It is time for another West Valley Big Project Update. The projects listed have come about since October 2018. This is not a complete list, but you will get a sense of how fast things are moving in the West Valley.
Lennar purchased 361 platted lots within Zanjero Trails in Surprise at the southwest corner of Cactus and Perryville roads. Lots will range from 6,960 sf to 9,000 sf. Pricing will be from the low $200,000’s to the low $400,000’s. We will most likely see the models open in late 2019.
Pulte and Shea have both closed on lots pre-platted lots at Aloravita in Peoria near the corner of 75th Ave and Jomax. Pulte just opened their phase 1 models in this complex and anticipates this next phase will open in about a year. The homes be 1700-2600 sf on smaller lots with pricing ranging from the high $200,000’s to the mid $300,000’s.
KB Homes is developing a 53-lot subdivision in Glendale at the southeast corner of 83rd Ave and Northern. Homes will range from 1400 sf to 2000 sf, with base pricing estimated to be about $275,000. This project is scheduled to open in October 2019.
Cohen asset management purchased a 153,927-sf industrial space in the Tolleson Business Center on Van Buren. The Tolleson Business Center is about 91% occupied with 11 tenants and is located in a busy industrial corridor in Tolleson.
Taylor Morrison purchased 137 lots at the southeast corner of Waddell and 175th Ave at Heritage Farm in Surprise. Homes will range from 1500 sf to 3200 sf with pricing from the mid $200,000’s to the mid $300,000’s. Models are slated to open 4th quarter 2019.
Pulte purchased 126 lots at the Meadows in Peoria near the corner of 95th Ave and Pinnacle Peak Rd in Peoria. Residences will range from 2200 sf to 3600 sf with pricing from mid $300,000s to the low $400,000.
For those of you familiar with Goodyear, DRA Advisors purchased Palm Valley Pavilions West on the southwest corner of McDowell and Litchfield. Even though we generally think of pricing for fully leased commercial being up, this project sold for 25% less than it was sold for in 2016.
DBM Ventures is planning to build 793,125 of spec industrial warehouse in Goodyear near Van Buren and Bullard. Completion is slated for mid-2019.
- Goodyear Crossing Industrial Park has two new projects:
• Blue Buffalo pet products is building a warehouse/distribution center for the Western U.S and Asia. It should be up and running now.
• Anderson Windows is purchasing 68 acres to build a manufacturing and distribution center serving the western U.S.
Goodyear Crossing Industrial Park is located near Cotton Ln and Hwy 85.
KB Homes purchased 213 lots at the northeast corner of Rooks and Beloat Rds in Buckeye. They will be building homes ranging from 1439 sf to 2541 sf, priced from the low to mid $200,000s. The community name will be Encantada Estates and is scheduled to open in March 2019.
DR Horton purchased more than 77 acres in the Tuscano community at 83rd Ave and Broadway. Homes will range from 1500 to 2500 sf and is scheduled to open 3rd quarter 2019.
Increasing number of office buildings being sold to offshore investors. Examples: The Summit on 16th St & Northern area, North Loop 101 Business Center near Loop 101 & 7th St. In June, Copper Point Tower office building at 3rd St & Central sold for $64.5 million
Apartment buildings are being sold for record numbers: $85,000 – $100,000/unit typical. Example: Canyon Pines on N Black Canyon just south of Union Hills, $9.3 million. Bayside apartments. Several California buyers and off shore buyers.
Quick Examples: the 204 unit Verde apartments sold for $39.5 million (on 68th St behind Mayo Clinic), 160 unit Palms at Glendale sold for $13.2 million (Bethany Home & 67th Ave),
156 unit El Cortez apartments sold for a bit over $12million (near Osborn and 7th Ave),
90 unit Casa Nueva near Greenway & 25th St sold for $7.14 million.
REITs are adding to their portfolios. Paying huge money, expect to see luxury apartment conversions or possible condo conversions. Blackstone just sold 6 of its holdings in the Phoenix Metro area.
Wood Partners – building 237 unit apartment building near 7th st and camelback: Alta Camelback. Just closed on more property in the area and will start 229 unit Alta Marlette near Maryland & 7th St. 1,2 & 3 bedrooms between 705sf and 1525sf., priced $1500-$3000/mo.
Maracay – In June closed on property at the base of South Mountain within the Avance community for 190 residences (second phase). Total of project will be 304 homes ranging in price from $300,000 to high $500,000.
Joseph Carl Homes – Back in business. Looking for finished lots in Phoenix. Example: They recently purchased several lots in Riverbend.
Parc Pinnacle industrial park at Deer Valley Airpark completed and sold May 2018 for $30.3 million. It is 20 acres and at time of sale had tenants signed for 35,000sf of space already. The project is 86,562 sf building, 155,025 sf building and a 70,467-sf building. Mostly full at this point.
DR Horton won the bidding for 269 acres just east of Desert Ridge Oct. 2018. They paid $79 million
Richmond American is constructing 51 homes at Glenrosa and 79th Ave. 1600-2600 sf homes from low to mid $200,000. Opened Fall 2018.
Toll Brothers is building 280 homes at The Meadows (used to be Camino a Lago). Southeast corner Pinnacle Peak & Lake Pleasant Rd. The 694-acre project will contain for projects. Homes will range from 2200sf to 4600sf. Pricing starts high $300,000. Plans on selling to start early 2019.
New River Area Plan – Access the updated plan and information with timeline at District 3 –
Bill Gates page. Water issues: Current concern: small developers splitting parcels and building 4 houses. Don’t need a subdivision report. Water is getting low in wells, no disclosure. We will be working on an education document agents and brokers can give to their clients.
Smart Cities –
Douglas Ranch/Trillium – Buckeye – Buckeye lost the Nikola plant last Fall to Coolidge.
Belmont – Cascade Partners (Bill Gates) – Farther north. I-11 will cut through part of the development. $80 million investment. Just under 20,000 acres north of I-10 & 339th Ave (Travel Centers of Am truck stop). Current plan is for about 80,000 residences and 3800 acres of commercial including industrial space.
Microsoft purchased 258 acres last September just south of Goodyear Airport between Litchfield rd and La Cometa.
PV 303: 618,000 sf Class A spec industrial
City of Goodyear infrastructure and improvement projects.
Estrella Falls Regional Mall – Continues expansion
Several new home developments
Old Lockheed site
Many industrial, Foreign Free Trade Zones, retail industrial space, manufacturing.
Opportunity Zones: We have several here in the West Valley. www.wemargad.org has an opportunity zone map link. It has been a slow rollout because the IRS lagged creating the rules. I will be attending a stakeholder meeting later this month.
91st Ave & Olive – LGE building corporate offices & manufacturing plant for TYR (body armor)
StoneHaven – Homes going in just south of Phoenix Stadium. Joint project of Pulte and John F Long. Small part of corner 91st and Bethany home is commercial. Developer and city want specialty restaurants.
6500 Homes in North Peoria – first homes are being built now. Scott Whyte from Peoria will be our guest at Coffee with the City of Peoria – April 3rd
75th & Loop 101 – Aspera Luxury Apartments
NW Corner 83rd Ave & Happy Valley – Mixed use on 5.5 acres
SE corner 83rd Ave & Happy Valley – 70,000 sf commercial & office
Lots of Medical along the 101 and along 10 west.
Tolleson – completed 402,323 sf food grade industrial space
The Marriott Fairfield Hotel Mayor Tovar spoke of at Coffee with the Mayor last October and the new homes are in.
Avondale – expansion of Vitamin Shoppe building to 187,000 sf west coast distribution center
Avondale – 400,000 sf expansion of San Mar apparel.
The City of Avondale approved and is expecting construction of the remote medical center at 107th Ave and McDowell.
I spoke to Cheryl Covert a few weeks ago, she said Avondale is working on 12 new commercial job creating projects.
Avondale approved the re-design of Lakin Ranch and large master planned community near Broadway and 107th Ave. It will have hiking trails, commercial and residential.
Avondale is investing heavily in their parks. We had coffee with Mayor Weise last August and he told us about several new projects. www.wemargad.org – videos.
ADOT update: Fairway Dr. offramp was approved in December. Next steps being taken.
Harvard Investments has purchased an 847-lot master planned community in Avondale called Verde Trails, west of 107th Ave, along both sides of Broadway. The project will include residential and commercial projects.
Also, in Avondale, Beazer purchased 153 lots at Del Rio Ranch near Buckeye and El Mirage Rd. House will range from 1610 sf to 2919 sf with a projected start price in the mid $200,000s.
Surprise – Lots of new drive throughs: Starbucks and In & Out at Bell and Bullard, Shooters coffee near Greenway & Reems.
Development of Ottawa University at Civic Center. West-Mec campus opened in August. More medical and senior housing near the stadium.
New Rental Product:
Avilla Homes in Goodyear was the first rental only subdivision in the West Valley three years ago. Since then the demand has increased. The model is: townhome or single story detached homes with small backyards, in gated communities with large resort style pool, spa and fitness areas, parks, pet friendly, small backyards with garages. 24/7 onsite maintenance. They are designed for renters who choose to rent and want to maintain the maintenance free lifestyle of an apartment but want to live in a house. They advertise no HOA dues – no mortgage.
Christopher Todd, NexMetro (Avilla Brand) and BB Living are the three most prominent providers of this product in the West Valley. Builders of these and other multi-family hybrid rental product see two rental pools for their product: renters who want to rent and eventually purchase a home, and long-term renters who wish to live in a traditional house and also want the amenities and maintenance free lifestyle they became accustomed to in traditional apartment living.
These builders seek investors and in some cases franchisees. Investors invest in a specific subdivision project. Exhibits of this product type and communities are attached. Here are a few examples:
Avilla Centerra Crossing in Goodyear:
This is the second project in Goodyear for Avilla. This project opened in 2018 on 16 acres and consists of 184 units in a gated community with 1, 2- and 3-bedroom floor plans available, priced from $1,200/month to $1,612/month. Homes have 10-foot ceilings, high end finishes, washer/dryers, covered patio and small backyard. There is a resort style swimming pool and spa, a dog park, onsite management, valet trash and recycling service and 24/7 maintenance.
Christopher Todd On Greenway in Surprise:
Gated single family detached, single story neighborhood. They pride themselves on their technology package included with every home. This community hosts 1- and 2-bedroom units (668 sf to 1,022 sf) ranging in price from $1,195/month to $1,470/month. This community is walking distance to Ottawa University and the Surprise Town Center with Spring Training fields, library and fishing lakes. The community is gated with a resort style pool, spa, firepit and park. Each home is nicely appointed with small patios and backyards, garages are available. 24/7 onsite management.
BB Living at Verrado:
3 &4-bedroom townhomes from 1,749 sf to 2,470 sf. with a loft, luxury finishes, single family detached townhome with high end finishes, washers and dryers, and garage. The community has playgrounds, resort style pool, tennis courts, onsite management, a Rec Room, Ramadas, parks and a pool house. This community has access to Heritage park, pools and gym. Located in the center of Varrado. Rents range from about $1,635/month to $1,795/month.
Clearly this type of rental product is in demand. NexMetro and Christopher Todd (25,000 units in the next 10 years) have announced plans to expand to several thousand units over the next several years in the Phoenix Metro area. BB Living and Toll Brothers announced in early 2019 they will be partnering up to build high end luxury rental home communities in the West Valley and Phoenix Metro area.
This product is built with renters who “choose to rent” in mind and advertises the advantages of not being burdened with HOA fees or a mortgage, living in a high-end new house with beautiful amenities and a no maintenance lifestyle.
These companies are an investor model. You can invest in a single subdivision for as little as $1,000. If you have land to sell, they are actively looking to purchase land and it can be as little as 16 acres. Some of these companies advertise for franchisees.
Now think about this franchise model and Opportunity Zones.
Pew Research conducted a study into the Middle Class in 2017. One of the reports detailed how the “New Middle Class” defines itself compared to the “Middle Class” of 20 years ago. The question posed was “What do Americans consider part of the Middle Class?” Here is their break down:
Middle Class 1991:
70% Homeownership
48% Two or more cars
46% A college education
41% Stocks, bonds, other investments
33% A white collar job
Middle Class 2012:
86% A secure job
66% Health Insurance
45% Own a home
37% College Education
28% Stocks, bonds, other investments
Middle Class 2016:
89% A secure job
86% Ability to save money
45% Time/money for vacation
41% Own a home
30% College education
Clearly owning a home is no longer the overarching goal of American adults. Some of this can be attributed to residual effects of the Great Recession. Millennials would have been old enough to witness parents, relatives and friends losing houses to foreclosure or short sale. In some cases, they may have been old enough to work providing some family income.
Some Baby Boomers lost substantial personal wealth during the Great Recession and either do not qualify to purchase a home or choose not to own a home again. Workers who see themselves as transitory usually choose to rent rather than own.
There is an estimated 1/3 of the potential home purchase population who has chosen to rent long term in order to pay down debt and save 20% or more for a down payment. These long term renters could be a great fill for your future funnel. Keep in mind the last time this country saw a widespread depression in the 1930’s buyer’s started purchasing within 10 years and by the mid 1950’s we were on our way to the largest home ownership numbers in the history of the country with 20% down payments being the norm.
The Depression generation purchased later, but their first house was not a typical first house. It was bigger and more luxurious. At the same time their children started purchasing their first home.
In my data base of past clients, the oldest Millenials are now starting to purchase homes. And their parents who were distressed homeowners in 2010 are looking at purchasing again.
I just completed the housing data report for the Luke Strategic Growth Plan. WeMAR is a stakeholder. They are looking to expand the number of F-35s, so watch for more active duty military. They are targeting the half hour drive around Luke as places to house these folks. Geographically we are looking at roughly 59th Ave to Buckeye, West Laveen to Wittman.
I hope this quick update will help you find your niche client, build your business and become more aware of the varied opportunities at your doorstep.