Desert Creek at Las Sendas in Mesa Acquired by Ryland – Planned for 145 Lots

VIZZDA—September 9th, 2013 — Ryland Homes closed on the first of two phases within Las Sendas, a largely built out 2,432 acre master-plan in North Mesa, Northeast of Power & McDowell Roads. The subject community is to be called Desert Creek.

The sale price was $3.325M or $219,864 per acre for the roughly 15-acre parcel. City zoning documents indicate the subject sale portion is planned for 102 detached lots, with a minimum area of 2,399 ft2 and a minimum 30’ width. The second phase will comprise 43 lots, with the entire community to total 145 lots on 22.73 acres zoned RM-2 PAD for a project density of 6.38 density units per acre. Maximum height is 30’ for the two story units. Homes are expected to be 1,600 to 2,400 SF and average $275K.

The seller was an entity formed by Mr. J Chris Arnold of the UCI Companies, whose history within Las Sendas dates back to late 1990’s as part of a larger land holding. A related in conveyance in 2008 brought the 50.75 acre parent parcel (known as parcel 51) into the current ownership entity of Mr. Arnold who entered a development agreement with the City of Mesa with plans calling for:

·       180 condo units on 20 net acres

·       506K SF of office & retail (65’ max height)

·       160 room hotel

2008 plan referenced here.

Parcel D of Desert Creek at Las Sendas as it is currently planned

Part of the development stipulates that the residential component must be phased with a defined amount of non-residential development to be completed before the second residential phase can begin. On June 15th, 2012, 5 acres of parcel 51 was sold to IASIS Healthcare for $6.43 per ft2 or $280,057 per acre. The zoning for the planned 145 detached units represents a reduction in density from the agreed upon 180 condo units and was approved by Mesa City Council July 2013.

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GSO Capital buys 106.31 acres in Peoria for $16.5m

Vizzda – August 8, 2013 – GSO Capital purchased 106.31 acres of “The Meadows” in Peoria for $16.5m or $155,206 per acre from Communities Southwest. An additional aspect of the deal is that K Hovnanian Homes has optioned the land. GSO Capital has worked closely with K Hovnanian Homes, providing a $250m cash infusion in 2012 (LINK) and operating as a land banker for K Hov. Steve Benson of Rose Asset Management was GSO Capital’s contact for the deal, while president Mike Kern and executive vice president Luka Vignjevic handled the deal for Communities Southwest and Chad Fuller represented K Hovnanian Homes.

From the Communities Southwest website (LINK):

The Meadows is a planned 694 acre residential community located in Peoria, Arizona at the northwest corner of 91st Avenue and Deer Valley Road. This community is planned to include a variety of single family residential lots sizes with potential densities ranging from 3.6 dwelling units per acre down to 1.1 dwelling units per acre. Residents will enjoy a vast network of landscaped common areas, a 10-acre City Park, a centralized elementary school, and a community pool and recreation center all linked by a network of community paths and trails.

Communities Southwest acquired this land as 694.14 acres from the State of Arizona on April 11, 2007 for $61.1m or $88,022 per acre with $6.11m down, an administrative fee of $860k – this figure including a $500k broker fee – and $5.99 m debt with the State of Arizona; the note bears a 10.76% rate of interest, 25-year amortization schedule and matures on February 15, 2014, at which time the balloon payment of $51,367,845 is due in full.

Edward Moore
Director of Research

emoore@vizzda.com
www.vizzda.com

Mattamy Homes Picks Up ~80 Acres in Goodyear, Planned for 218 Lots

VIZZDA—June 24th, 2013 — Mattamy Homes, represented by their VP of Land, Ryan Huffman, has acquired an 80.22 net acre graded parcel in the Palm Valley subdivision of Goodyear. Following final plat approval by Goodyear Town Council on January 28th, 2013, the land is approved for 218 single-family homes, as the residential portion of Palm Valley, Phase IX. The all cash purchase price was $9,626,400, which represents per unit prices of $120k per acre, $2.75 per square foot and $44,158 per planned lot.

The property has an interesting history: it was assembled on December 31st, 1986 as a larger parcel in a cash transaction. A 145.43-acre portion was sold to Southwest Solar Technologies on November 25th, 2009 for $6,348,500 or $1.00 per square foot. While Southwest Solar did not finance the transaction, they secured $2.8m in new debt with affiliates of Apollo Group on April 1st, 2011.The current seller, an entity formed by Crown West Realty with backing from Petrus Partners of New York acquired the property from Southwest Solar three weeks after it was encumbered.

The prior sale price of $3.9m or $0.61 per square foot represents a 38.5% decline in value over an 18-month holding period. Conversely, Crown and Petrus were able to realize 146.8% rate of return over a holding period slightly greater than two years. Pursuant to the April 12th, 2013 purchase agreement between Crown West and Mattamy, Crown West retains the 8.75 acre multi-family parcel on the hard corner to the southeast and Mattamy will construct and be reimbursed for horizontal improvements on that land.

By:

Paul Dionne

Director of Analytics

Vizzda.com

Marketplace One Realizes 47.5% Annualized Rate of Return on Sale of Surprise Acreage

VIZZDA—May 8th, 2013 — Tim Brislin of Harvard Investments paid $14.35m for 359.91 acres of roughly graded residential land within the Desert Oasis and Sunrise Ranch subdivisions in Surprise. The sales price represents a $39,871 Per Acre Price and a $0.91 Per Square Foot Price. Harvard paid cash for the property and annexed 1.27 adjacent acres pursuant to an outstanding agreement prior to the acquisition.

Desert Oasis is planned for 2,691 total lots and Sunrise Ranch is planned for approximately 400 total lots. The portion which conveyed to Harvard Investments was comprised of the final 229.64 acres of unfinished land within Desert Oasis and substantially all of Sunrise Ranch’s 130.27 acres. The two subdivisions are located west of the northwest corner of 163rd Avenue and Jomax Road. They were assembled and entitled by Desert Troon and Centex Homes before selling to Marketplace One in 2011.

Marketplace One and its partner, BayNorth Capital of California, acquired the parcels—less the property annexed in this transaction—for $7.08m or $19,721.24 per acre and $0.45 per square foot—on March 3rd, 2011 in an all cash purchase. The current sale price of $14.35m reflects an absolute rate of return of 102.6% which annualizes to a greater than 47.5% rate of return.

By:

Paul Dionne

Director of Analytics

Vizzda.com

Historic Family Holdings at Higley and the 202 Sells for ~$6.38m

VIZZDA — 4/29/2013 — An entity formed by the Taddei Family of Hunter Contracting, sold a roughly 40-acre parcel in Gilbert after taking possession of it prior to 1997.

Warner Gabel III of Gabel Investments in Scottsdale acquired the parcel for $6,383,381 or $160,105 per acre. 

Gabel filed a Regulation D offering with the Securities and Exchange Commission on April 20th, 2013: offering $7.1m in equity and receiving a total subscription of $6.975M. 

Follow the link below to access the filing: http://www.sec.gov/Archives/edgar/data/1575125/000157512513000001/xslFormDX01/primary_doc.xml

The property consists of 39.87 acres of land, zoned RU-43. Aerials indicate the property is used in agricultural production.

By:

Hadden Schifman

Managing Principal

Vizzda 

Lennar Acquires ~16 Acres in Ahwatukee Foothills, Plans Seventy Lots

Vizzda—March 20th, 2013 — David Bruner, President of DMB Circle Road Partners and former COO of DMB Associates, Inc., sold 16.12 acres of residential acreage in the Foothills Club West subdivision of Ahwatukee to Lennar Homes for $3.075m or $4.38 per ft2. Lennar took the property through the entitlement process at the behest of DMB Circle Road prior to taking ownership.

Following final approval by the City of Phoenix on Januray 16th, the site was rezoned from PCD to R1-8 and platted for seventy 2-story single family residences. Typical dimensions for the lots are 45’ x 105’-110’ for an effective project density of 4.4 density units per acre. The lots have set back requirements of 15’ for the front and rear and 10’ for the sides.

DMB Associates, Inc. previously acquired the land as part of a larger assemblage on June 28th, 1996 for $1.152m. On December 28th, 2001, the larger property was transferred into a joint venture between DMB and Circle Road Equities. No debt was located for either the current or previous owners and the all-cash purchase price reflects a per lot price of $43,928 and a per front foot price of $946.

By:

Paul Dionne

Director of Analytics

Vizzda.com

Elliott Homes Assembles Nearly 430 Acres for ~$16.43m

VIZZDA—March 4th, 2013 — In what is easily the largest land transaction of the New Year, Elliott Homes has acquired 429.20 contiguous acres of agricultural land in Waddell in four transactions totaling $16,430,230.10 for an average per acre price of $38,281.05. National Safe Harbor Exchanges, a 1031 exchange intermediary, facilitated the all cash transaction between Elliott—represented by Stephen Hemington and Brian Spickard—and four separate owners. A representative of the sellers indicates that this sale was a reverse 1031 exchange.

The largest portion acquired by Elliott is a 183.76 acre contiguous parcel sold by Ronald Schut of Miedema Produce for $7,019,208 or $38,197.06 per acre. A non-contiguous parcel totaling 115.68 acres was sold to Elliott by Darrell and Diane Kuiper for $4,453,790 or $38,500.95 per acre. Kelvin and Kathryn Moss sold a contiguous 76.71 acre parcel for $2,860,336 or $37,287.65 per acre. Finally, Mitchel Medigovich unloaded 53.05 non-contiguous acres $2,096,896 or $39,526.78 per acre. The assemblage is zoned RU-43 and located at the Northwest corner of Citrus Lane and Olive Avenue.

With the exception of that portion sold by Medigovich, these parcels were previously acquired in a simultaneous transaction on January 20th, 2012 in which Wayne Smith, owner of W.L.S. Construction, acquired roughly 399 acres in two transactions for $5,563,596 from Mark Winkleman of ML Manager—the court-appointed receiver for Mortgages Ltd. Smith then sold 183.76 acres for $2,724,561, 115.68 acres for $1,728,773 and 76.71 acres for $1,110,262 the sum of which exactly equals Smith’s basis. The Medigovich portion was previously acquired at a pair of trustees auctions in Q1 2012 with a combined credit bid of $5,309,534.

Kohner Properties assembled the land in several transactions beginning in December 2004 and encumbered it with $24m in new debt with Mortgages Ltd. on January 4th, 2005. Following the collapse of Mortgages Ltd., the property was noticed for trustee sale on October 30th, 2009 and it reverted to ML Manager as successor beneficiary on May 25th, 2011 with a$3.614m credit bid. Per City of Glendale planning documents, the site had previously been planned for the 1,144 lot Turning Leaf at the Meadows subdivision.

By:

Paul Dionne

Director of Analytics

Vizzda.com