As revitalization of Downtown Tucson continues, we are beginning to see some revitalization spill over into a Tucson midtown area that involves an exciting luxury infill project. Potter Place LLC, a group of local investors formed by Miramonte Homes of Tucson, recently purchased 3 acres from the Arizona Inn Company for $1.35 million ($10.33 PSF) for an infill project of luxury homes in midtown Tucson.

Walkability when a reality and not just a euphemism for having Starbucks on the corner, is indeed a valuable commodity. It means that people can live in a location within the inner city that gains in value from its real-life proximity, time- and aggravation-saving through its nearness to things, people and urban attractions that draw people to them. All the reasons Downtown Tucson was revitalized in the first place and what we have all been waiting to see for so long.

The Potter Place infill project promises to be just that kind of walkable upscale, luxury development. Located across from the historic Arizona Inn, one of the most beautiful properties in Tucson, within walking distance to UMC and the modern streetcar with all that Downtown Tucson has to offer, this project would never have been conceived of prior to a few years ago.

The developer purchased the property for land value and plans to demolish the dilapidated (circa 1930) buildings that were left vacant for 25 years. Once removed, 11 detached semi-custom SFRs are to be constructed on the site. Final design for the project is still under development and pending plat approval, but so far we know that it is like nothing Miramonte has done before. Great effort is being taken to keep the property’s mature landscaping that makes it invisible to the street behind an Oleander wall. Each home will be single story and range in size from 2,600- to 3,000-square-feet on 8,000-square-foot lots. Keeping with the Mission Revival Style associated to the historic Arizona Inn, the project promises high end luxury. Home prices are to range from $800,000 to $1 million, depending on amenities; this is not your typical Tucson neighborhood.

But developers believe the time is right for such an upscale urban neighborhood in Tucson. We spoke with one of the partners, Bob Gugino, who said, “We’re excited about this project and expect it to set a new standard for infill development in Tucson. There is no other place for people to buy new, high-end semi-custom luxury homes within the City, and many people are interested in urban living near our downtown for many reasons.”

“There is definitely something to be said for being within walking distance to the streetcar and minutes to get downtown, without having to park, to maybe just get an ice cream at The Hub or to  have dinner and a show,” Gugino continued. “Many of us came from cities where we could walk or take public transportation everywhere and would love to experience some of that city-style living here.”

This project is located between Blenman/Elm and Catalina historic neighborhoods, two beautiful upscale, older neighborhoods. The option of buying new construction with the maintenance of an older home is not an unreasonable notion for many.

By building all 11 homes at the same time, and not staggering the construction in stages, the impact to the neighborhood will be minimized. Construction is to start by the end of this year, with a Q4 2016 completion goal.

Jose Ceja of EXA Architects in Tucson is lead architect for this fresh new project,  the first to reach beyond the Rio Nuevo District and Downtown, opening opportunities for a larger city revitalization that brings with it access to the all the amenities we want. Infills don’t get more exciting than this one! We’ll do our best to keep our readers informed of its progress.

For additional information on this sale log in to see RED Comp #2897.

BW RRI IV, LLC, a partnership between a Singapore investor and Westmont Hospitality has won the bidding for a Red Roof Inn portfolio which contains 89 hotels with 10,715 rooms. Their winning bid of about $600 million ($55,996 per room) beat out runner-up Blackstone, which wanted to convert the properties to its Motel 6 brand.

Five Mile and Westmont put the portfolio up for sale this past December via Eastdil Secured. Westmont wanted to stay in the investment, so it teamed up with the unidentified Singapore investor to make an offer on the portfolio.

The sale enables majority partner Five Mile Capital to cash out and Westmont to retain a minority stake and continue to operate the portfolio.

There were two Tucson Red Roof Inns that sold in the transaction, the 118-room hotel at 3704 East Irvington Road (near Tucson International Airport) in Tucson for $2.89 million ($24,450 per room) and the 133-room hotel at 4940 West Ina Road in North Tucson for $2.95 million ($22,208 per room).

Five Mile Capital Partners of Stamford, Conn and Montreal-based Westmont Hospitality Group took over 143 Red Roof hotels in 2011 after the Red Roof chain defaulted on debt. Four years ago, they financed the purchase with a $275 million floating-rate loan from Starwood Property and Fortress Credit, and then plowed $70 million into improvements.

After the partnership sold 20 of the properties, Starwood and Fortress agreed to modify the loan in 2013, increasing its size to $285 million and extending its term by two years, to August 2015, plus three one-year extension options.

The senior $200 million portion of the modified loan, then backed by 123 hotels, was securitized via a stand-alone deal led by Wells Fargo. That loan, whose total balance has paid down to $235.9 million, will be retired in conjunction with this sale.

Barclays will finance the purchase with $450 million of floating-rate debt package that has a two-year term, with three one-year extension options. The bank will divide it into senior and mezzanine portions whose sizes are still being determined. Barclays will securitize the senior portion in a stand-alone deal and place the junior debt with high-yield investors.

Since the 2013 financing, Five Mile and Westmont has sold off an additional 33 hotels, reducing the portfolio to 90 properties and one more hotel remaining for sale.

For additional information log in and refer to RED Comp #2938 and #2932.

The Love Divine Fellowship Church sold its 2,935-square-foot building at 1922 S Farwell Avenue in Tucson for $275,000 ($94 PSF) to Potter’s Christian and Missionary Fellowship.

The church building had been well maintained and comfortably seated up to 100. Within the past few years seller had installed new flooring, new paint inside & out, new restroom fixtures, and chip-sealed the parking lot. The church is located 3 lots south of 29th Street on Farwell Ave and is about halfway between Swan and Craycroft.

The buyer will owner occupy the building and is associated with The Door Church at 2950 E Irvington Rd, Tucson. The seller carried back the loan on the property.

The seller then purchased the former Faith Community church facility at 2901 S Pantano Road in Tucson for $400,000 ($39 PSF) from the Christian Reformed Board of Home Missions in an all cash transaction.

This 10,186-square-foot church is a three building facility on 2.51 acres consisting of a main sanctuary with offices, restrooms, nursery and a separate fellowship hall. There is also a 3,102-square-foot residence in the back of the property and plenty of parking for growth.

John Yarborough with Romano Real Estate in Tucson represented the Love Divine Fellowship in both the sale and the purchase of the new location and both buyer and seller in the 2901 S Pantano Road transaction.

To learn more Yarborough should be reached at 520.577.1000.

Also login to see RED Comp #2815 and #2873 for additional information.