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Desert Communities, Inc (affiliated with Vegas based Rhodes Homes) just laid down the winning auction bid for a big hunk of state trust land. $58.6 million for 1,010 acres (which comes out to just over $58K/acre).
While that is indeed a large parcel, what is truly staggering is that it’s located between Apache Junction and Florence, AZ in the “Southeast Valley” — and it’s part of a 275 square mile swath of state land that is ripe for development.
Let’s whip out the trusty HP 12c calculator (the BEST calculator, BTW) and do a little number crunching…
275 square miles… let’s see… 1 square mile = 640 acres (I recall some things from real estate school). 275 * 640 = 176,000 acres. At a price of $58K/acre, that 275 square miles could be worth $10,208,000,000. That’s a fairly significant chunk of change.
What’s more staggering than that? According to the article in today’s Arizona Republic, at build-out this area is expected to be home to one million people. That will double the size of the Southeast Valley.
The State Land Department predicts that we’ll see homes popping up from yesterday’s sale within the next three years. If you’ve ever driven between AJ and Florence, you know there isn’t a whole lot of infrastructure there. Yet. There are some gorgeous views of the Superstition Mountians however, and this particular parcel is located just south of US 60, giving Apache Junction some growing room — important because it’s kind of jammed in between Mesa, the Superstitions and a national forest. If AJ’s going to grow, it’s got to go this direction. And apparently it will be.
Ten billion dollars worth of land, one million people. Those are not insignificant numbers folks. At 3.2 people per household, that’s over 300,000 homes. Someone’s gotta sell those homes. Damn, that’ll buy a lot of Ramen noodles (wink to Greg; he understands).
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[tags]Arizona State Land, HP 12c, Apache Junction, Florence, Southeast Valley, evil developers, ramen noodles[/tags]
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But Jay, how could this developer possibly do this, when it’s as obvious as the nose on your face prices are about to crash?
I guess they’ll just have to learn the hard way.
I won’t drive to Wickenburg. I won’t drive to Apache Junction (that could change). I’ve worked in Queen Creek (never again!). I know I have a future in Buckeye. But everywhere I go in this Valley, constuction is ongoing. Rhodes is building 100,000 houses in Mohave County — not counting all the work they’re doing in Nevada. The short-term will be what it is. The long-term is growth.