainder of the environmental impact report.

The supplemental re-circulated environmental impact report showing the changes to the internal capture rate analysis was subject to a full public review and comment process and was ultimately re-approved unanimously by the Kern County Planning Commission and Board of Supervisors in 2019. The County’s approval was challenged yet again by CBD, first in a late-hit letter filed one day before the Board of Supervisors met to consider the project, and then again in court.

In today’s ruling, the court rejected CBD’s attempt to re-litigate issues it had already sued on and lost. It also determined that the County’s supplemental analysis of the internal capture rate, as ordered by the court, was complete and in full compliance with the court’s earlier ruling. The court also expressly rejected each of CBD’s new claims, including those that attempted to re-litigate earlier claims that CBD had itself assured the court in writing that CBD would not-re-litigate.

“We are extremely pleased the court thoughtfully and thoroughly considered the issues, found that we had satisfied the court’s original ruling and decided to rule against the claims in this latest lawsuit,” said Hugh F. McMahon, Executive VP of real estate at Tejon Ranch Co. “Once again CBD tried to hijack and abuse the California Environmental Quality Act in their continued attempts to prevent any and all thoughtful and responsible real estate development in California.”

The lawsuit was the 12th legal action filed by CBD against Tejon Ranch and its interests since 2003. CBD’s concerted efforts to likewise delay Tejon Ranch’s Centennial and Mountain Village master-planned communities, which together with Grapevine will provide 35,000 new homes for Californians, only serve to worsen California’s housing shortage and drive home costs ever higher. The lawsuit comes a month after CBD lost yet another lawsuit challenging Tejon Mountain Village.