The Dealmaker: 12/8/2017

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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

 

 

 

 

LIVE! – FROM TODAY’S PINAL PARTNERSHIP BREAKFAST & ECONOMIC FORECAST:  

Union Park at Norterra master-planned community is underway. (Disclosure: Rose Law Group represents Sunbelt Holdings in other projects.) First-phase construction has started on the “400-acre mixed usecommunity located at the [N.W] corner of 19th Avenue and Happy Valley Road…” Sunbelt Holdings President/CEO John Graham: “Our vision is to make north Phoenix the place to be for authentic experiences in lifestyle and living and Union Park at Norterra… will do just that.” First-phase homebuilders are: Ashton Woods, Cachet Homes and David Weekley Homes. Get further details on the USAA/Sunbelt Holdings community at AZRE. http://bit.ly/2B1jrDb

Most expensive home sales in Phoenix. Arizona Foothills Magazine has the “Valley’s top home sales from the past week (11.27.17 – 12.3.17),” during which combined sales totaled “over $24 million,” a SURGE of $35 million from the previous week!!! Kidding. The JUMP was only $8 million from the previous week’s total of $16 million. (BTW, that’s one way of knowing that you’re able to afford homes like these — if you often find yourself asking dismissively, “Only $8 million?”) http://bit.ly/2AHbAu2

The Wall Street Journal ‘House of the Day’: A Sedona retreat with views—and page views. “[The homeowner] looked at 65 homes in Sedona before finding this one. ‘There was something about the location, the views, the serenity of the surrounding scenery.’ ” (NOTE: The WSJ is earning high praise in the comment section for its Sedona selection — for “spotlighting a tasteful home… with fantastic views… that costs less than a million.”) See it, in a 13-image slideshow.–> http://bit.ly/2B1mU4B

FLIP-FLOP – The profits made from flipping homes continues to shrink.Here are the flipping bullet points: • Single-family homes and condos flipped in the third quarter of this year brought an average gross profit of $66,448 per flip • Home flipping profits continue to be squeezed by a dwindling inventory • Despite lower returns, home flipping is still a popular business • Arizona is among states with highest flipping rates • CNBC has the full flipping report. http://bit.ly/2Bn6YKC

Buoyed by healthy economy, most contractors upbeat. “Despite rising construction labor and materials costs, 55 percent of [commercial and industrial] contractors expect their profit margins to expand in the first half of 2018.” More on the ABC survey and the “ongoing optimism” at AZRE. http://bit.ly/2BNLYZF

Self-driving cars will transform the world as we know it—including where we live. “[A] lot of land currently allotted to cars in urban centers… could be repurposed into apartment and condo towers, bringing down the cost of housing…. [F]arther-out exurbs and rural areas with more affordable, spacious properties could become more attractive to urban workers with the promise of a friction-free commute.” But as realtor.com® senior editor Clare Trapasso notes, “Americans love their cars… So the path to full autonomous tech acceptance may have a few potholes ahead.” http://bit.ly/2A5yloe

LUMBER NUMBERS – Impact of the Canadian lumber duties on the U.S. economy in 2018. “On November 2, 2017, the Commerce Department announced its final decision to impose duties averaging 20.83 percent on Canadian softwood lumber shipments into the U.S.” Eye On Housing has NAHB estimates for the “net loss,” “bottom line impact” of these duties on the U.S. economy, including a “reduced volume of new residential construction.” http://bit.ly/2AIKbrp

Cutting principal didn’t help struggling home owners—but here’s what did. “Principal reduction was expensive — and not very useful.” What about affordability guidelines? Realtor.com® reports that those “also weren’t helpful.” How about larger payment reductions?  Ah, now we’re getting somewhere!  For details on JPMorgan Chase & Co. Institute’s fending-off-foreclosure findings, tap it: http://bit.ly/2BVfYng

NOT KEEPING PACE – FHA to stop insuring mortgages with PACE loans.“On Thursday, HUD announced that the Trump administration is reversing the Obama administration’s decision to insure FHA mortgages with [Property Assessed Clean Energy] liens… Through the PACE program, homeowners can obtain financing to make improvements to their homes to increase the home’s energy efficiency… In 30 days, the FHA will stop insuring mortgages on homes that also carry PACE liens.” HousingWire. http://bit.ly/2BWnez8

Diamondbacks, Maricopa County hold secret Chase Field talks. <– “[O]ver the team’s request to move out of Chase Field, leaving taxpayers without an immediate window into talks that could affect as much as $187 million in stadium repairs. A Maricopa County Superior Court judge ordered the parties last month to take their bitter fight out of the public eye and into private mediation. The first public glimpse of their progress will be a status report to the court Jan. 15.” AZCentral (Dealmaker IDEA: This thing is dragging on so long, maybe the judge should order the D-Backs and the county to suit up nine officials each, and have them settle their who’s-picking-up-the-repair-tab? differences in a 9-inning slugfest at Chase Field. And invite the public to watch! Loser pays all!) http://bit.ly/2AHgwNr

Downtown merchant, stakeholder meeting draws healthy crowd in Glendale. [The] Chamber of Commerce and new Downtown Development Manager Katy Engels held their first downtown merchant and stakeholder meeting… with more than 50 local businesses owners questioning what the direction for downtown is going to be.” One of the chief issues raised: “[V]acant buildings in the downtown area that have been boarded up and no maintenance has been taken on them, with business owners asking the city to purchase the parcels in question.” The Glendale Star. http://bit.ly/2BNNk6H

ON THE ROAD AGAIN – ADOT moves closer to recommended Interstate 11 route. Yesterday, Dealmaker brought news about potential routes for a new freeway in Pinal County. Today, we head further south, into Pima County, with this detailed ADI report on possible I-11 routes and their potential impacts on the region — environmentally and otherwise. http://bit.ly/2nJCah9 

What happened to the American boomtown? “[S]omething is fundamentally amiss,” states this The New York Times piece. Citing such “lower-wage metros” as “Las Vegas, Phoenix and Charlotte” — cities that people are migrating to in droves — the report explores why “places that are booming in size” are no longer the “regions with the greatest prosperity and highest productivity.” (NOTE: This report is also available as subscriber content in today’s Phoenix Business Journal.) http://bit.ly/2j896hP 



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

Arizona’s Trent Franks expected to resign [UPDATE]. (Dealmaker “Coincidence of the Week”: This news comes on the heels of another member of Congress who yesterday announced his resignation and whose last name also begins with the letters F-r-a-n-k.) The Hill reports that “one Arizona Republican said there had been rumors of inappropriate behavior.” (Tap through for two more reports on the resignation: “Franks full statement” in the Washington Times, and “Names float for possible Franks’ replacement” at KTAR; plus get access to this RELATED item from Arizona Daily Star: “Rep. Raúl Grijalva discusses hostile-workplace claim, missed votes.”) http://bit.ly/2BO44uw

GOP tax bill could take the wind out of renewable energy growth. “[A] series of provisions [would] scale back incentives for wind and solar power while bolstering older energy sources like oil and gas production. The possibility highlights the degree to which the… recent surge in renewable electricity generation is still sustained by favorable tax treatment.” The New York Times goes on to report that “Whether lawmakers choose to protect or jettison various renewable tax breaks could have major ramifications… including the prices consumers pay for electricity.” http://bit.ly/2A59VLn

University of Arizona’s emails about global warming conspiracy must see the light of day, judge rules. “The University of Arizona has been ordered to surrender emails by two UA scientists that [the Energy & Environment Legal Institute] claims will help prove that theories about human-caused climate change are false and part of a conspiracy…. [E & E president Craig Richardson] said that getting all the emails… will reveal ‘how climate scientists on the other side of this have been shut out.” A Howard Fischer/Capitol Media Services report in Arizona Daily Star. http://bit.ly/2kINd9q

[OPINION] Utility regulator should not undercut Arizona’s energy efficiency leadership. “The ACC should understand that strong utility policies support energy efficiency jobs, including for my coworkers at Dynamic Systems, Inc.” So writes Darrell Fox, VP of Dynamic Systems, in an Arizona Capitol Times piece which urges the Arizona Corporation Commission to “reject plans that cut utility funding for energy efficiency programs, so that we can seize the opportunity to scale up our efficiency industry.” http://bit.ly/2nHbehX

Legislature favored in turf battle with board that oversees universities. “Attorney General Mark Brnovich issued a legal opinion December 7 saying that, with only narrow exceptions, the Legislature has ‘unrestricted’’ authority to redefine the powers and duties of the Arizona Board of Regents.” Those powers would include setting the cost of tuition, which Brnovich claims “have gone up from 315 percent to 370 percent since the 2002 school year.” Another report by Howard “News Machine” Fischer, this time at Arizona Capitol Times. http://bit.ly/2iEm7M4

Don’t stop the presses. When local news struggles, democracy withers.Wired reports that “within five years very few local papers will have the resources to publish daily. Today nearly all new digital ad revenue goes to Google and Facebook, leaving only crumbs for the rest of the publishing industry.” But the election of Donald Trump “has the potential to disrupt this trend yet again.” http://bit.ly/2A36bdp

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