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2500 Home Development in Tucson May Revert to Original Owners

Word has it that the development known as Saguaro Springs, a 2,500 home development in Marana, AZ (near Tucson) may have tanked, and will revert to the original sellers for the original sales price of $30,000,000., resulting in a loss of approximately $70,000,000 for a national developer who has invested that amount in roads and infrastructure.

Situated to the north of West Twin Peaks Rd in Marana, and west of Interstate 10, the project is an anchor of Marana's spectacular growth. The setback may hold up the planned construction of the Twin Peaks interchange at I-10, the cost of which will be paid not by the federal government, but by private development companies. It's unclear what the effect may be on the yet-to-be-built Marana Spectrum, a lifestyle mall approved by the Marana Council on the east side of the proposed Twin Peaks interchange. Marana Spectrum is expected to open in 2010.

As the infrastructure for Saguaro Springs is complete, or nearly so, there's no doubt that the project will find another builder. It's just a question of when.

And that's the real estate opinion of this Tucson, Arizona mortgage lender,

Mike in Tucson
Think of me as your local expert

image by Google Earth

Posted by Mike Jones on 02/08/2008 06:59 AM

Comments (26)

relocation package, mike in tucson, active rain, tucson, saguaro springs, marana spectrum, lifestyle mall, mortgage, arizona

Originally posted at: Tucson By Choice!: 2500 Home Development in Tucson May Revert to Original Owners

This post has been included in Arizona Information Pima County, AZ Information Marana, AZ Information

26 Comments on 2500 Home Development in Tucson May Revert to Original Owners

FEB

2008

So, Mike! What exactly is a life style mall? Haven't heard that one before!

Wow - that's a pretty sizable loss. It's sounds like an opportunity for someone.

Pat,

Here's a link to the article that describes the proposed mall.

Elizabeth,

I'm sure it will be an opportunity. Stay tuned.

Mike in Tucson

Mike,

I have seen this same thing going up here in Phoenix, but not to that magnitude. A lot of the national home builders are selling back their land to the investor they bought it from with contracts to buy it back later. All the builders are in a liquidation state right now until they can get a better footing on this new market. Great Post

Well Mike, I'm not surprised given the state of our economy now. I don't know of anything of this magnitude but I am seeing smaller developers tanking too and trying to sell out their entire development. It's a bumpy ride but things can change in a big hurry too.

That is very interesting. It will also be interesting to see what happens to it and what the repercussions are in the area. Good post.

That is alot of money to lose if things don't work out. Whew!!

Mike, So what happens now to the property? Is it just going to sit their partial developed? Sounds like a real mess

7 Comments on 2500 Home Development in Tucson May Revert to Original Owners

So, Mike! What exactly is a life style mall? Haven't heard that one before!

02/08/2008 07:17 AM

by Patricia Kennedy

Life style malls started many 15 years ago. They have all the big name stores. Everything is outside rather then having to walk inside or roofed.

Mike: Interesting post and more than likely happening in other places too. That's a sizable loss!

Ouch! A huge loss for someone, yet a terrific opportunity for someone else to jump in and make a statement.

With any luck at all, it will take some time for a new developer to come in and start building. The last thing we need right now is 2500 more homes on the market! I understand that Red Rock is hurting, and they can't give 'em away in Continental Ranch and Gladden Farms. We need to allow some time for the existing homes to sell and bring the inventory down. As for the mall - at least there will be somewhere for all those people to shop, but it might be difficult for the stores to succeed...remember what happened to the Foothills Mall?

Just my opinion!

Mike, Do you think that the original owner might be inclined to sell individual lots?

Bill Roberts

Please keep us posted on how the event unfolds.

When I was in India, there were a bunch of "investment oppotunity" ads for large parcels in Florida such as this. With the value of the dollar so poor in Europe, there is a great amount of European investment in New York City...maybe it will trickle to the south and west too.

This is only the tip of the iceberg in my opinion...new construction is taking a huge hit . In our area the largest inventory that is sitting is the new construction...a lot of people will lose their jobs!

FEB

2008

Joan,

New construction is taking a big hit; I agree. I'm glad, though, that the project stalled at this stage instead of after the homes were built, give our inventory in Tucson.

Tina,

Overseas investment due to the relatively weak dollar has been on the rise across the country. Many Canadians have benefited from the appreciation of the Loonie vs the USD.

Michelle,

We'll do that.

Bill,

I think it's unlikely that the original investor will sell individual lots, but it could happen.

Dawn,

The saying for commercial real estate is that "retail follows rooftops." This bears watching. Thanks for a thoughtful comment.

Bill,

Exactly right!

Jan,

It's a lot of money to walk from.

Richard,

Thanks for your input. An article by Peter Van Allen of the Philadelphia Business Journal explains the concept as follows:

"The concept of lifestyle shopping centers is becoming more widespread nationwide. Most include the high-end retailers of regional malls (like the Court at King of Prussia or Cherry Hill Mall), but in more of an outdoor, storefront setting. Rather than massive parking lots, customers drive right up to nearby parking -- allowing time-rushed suburbanites the freedom to rush in and out of a store.

Shoppers spend an average of 57 minutes at a lifestyle center, compared to 78 minutes at a more traditional enclosed mall, according to 2002 research by the International Council of Shopping Centers. Despite their shorter stay, lifestyle shoppers spend an average of $84 an hour, vs. $57.70 at malls, ICSC reported. "

Matt,

No one knows for sure. The developer hasn't commented publicly, to my knowledge. Stay tuned. Video at eleven.

Latonia,

Things didn't work out. They've already lost the $70 million.

Judy,

We'll keep you up to date as we find out more.

Donna,

When things do turn around, they'll likely do so in a hurry. I'm doing many more loans now (purchases) than I was last quarter.

Gary,

Thanks for commenting. Where is your business coming from in Phoenix right now?

Mike in Tucson

Mike - Sign of the times, isn't it? Good post!

FEB

2008

I am seeing here also I recently listed two homes a for a small builder they are going back to the private investor on the 15th of the month. I doen't sound like a big deal but he was building 12 to 15 homes per year and now faces bankruptcy because of the 3 specs he had when the market softened 2 years ago.

Interesting, Mike, but I would cite my source as a CYA measure. Just a suggestion. It sounds like someone might pick up a good deal. I do have knowledge of someone looking for major real estate purchases (nearly 100 m) for a 1031 exchange, so contact me offline if you have any info I could pass on.

Hi Mike,

With your help and example, I have reached 10,000 points and am now #1 in Benson, Arizona. My Dentist seems to be more friendly and the people I see on the street slap me high five as I pass by (total and complete strangers). Active Rain has poured out a blessing of great will and the possibilities of retiring to Fiji to become a Paranha trainer in 2026.

Keep Well and Sell, Sell, Sell.

John Hurbon

Benson Arizona - Tierra Antigua Realty google me at Benson Horse Property

FEB

2008

Wow! Big hit for some stockholders. Nothing like that happening here because we're just not on that scale. Though construction is way down in Flagstaff.

FEB

2008

One company's rutted-out, pothole-filled journey becomes another's thrill ride! Hopefully the ownership will be able to get this project in gear--I wonder what will happen if the I-10 interchange situation delays the mall construction and starts a whole "snowball effect" going?

Oh see just when I was about to say..."oh we don't have any lifestyle shopping malls" after hearing the description, I was wrong. Hearing your comments about that article makes even more sense as to why they are building them that way. Of course it rains everyday in the summer here so that made me question why they didn't do covered walkways. Interesting article keep us up to speed about this deal...It will be curious how it all plays out! :)