Royal Properties is a company with one purpose: to develop, own and manage multi-family student housing near four-year universities throughout the United States. It was founded in 1979 by Michael Henneman and Rodrick Schmidt in Chicago. Its latest project will break ground this month for a 232-bed student housing project in the Iron Horse Neighborhood.

The Junction at Iron Horse LLC, an affiliate of Royal Properties, was formed to develop a 2.43 acre site at 504 E 9th Street in Tucson, located at 3rd Avenue and 9th Street, 0.6 miles from the University of Arizona in Tucson. The Junction at Iron Horse is an off-campus transit-oriented development located within 850 feet of a Sun Tran bus stop on Toole Avenue and 400 feet from the Tucson Modern Street Car stop at 4th Avenue and 9th Street. It is also located within 800 feet from two new public parking structures near 4th Avenue and Toole Avenue, with pedestrian and bike routes prevalent in the area and a Walk Score of 90, the highest in the Tucson area.

A global firm, The John Buck Company (JBC) of Chicago joined the venture recently to handle the management oversight of the project. With more than three decades of experience, JBC has a strong track record of innovation in the field.

JBC is a recognized leader in sustainability efforts and a member of the U.S. Green Building Council. The company has completed projects totaling more than 40 million square feet that represents more than $10 billion in financing.

Working with JBC is Grenier Engineering of Tucson (John Grenier, managing member) and Architects, GDA Southwest of Tucson (John Price). Adolfson & Peterson Construction of Tempe (Ben Lehan, Project Manager) is the general contractor.

Plans filed with the City of Tucson on 3/8/2013 proposed an expansion of the project from 198-beds in 67 units to 297-bedrooms in 97-units. Neighborhood meetings followed with JBC representatives and City reviews and the project was permitted for 232 bedrooms in 76 units, primarily due to parking issues.

According to a supplemental parking demand analysis filed with the City, the parking requirements of 253 parking spaces for the 297-bed student housing project would fall short of City requirements by 118 spaces, even with a surplus of designated bicycle spaces being in surplus, with 179 spaces minimum and 186 proposed. The City’s IPP approval for the original plan stipulated an “unbundled” parking charge of at least $25 per month, per space; providing each resident a “stored value” Sun Tran bus pass; providing bed parking at the rate of 0.625 per bedroom; and the provision of car sharing.”

With the Junction’s design modified by an additional fifth floor and rooms added, the ratio of on-site parking spaces to beds will be 135/232, or 0.79 spaces per bed. The IPP allows 135/76, or 1.77 spaces per unit. With adjacent on-street parking included, the ratio is 183/232, or 0.79 available spaces per bed that is 2.41 ratio with on street parking included.

Curtis Lueck Associates of Tucson, a transportation planning and traffic engineering firm was employed to do detailed research into parking utilization at other student housing projects downtown, their report is significant in understanding how transit and walk access affect parking demand. The firm received permission to videotape the parking areas at The District student housing at 550 N 5th Avenue, to study parking utilization, duration and turnover. Parking data at peak and off-peak times were videotaped to determine by counting the empty spaces and subtracting from the total available. Finally, it videotaped entrances and exits from the parking areas during peak and off-peak times.

The occupancy data showed that the peak utilization of the garage was 76% at peak times and the lowest was 46% at off-peak times. Overall average utilization was about 54% from research performed in February/March 2013. The report notes that The District had the highest parking ratio of all the student housing developments studied.

Roy Drachman of Roy Drachman Realty represented the buyer, The Junction at Iron Horse in the purchase of the property. Peter Douglas and Patrick Welchert of Cushman & Wakefield / Picor Commercial Real Estate Services represented the seller, Crescent Realty Corporation when it sold in June 2012.

The contractor reports that ground breaking will start this month for the 2014 school year opening.

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[ismember]The Junction at Iron Horse LLC paid $1.6 million for the 2.43 acres with buildings to be razed in June 2012. HRB Tucson, LLC a joint venture of John Buck Company and Royal Properties acquired the property for $2,045,202 in May 2013 is a non-arms length transaction. Zoning is C-3 & R-3 for the property.[/ismember]

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Since third quarter 2012, investors nationally have continued to exhibit a strong appetite for multifamily properties, a fact borne out by the sales in Pima County for the first half 2013. From duplexes to larger $26 million complexes, it seems that investors are preferring Class-B and -C multifamily properties over other commercial real estate here, and with cap rates ranging from 6% – 8%, what’s not to like? These are the final two multifamily sales closing in Q2, links to other significant apartment sales that occurred in Q2 can be found at the bottom of this article

Country Club Court at 2152 – 2156 N Country Club Road in Central Tucson sold for

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$815,000 ($32,600 per unit). The 25 units were all two-bedrooms / one-bath in six buildings totaling 18,312 sq. ft. (built 1958) of masonry construction on a 1.7 acre lot in the Palo Verde Neighborhood. Amenities included A/C, fenced yards, covered parking, coin operated laundry, a large courtyard and swimming pool. Units were individually metered for utilities. Property has a walk score of 78 and a bike score of 86.

The seller, 2175 Country Club Ave, LLC of Tucson (Rex Verne Casey, managing member) financed with a seller carry back and 20% down.

Lance Parsons of Re/Max Catalina Foothills Realty in Tucson represented the seller. Billy Mordka of Harvey Mordka Realty represented the investor.

In another unrelated transaction. A 15-unit special use multifamily facility at 3701-3709 E 3rd Street in Central Tucson sold in a double escrow. In prior document, Pinnacle Realty Investors, LLC of Tucson (Jarrett Reidhead, Manager) purchased the property for $300,000 ($20,000 per unit) from Tucson Centers for Women & Children, run by the Gospel Rescue Mission of Tucson. In a subsequent transaction the following day, the property was sold to Rio Verde Ventures, Inc. of Tucson (Jeffrey Katz, Manager) for $350,000 ($23,333 per unit).

The property consists of eight buildings totaling 10,198 sq. ft. (built effectively in 1958) on .87 acres. It had seven casitas and a 5,268 sq. ft. motel style building with a shared kitchen designed for the

seller that occupied it as a non-profit for temporary accommodations for women and children in need.

The property was vacant when it sold and will be renovated by the local investor for lease and / or resale.

Both Reidhead and Katz are real estate brokers and represented themselves in the transaction.

Parsons should be contacted at (520) 749-6000. Mordka can be contacted at (520) 298-8500.  Reidhead can be reached at (520) 331-8050. Katz can be contacted at (520) 745-4646.

Additional multifamily sales for 2Q:

Mission Palms sells for $25.65 Million

Buying Copper View Video Documented

Vista Catalina Apartments Sell For Repositioning

Smaller Multifamily in Central Submarket for Quarter

Smaller Multifamily in Other Submarkets

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[ismember] 2152 N Country Club was on the market approximately 4 months, at a list price of $875,000 and a 30-day close. The property was reported selling at about an 8% cap rate and with 2 vacancies at time of sale.
First transaction at 3701-3709 E 3rd St. dated 6/11/2013 recorded in document #20131620473 sold for $300,000. The subsequent document dated 6/12/2013 recorded in document #20131630404 and sold for $350,000.[/ismember]

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Zano Auto Sales through its affiliate, 3C Investments, LLC of Sahuarita (Edward Campuzano,  principal) bought the property at 2009 S Alvernon Way for[mepr-show rules=”58038″]$145,000 ($60 PSF) for the 2,411 sq. ft. building (built 1976) on a 10,170 sq. ft. lot. The property was formerly leased to Golf Cars of Arizona until the fall of 2012 when it closed the location to replaced it with a new facility at 4888 E 22nd Street in Tucson.

The story on Golf Cars of Arizona’s expansion move was reported on April 9, 2013, click here for full story  https://realestatedaily-news.com/?s=Golf+cars

Zanos Auto Sales has occupied 2005 S Alvernon Way, at the hard corner of 29th Street and Alvernon Way, since December, 2005 when it was purchased by Edward Campuzano. With this new acquisition, he has assembled just under one acre at this prime southeast corner. The two buildings have  been freshly painted to match and the new building has a grade level door and additional office space being used by the sales staff.

There were no brokers involved in the sale. The seller was The Wilfred & Avis Whetten Trust of Phoenix.

[/mepr-show]Campuzano can be reached at (520) 277-3133 or at www.ZanoCars.com

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[ismember] On 12/13/2005, the buyer paid $500,000 ($246 PSF) for the 2,30 SF  building (built 1969) on 30,598 SF (.70 acre) at 2005 S Alvernon. On 4/30/2013 this second building was purchased on an additional 10,170 SF lot. Combined the property has 4,411 SF improvements on .94 acres at the southeast corner of 29th St & Alvernon.[/ismember]