The Dealmaker: 10/27/2017

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The Dealmaker is a daily note of the day’s top real estate stories served just in time for lunch. Bon Appetit! Subscribe here to receive the Dealmaker to your inbox


[OPINION] Our Turn: What part of ‘property rights’ does Phoenix not understand? In their co-authored piece at AZCentral, Rose Law Group litigator Evan Bolick and former U.S. congressman Barry Goldwater Jr. make a forceful case for private property rights in the matter concerning the Chinese Cultural Center. With principle on their side, along with “one of Arizona’s most critical laws” (the “Private Property Rights Protection Act”),  the piece serves as a cogent reminder to any would-be defiers of the act that “architectural preference cannot trump private property rights, no matter how vociferous the objection by objectors…”

Three of four vacant residential properties in U.S. are investment homes; Phoenix rate increases. Phoenix is among the metros where vacant property rates increased from a year ago, according to ATTOM Data Solutions 2017 U.S. Residential Vacant Property and Zombie Foreclosure Report. And where can you access all the scary highlights and get the link to the whole frightening Zombie report? To cop a line from Poltergeist, “They’re heeeeere.” –>

Most expensive home sales in Phoenix. It’s time once again for another edition of “Sales of Homes That Scream ‘You’ll Never Be as Rich as This!’ ” Arizona Foothills Magazine has “the Valley’s top home sales from the past week (10.16.17 – 10.22.17). The combined sales for the top 10 of the past week was over $10 million,” which is DOWN $9 million from the previous week.

Meritage 3Q earnings top expectations. “Closings up 9%, orders up 8%, backlog up 3%.” Well, what were folks expecting? Find out in Builder.

Orders obey. When it comes to “the new Census report show[ing] the highest one-month change in growth in [new] home sales since 1992,” reactions from economists have run the gamut, from “widespread surprise” to “barely blink[ing].” Bulider’sJohn McManus serves up a sampling of these responses, to a “September’s sales surge” that “restores momentum to a market that had previously showed signs of hesitation.”

Zillow: Home values up 6.9% in September. “Home values are 6.9% higher than a year ago, with the median U.S. home now worth $202,700, according to the September Zillow® Real Estate Market Report…” Builder has the breakdown, which includes Zillow’s Home Value and Rent Index figures for Phoenix.

Mortgage interest deduction could take a hit. “The Unified Framework proposed by the White House and congressional leaders last month (the so-called Big 6 tax plan) makes the mortgage deduction irrelevant for all but a small fraction of home owners…” Details in Builder.

Phoenix attracts more than half-billion dollars in foreign investment.“[Making the Phoenix area a] top two U.S. cross-border investment destination in 2016, according to the latest CBRE research. Furthermore, foreign buying remains elevated in the market in 2017 year-to-date.” Research highlights and link to CBRE’s full Global Industrial & Logistics ViewPoint, October 2017 report– in AzBusinessMagazine

Thrillist: This Phoenix neighborhood is about to get ‘crazy popular.’ “The lifestyle website included the Warehouse District… as one of ’12 up and coming Neighborhoods across America that are about to get crazy popular.’ ” And the reason for the soon-to-be-all-the-rage ranking? HINT: It has everything to do with “something the Phoenix Business Journal has been covering for a while…”

A river in the desert: ASU helps McCain with Rio Salado effort. In a PBJfollow-up to a story we brought to you a few weeks back concerning Sen. John McCain’s idea “for a potential large-scale infrastructure project to bring water to the usually drive [sic] Salt River riverbed,” ASU sustainability scientist Duke Reiter discusses the university’s efforts to “get the river rolling.”

South Mountain Freeway bridge takes shape over I-10 in Phoenix. “Drivers using Interstate 10 in west Phoenix now can see the first girders that were placed about six stories above the freeway at 59th Avenue…” But you don’t need to drive out there to see it. AZCentral has some cool shots and videos of the progress, as well as a 52-image slideshow of the “Phoenix-area freeway history.” Check ’em out!

Candidates announce quickly for Mayor of The Town of Fountain Hills. “With the announcement by Mayor Linda Kavanagh that she will not be running for mayor next year, the news came quickly that there are two candidates prepared to face off in the race”: Councilman Cecil Yates and former Councilwoman Ginny Dickey. More about each candidate in Fountain Hills Times

YELLEN OUT? – Yellen reportedly out of Fed chair competition. “Citing a source close to President Donald Trump, POLITICO reported that Janet Yellen is no longer being considered to retain her role as Federal Reserve chair.” So is it safe to “assume” that it’s now just a “fight” between “Jay Powell, a former investment banker, and John Taylor, a Stanford University economist”? Not quite. Builder has the “here’s why.” 

As a supplement to the Dealmaker, we thought you might enjoy these articles!


Ducey promises not to raid city, county roadway funds next year. “Gov. Doug Ducey has promised to stop taking $30 million in transportation money annually from Arizona cities and counties… The state has dipped into shared transportation money from the Highway User Revenue Fund, or HURF, to pay for the Arizona Department of Public Safety… The promise is a win for local governments still smarting [dare we say “HURFing”?] from revenue declines during the Great Recession.” AZCentral.

Ducey says he wants every Arizona teacher to get a raise amid outcry.“The stir over teacher salaries began anew last week after it was reported that some of [Gov.] Ducey’s employees received raises as high as 20 percent. Advocates have argued that money could have been given instead to educators.” Tap through to read/hear what Gov. Ducey “told KTAR News 92.3 FM’s Arizona’s Morning News.” –>

Arizona wrongly distributed $62 million in federal aid for poor students over 4 years. “The Arizona Department of Education was alerted in March 2015 that it was improperly distributing federal funds intended to help low-income students, but the department didn’t undertake serious efforts to identify and fix the problem until early 2017… Some schools got too much money for the four years, other schools got too little over the four years, and some schools got too much in some years and too little in other years.” And not everyone is happy about the “plans to rectify the situation.” Arizona Center for Investigative Reporting.

Immigrant population in Arizona increases to nearly 1 million in 2016. <– This [figure] put Arizona among the top 15 states in the nation for immigrant growth…” As for the national numbers, “immigrant population increased by 3.8 million from 2010 to 43.7 million in 2016…” And in a news-bite that could have come out of Dealmaker’s Dept. of Obviousness, KTAR reports that “A majority of those immigrants came from Mexico.”

Former Arizona Gov. Jan Brewer not interested in running for Flake’s seat. “I paid my dues and I am not leaving Arizona, I’m staying right here,” Brewer said “[i]n an interview with KTAR News 92.3 FM’s Mac & Gaydos… But there is one person Brewer is cheerleading to enter the race…” Tap through to find out who. And then there’s this –> (Editor’s note: Rep. Trent Franks is not going to run for Flake’s seat, Yellow Sheet Report said Wednesday. The Capitol-based publication also reported the White House ‘is rumored to be seriously looking at Ducey as a potential candidate for Flake’s US Senate seat.’ ” The governor says he’s not interested in running.)

Court: Phoenix wedding invitation designers must serve LGBT customers. “Joanna Duka and Breanna Koski, owners of Brush & Nib Studio and self-described evangelical Christians… filed a lawsuit against Phoenix in May 2016 challenging the part of the city’s nondiscrimination ordinance that prohibits discrimination based on sexual orientation… This week, [Maricopa County Superior Court] Judge Karen Mullins… quashed [their attempt].” Read about it at AZCentral.

Arizona Supreme Court weighs legality of state’s Medicaid expansion. Is an “assessment” that expanded Arizona’s Medicaid program “a tax”? If it is — and that’s what the state’s highest court will decide — it means that it was “illegally enacted.” In Arizona Daily Star, Capitol Media Services’ Howard Fischer brings us up to speed this case in which the “fate of health care for 400,000 Arizonans” and what “voters wanted 25 years ago” with the passage of Prop. 108, both hang in the balance.

STEEP CLIMB – Lawmakers, advocates blast ‘misguided’ Grand Canyon fee hike plan. “The proposal unveiled this week would create a new peak-season entry fee [‘May through September at most parks’] that would at least double fees at the Grand Canyon National Park. The fee at the Grand Canyon would go from “$30 per car to $70…”. Check out reactions to the steep hike in Cronkite News

Phoenix Industrial Market Surging with Activity Read more

Phoenix retail vacancy lowest in eight years; home furnishing store expansions signal housing market Read more

Optima Kierland condominium tower more than 75% sold Read more

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October 2017