Multiple Retail Developers Eye Northwest Tucson – Kimco sells Marana Spectrum Site for $23.9Million

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A group formed by former Westcor Development executives, (Michael Treadwell, Edward Ortman, David Scholl, Walter Crutchfield and Robert Williams) Vintage Partners, LLC of Phoenix purchased 161 acres at Interstate 10 near the Twin Peaks interchange and the newly routed Linda Vista Boulevard in the Town of Marana for[mepr-show rules=”58038″]$23.9 million ($148,447 per acre).

The site is where Kimco with Barclay Group had planned a joint venture, a ‘lifestyle’ center that was to add up to 1.3 million-square-feet of retail space to the area, known as “Marana Spectrum”; a project that started in 2006, just before the market decline and putting the retail development on hold. Since Kimco’s last investor day, it’s sold 139 centers, and another 91 are in the pipeline. Some of that is the result of exiting joint ventures, and focusing on the top Metropolitan Statistical Areas (MSAs) in the country.

The result for Kimco should be a national, more concentrated portfolio in the top markets – and opportunities for smaller investors to get into the business or beef up their own portfolios such as Vintage Partners.

Meanwhile, two miles up the road, at the very next northerly interchange of Avra Valley Road and I-10, Pima County Supervisors approved this week a proposed “100-plus store outlet center” according to Pima County. The owner of the property, I-10 Avra Valley Mining and Development, LLC ( R Scott Lewis, managing member) is expected to sell the property to a private company, AWE Talisman, a shopping center developer based in Florida (founded 1980) that owns Fashion Outlet centers in Las Vegas, Santa Fe, Chicago and Canada.

Vintage Partners was unavailable to answer questions on their intent to keep the Kimco  specific plan in Marana. However, just for comparison, the development agreement in 2007 with the Town of Marana was to provide reimbursement for construction at 45% of sales tax revenue to the developers for 15 years. The town would then take the other 55%. This was to allow the developer reimbursement for the infrastructure it was to build such as sewer, water and roadways to the center.

According to Pima County in its approval of the AWE’s Development Concept Permit and amendment for the outlet center, the AWE would be required to pay the County 2% of “certain revenues” generated by its development over 30 years for costs associated with improving the wildlife corridor. The County would share in the “enhancement revenue, projected of $123 million in total with AWE, to compensate AWE for the public improvements it has agreed to build and in exchange for 3.5 acres it is conveying to the County as part of the agreement,” according to the prepared statement by the County. Pima County anticipates $89 million in revenue from the project for the wildlife corridor.

The public improvements would include 30 acres of wildlife habitat, two miles of river park from Avra Valley Road to Twin Peaks Road, and road, water and wastewater improvements that are expected to cost AWE $33.1 million, including borrowing costs over 20 years.

The County claims this is one of the last remaining locations for wildlife to move between the two mountain ranges. The County has been acquiring land in the area to protect the corridor and working with a number of other agencies and organizations to develop a plan for how to improve the corridor over the long term.

It seems fairly evident that two large retail developments would not be appropriate or able to sustain themselves in so close a proximity. The fact that both are going on so close together, almost seems like a competition to see who can move the fastest, Marana or Pima County? The one who can move ground first wins!

The buyer, Vintage Partners as a potential buyer was exempt from the listing with Ed Beeh and Mike Polachek of SRS Real Estate Partners in Phoenix, and were not involved in the transaction that Kimco handled directly. Beeh can be reached at (602) 682-6040 and Polachek is at (602) 682-6080, for more information. Vintage Partners should be reached at (602) 955-9222. To reach AWE call (305) 932-6202.

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[mepr-show rules=”58038″]Sale date: 12/12/2013. All cash transaction. SSR Real Estate Service had the listing with Vintage Partners exempted as a potential buyer. Property was on the market for several years. APNs: 216-23-075A, 004G, 001D, 0020 and 003. Total acres: 161.0218 acres. Traffic count: I-10 56,864 VPD, Twin Peaks 930 VPD.[/mepr-show]