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Finally, Ridgemark sold eight parcels of land in a 12-year
period between 1977 and 1989. By comparison, only one
significant purchase of property was made subsequent to
Ridgemark’s 1971 formation (Bushmont property in 1985).
Accordingly, Ridgemark fits the pattern of infrequent but
substantial sales of property which indicates, generally, that it
was held for investment purposes. See Bramblett v. Commissioner,
supra.
4. The Extent of Subdividing, Developing, and Advertising To
Increase Sales
Respondent asserts that Ridgemark routinely subdivided and
incurred substantial improvement costs before selling the land to
either Construction or Financial. Also, respondent contends that
the fact that Ridgemark recorded final subdivision maps on
certain property before the sales were complete demonstrates that
it was involved in the business of dealing in real property.
The seven sales of real property during the 12-year interval
between 1977 and 1989 can be divided into two categories:
(1) Three sales of large unsubdivided parcels, and (2) four sales
in which the title to the property could not be transferred
without a new map being recorded to create a separate legal
parcel.5 Ridgemark contends that the recordation of a final map
5 See Cal. Govt. Code sec. 66426 (West Supp. 1996), which
provides:
A tentative and final map shall be required for
all subdivisions creating five or more parcels, five or
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