Newland Pays $51M for Land to Expand Master-Planned Development in Arizona
- May 20, 2008
Three years after making what was described as the largest residential land deal in Arizona at the time, Newland Communities has bought another 3,000 acres at Estrella in Goodyear, Ariz., for $51 million, or about $17,000 per acre. The San Diego-based developer said today the acquisition was part of its long-term plans to continue expanding the master-planned community of Estrella, located 17 miles outside Phoenix, over the next 25 years. Newland now owns about 12,500 acres in Estrella, which has about 5,000 acres already developed. “For the long-term, the Phoenix market is forecasted to continue with strong population and job growth,” Robert McLeod, Newland chairman & CEO, said in a news release today. “Our confidence and commitment to residential and commercial development in Phoenix is demonstrated by this acquisition.” In May, 2005, Newland bought 3,750 acres of the 20,000-acre master-planned community known as Estrella Mountain Ranch from Sun MP. The purchase price of the initial acquisition was not released at the time, but a May 16, 2005, article in the Phoenix Business Journal noted that a payment of about $250 million was listed in records filed with the Maricopa County Recorder’s office. The story, written by Mike Padgett, cited several Arizona real estate experts noting that it was believed to be the highest-value land transaction to that date in the state’s history. At that time, only 2,150 acres had been developed, including about 3,100 single-family homes. In 2006, Newland purchased another 2,700 acres and in May 2007, the company acquired an additional 2,800 acres. “Development of the recently purchased land will support our efforts to expand community services and our future plans for the expansion of the Estrella community,” Steve Pritulsky, senior vice president of Newland’s Phoenix Division, stated today. Alluding to the problems in the Phoenix area caused by the subprime housing mess and subsequent credit crunch, Greg Bielli, president of the firm’s western region, noted, “We are looking longer term, way beyond today’s current market correction.” With a build-out plan of about 25 years, Estrella is expected to have approximately 50,000 homes in Estrella and about 1,600 acres of commercial space developed. Estrella, located in the Sierra Estrella Mountains in the Sonoran Desert Valley, has a Jack Nicklaus-designed golf course, and more than 500 acres of parks and open space. The area has seen enormous growth in recent years. Commercial development, particularly retail, has been exploding as companies seek to fill the shopping needs of all the new residents. Last week, CPN reported that Macy’s Inc. was planning to open three new stores in the Phoenix market with the next two years, including a 120,000-square-foot store in Estrella Falls in Goodyear.