Luxury homebuilder Toll Brothers is adding thousands of California building lots to its portfolio by acquiring the homebuilding business of Beverly Hills–based Shapell Industries in a $1.6 billion cash deal announced Thursday.

Horsham, Pennsylvania–based Toll Brothers is a leading designer and builder of luxury single-family and attached homes, with operations in 19 states, including California. By acquiring real estate developer Shapell’s land portfolio, Toll Brothers is adding roughly 5,200 building lots spread across high-growth California markets in the Carlsbad, Los Angeles, Orange County and San Francisco Bay area markets.

Toll Brothers currently owns approximately 4,000 lots in California and says it has already built more than 7,700 homes in the state, bringing in $6.5 billion in revenue since 1994.

Cravath, Swaine & Moore is advising Toll Brothers on the deal, while Shapell has turned to Gibson, Dunn & Crutcher for legal counsel.

The deal—which is expected to close in next year’s first quarter, pending regulatory approval—is the second major transaction in the homebuilding industry this week, as companies look to take advantage of the housing rebound by acquiring developable land. On Monday, Tri Pointe Homes said it had agreed to buy Weyerhaeuser Company’s homebuilding unit in a cash and stock deal worth $2.7 billion. Cravath and Gibson Dunn reversed the roles they played in that deal, with the latter advising Tri Pointe as the buyer while Cravath represented Weyerhaeuser as the seller.

The Cravath team representing Toll Brothers in Thursday’s deal that includes M&A partner Eric Schiele, tax partner Stephen Gordon, real estate partner Kevin Grehan, environmental law partner Matthew Morreale and executive compensation and benefits partner Eric Hilfers. Real estate practice area attorney Gary Eisenman is also working on the acquisition, along with associates Neetin Gulati, Ross Leff and Ankur Patel. John McDonald serves as Toll Brothers’ general counsel.

Meanwhile, the Gibson Dunn team working on the transaction for Shapell is led by Los Angeles–based real estate partners Michael Sfregola and Dhiya El-Saden. Tax partner Paul Issler, real estate of counsel Eric Steiglitz, environmental law partner Patrick Dennis, litigation partner Maurice Suh and employee benefits partner Sean Feller are also advising. The Gibson Dunn associates working on the matterl are Michelle Brossier, Douglas Champion, Annie Deng, Jamie Gowell and Lorna Wilson.