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The Dealmaker: 12/21/2017

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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




Private equity firm acquires 146 acres in Phoenix West Valley. (Disclosure: Rose Law Group represents Quyp Development.) “Virtua Partners… has acquired two properties totaling 146 acres located… on [and adjacent to] Sarival Avenue and W. Harrison Street in Goodyear.” Deal and development details, including the role Quyp played in a property rezone, plus a crystal-clear, drone’s eye shot of the two properties, in Builder.

MATTAMY SHRUGS – Regulatory overkill is driving biggest Canada home builder south. (Disclosure: Rose Law Group represents Mattamy Homes.) Bloomberg reports that a “push to curb urban sprawl has pinched supply and helped send Toronto-area land prices soaring.” As a result, Mattamy has headed south and now “expects to generate more than half its business from the U.S. in the next five years…” More about what Builder calls a “mix of utopian idealism and bureaucratic buffoonery,” here:

Rising rent leads many to buy homes instead. <– “And because of that, the resale and homebuilding market is benefitting significantly.” Fulton Homes is one such homebuilder that has “experienced an uptick in sales this year.” See why Doug Fulton “expects the trend to continue” at AZRE.

Most states saw permits growth over October YTD. The “total number of permits, which included single-family and multi-family, issued nationwide” is running “6.8% ahead of its level over the first ten months of 2016.” Arizona is among the states with the highest number of total permits issued. View the data in Eye On Housing.

Existing-home sales gains strongest in decade. “For the third consecutive month, existing-home sales were on the rise, with all major regions of the country except the West posting a ‘significant hike in sales activity’ last month, the National Association of REALTORS® reported Wednesday.” REALTORMag breaks down the numbers:

Builders could see another year of double-digit growth, analysts believe.“[N]ew homes in all stages of construction sold at the strongest pace in a decade last month. It’s that demand — stoked by years of lean supply — that drives much of the outlook for home builder stocks in 2018.” MarketWatch reports, however, that “builders just don’t have the capacity to increase production as much as they have in previous recoveries.” But “many analysts believe” that might not be such bad thing.

Housing market trends: 2017 year in review, 2018 outlook. “[T]he Apartment List Rentonomics team has analyzed the most important trends of 2017 and determined their potential impact on housing in 2018” — and  Multifamily Executive has the findings here:

What buyers will give up for walkability. “Living in areas that are close to shops and restaurants is becoming increasingly attractive for both young and older generations, according to the 2017 National Community and Transportation Preference Survey conducted by American Strategies and Meyers Research on behalf of the National Association of REALTORS®,” the findings from which are featured in this REALTORMag report. (NOTE: Our crack research staff has just determined that the aforementioned source citation qualifies as the longest ever in Dealmaker history.)

Construction lag partially responsible for Arizona being ‘dead ‘last’ in Great Recession recovery. “But the highs of the ‘unsustainable’ construction industry before the recession were partly to blame for the depths and length of the recession in the state, [experts] say, so not going back there may not be as bad as it sounds.” Cronkite News.

Scottsdale dips into sober home regulations through new spacing requirements. “Phoenix, Gilbert, Paradise Valley and now Scottsdale have adopted certain provisions… to limit… sober home activities within local neighborhoods… But some in Scottsdale say new zoning codes adopted don’t go far enough [one resident goes so far as to call them “a farce”] — while others say new rules adopted in various municipalities could be a violation of Fair Housing laws.” Scottsdale Independent.

Scottsdale City Council approves legal protest text amendment; ‘wise’  decision, says Thomas Galvin, land-use, regulatory and water attorney at Rose Law Group. “Proposed changes to the legal protest rules and regulations within the zoning ordinance… increase the difficulty of property owners adjacent to a rezoning application to meet the criteria to file a valid legal protest of a proposed rezoning application.” — Scottsdale Independent. Thomas Galvin: “Scottsdale’s updating of its zoning code is a reminder that the state legislature passed significant zoning reforms in 2017… Scottsdale was wise to cut off the potential for confusion by being proactive and aligning its legal protest requirements with the state statutes.” Read Tom Galvin’s entire comment in Rose Law Group Reporter.

Reverse mortgage ban hurting some Sun City residents. “Reverse mortgages are continuing to be being denied to applicants in the Sun Cities because RCSC’s $3,500 preservation and improvement fee, charged for any property change of hands, and RCSCW’s $3,500 asset preservation fee violates FHA’s free assumability clause allowing the agency to foreclose on a property without restrictions. But a group of residents and real estate professionals are working to,” shall we say, “reverse” all that? YourValley.

Does the West Valley have what it takes to bring Amazon’s $5 billion second headquarters to Arizona? <– This is the first of a handful of news items from “Land ‘Zo,” PHOENIX magazine’s “new page on housing, development and conservation news from around the Valley and beyond.”

The 24 deals and trends that defined (commercial) real estate in 2017.“[W]hile it was a year that saw bottom lines thrive and construction cranes ever increasingly dot skylines across the globe, it was also a time of change and uncertainty… But despite the unease, the industry stood strong under two words: cautious optimism. These are 24 of the biggest deals and trends that shaped real estate in 2017” (according to Bisnow). –>

?TALKIN’ ABOUT SHAFT (THEN WE CAN DIG IT)? – Money, jobs promised for Superior mine. (Disclosure: Rose Law Group represents Resolution Copper.) “The Resolution Copper Project… will get nearly twice the funding in 2018, allowing the company to ramp up work on a second shaft that will be more than a mile deep.” Although the mine is “still a decade away from production,” AZCentral reports that several hundred are already on the job working on the project, which could eventually employ thousands and “contribute $46.4 billion to Arizona’s economy over the same [10-year] period.”

Census: Arizona crosses 7 million mark for residents for first time.“Arizona added more than 107,600 net new residents over the past year, topping the 7 million population mark for the first time…” (And even though it may seem like it, not all 7 million are gathered every morning on the I-10 out of the East Valley.) More on the census at AZCentral.

Surprise City Councilman Jim Hayden dies after brain-cancer diagnosis in October. AZCentral reports that “Surprise City Councilman Jim Hayden died Wednesday after being diagnosed with glioblastoma on Oct. 30.” Mayor Sharon Wolcott calls Jim Hayden a ‘gentle soul and humble public servant,” and retired Glendale Fire Chief Mark Burdick remembers him as “a firefighter’s firefighter.” Our thoughts and prayers go out to Jim Hayden’s family and all those who knew and worked with him.

Cameron’s $5M + deals of the day –

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

[IN-DEPTH] The quiet revolution happening in the suburbs. “Suburbs first gained popularity for being everything a big city wasn’t. Now they want to be just like downtown.” Governing.

Little room left in race for Franks’ seat. “Debbie Lesko [as expected] is formally entering the race for the vacant West Valley congressional seat and plans to eventually resign from the state Senate to run in the Republican primary.” And the “conservative causes” the soon-to-be ex-pro tempore of the Senate plans to push for? At AZCentral.

Goldwater Institute goes after Denver’s new campaign finance rules. “The lawsuit, filed [Wednesday] on behalf of two [conservative taxpayer advocacy groups’], says changes approved by the [Denver] City Council in September violate the free speech provision of the First Amendment.” I.e., the changes “will violate the privacy rights” of donors by requiring the disclosure of names and addresses. The Denver Post.

Investigation: How Arizona K-12 school districts address capital needs: Part 2Yesterday, Dealmaker featured a capsule summary and link to Part 1 of this investigation from Arizona Center for Investigative Reporting. Part 2 looks into reports showing “a majority of bond campaign funding comes from K-12 vendors.”

Americans are dying sooner. “The Centers for Disease Control and Prevention put out its latest life expectancy and death rate numbers this morning, and [as the blunt headline above makes quite plain] the figures are pretty grim.” Axios.

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