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Will White Discusses North Marana Growth Looking Forward

North Marana growth heats up as the area looks to be a major beneficiary of Tucson’s strong market 

Land deals seem to be non-stop these days in this sub-market of southern Arizona and Real Estate Daily News decided to look deeper into what is driving this. We thought there was no better place to start than the company who has been the “go to” source in this area. Will White and John Carroll of Land Advisors Organization have been involved in a major portion of the activity in north Marana for decades and represent several of the area’s larger projects going forward.  

We recently sat down with White to get his thoughts on all this activity in north Marana and to ask what we can expect going forward. 

Q: Will, the Tucson market has had an amazing ride over the past 18 months. Nowhere is this more true than in north Marana. Can you break down how (and why) this has happened?   

North Marana benefited from a Tucson land market that was short on lot inventory going into 2020 and is extremly short going forward. This area has the most privately held land available that is unconstrained and can be delivered in the Tucson metro area. In addition, the land there is developable and there are entitlements in place and infrastructure at the ready. Difficult to find that right now in other areas of Tucson. As other large projects around the region saw most of their lot inventory purchased in the past 12 months, the homebuilders have turned their sights on this area. Keep in mind also that this area is already home to successful projects like Gladden Farms that will put up the most SFR permits in the market this year. The area was already successful and will look to only get better as we move forward. 

Q: We all have heard how tight the land supply is in Tucson. Is this also the case in Marana? 

The picture is getting clearer on the supply side of things in Tucson. It is historically short on lots and it would take some time to get back to balance. At the current pace, the Tucson metro market needs 19,000-34,000 lots to be built and delivered to builders in the next 5 years. Bottom line, the market is not set up to deliver this many lots in just 5 years. It’s a big challenge. Important to keep in mind that these numbers are based on our historically low permit pace, +/-5,000 permits. Adding pressure is, there is consensus that we have 20% more consumer demand for housing than what can be produced. Due to the land constraints around the region here, we believe the north Marana will begin taking up to 40-50% market share of all of the permits in Tucson metro area. What this means is north Marana needs to be delivering 2,000 lots annually to homebuilders, or10,000 over the next 5 years. The race is on to get these lots produced and they will 100% come at a premium.

Q: How are homebuilders reacting to this dwindling land supply? Are they moving forward or pulling back? 

Homebuilders have done a nice job of securing lots in north Marana to-date. On the land side, we are not currently seeing any pull back in Tucson. Gladden Farms has grown its roster to 6 homebuilders over the past year and has been a “go to” project in Marana. The homebuilders have been selling really well. However, with all of the acquisition activity at Gladden over the past 18 months, new lots are becoming harder to secure. What we are seeing now is a lot of homebuilder strategy revolving around positioning for the future up there. There are 4-5 larger projects in north Marana that will be the main supplier for the homebuilders moving forward. Several builders are working with these owners/developers right now to secure spots in the initial phases of these projects. This becomes important when looking at future pipeline availability in the big projects. As there wont be enough positions to go around in these initial phases, It will definitely be the “haves and have nots” and some builders will be constantly on the search. Definitely better to be proactive than reactive in north Marana.

Q: Tell me what homebuilders find attractive about that submarket 

It’s important to remember that north Marana has been active for decades, but we are definitely seeing it accelerate. What is great about the area is a lot of it is new and it has a great feel to it. The projects are new, the homes are new and the product is getting more innovative, the infrastructure and roads are new, the schools are good, and we will most likely see new employment and commercial services to support all of this residential. The area just looks and feels very good and it has a lot of history to it. Also, the Town of Marana has been very open to work with and, in our experience, has rolled out the red carpet to the area’s homebuilders and developers up there. The process is pretty streamlined in getting things going. Lastly, the homebuilders like to be where they can be successful and north Marana has shown some of the region’s best pricing power and pace. As this continues, they will look for ways to keep building on that success. 

Q: Okay – we get that north Marana is hot. But, in your opinion, are some areas there hotter than others? 

You have two interchange points of access currently into this area, Tangerine Road and Marana Road to the north. The success of Gladden Farms off Tangerine is well documented and now we are seeing projects begin on the eastside of I-10 that will be accessed off of Tangerine. That interchange has been “main and main” for some time. What we definitely have our eyes on next is what is becoming known as the “MRC” or “Marana Road corridor”. This is accessed at Marana Road and I-10 and it is the area that will light up soon with all that is being planned up there in larger master-plan projects, commercial/retail and major infrastructure work, both west and east of I-10. In addition to that, we have seen the homebuilders very active father north up I-10 at Red Rock Village so that gives you and idea of the total spectrum. 

Q: Lastly, look into the Land Advisors’ crystal ball. What does north Marana look like 5 years from now? 

The past 18 months has proven that our crystal ball isn’t as clear as we would like all the time. North Marana has a large amount of land to grow, very good master developers in place, a strong and supportive municipality, proven homebuilding track record, growing employment and commercial uses, and it is on top of its growing infrastructure needs. As we mentioned, in 5 years, we believe this area north of Tangerine will have to accommodate close to 2,000-2500 permits a year. We also think that we will see renewed demand for various commercial and retail services as well as a growing employment base. In 5 years, we think homebuilders in Tucson metro will rely on this area for upwards of half of their pipeline and business. We will see the Tangerine and I-10 area fill out and we will see a large amount focus on the Marana Road corridor (MRC). Demand is far exceeding supply in all areas of Tucson and to get it back in balance will take time. North Marana will be a major player in that solution.

PHOTO: Will White, runs the Tucson office of Land Advisors Organization (LAO) and represents the vast majority of Tucson’s larger master planned communities and residential projects.

 




Saguaro Ranch Energized with Strong Estate Lot Sales Velocity and New Home Construction

Over the past 12 months, 16 Estate Lots of four acres or larger were sold in Saguaro Ranch, the exclusive, 1,200-acre gated community 35 minutes north of downtown.

Tucson, Arizona — On the eve of the official grand opening of the Saguaro Ranch Clubhouse, closings in recent months illustrate the sales velocity Saguaro Ranch is enjoying. Over the summer, construction continued at an impressive pace on multiple custom Estate Lot homes, while blueprints created by Tucson-based architects are being finalized on custom homes for Estate Lots 1, 41 and 97. Plans are being finalized or homes are under construction on Lots 1 and 43 at Moonlight Canyon.

“We had a very busy summer with sales and new home starts,” said Mike Conlin, manager and POA board member of Saguaro Ranch. “We experienced record sales prices on lots and it’s exciting to see crews working on the Estate Lot’s new custom homes. Miramonte Homes is also busy building homes in the new Moonlight Canyon subdivision.”

Saguaro Ranch is currently developing Phase Two at Moonlight Canyon, which is comprised of 22 homesites. Buyers interested in a semi-custom or custom home can select from 2,934- to 3,896-square-foot, single level floor plans designed by Robinette Architects, Inc.

“We believe that having all of the living spaces on one level made sense for today’s buyer, and that the low-profile design fits appropriately with the desert surroundings,” explained Ron Robinette, the architectural firm’s founder, and Tucson native. “We’ve incorporated large windows to introduce ample natural light into the living spaces of the home.”

The residences are distinguished by nine-foot flat and raised ceilings, a Great Room with a fireplace, and a chef-inspired contemporary kitchen with a pantry and top-of-the-line appliances. Covered patio spaces provide welcomed shade, while an optional swimming pool, jetted spa and fire pit can enhance year-round outdoor living.

“Ron’s designs create such an exceptional platform for Miramonte Homes to build these quality-crafted homes at Moonlight Canyon,” commented Scott Lundberg, President, Saguaro Lot Management, Inc. Chris Kemmerly, Principal and CEO of Miramonte Homes and a 1982 graduate of the University of Arizona, brings over 35 years of experience to the Moonlight Canyon enclave, located adjacent to the ‘members-only’ Saguaro​ ​Ranch Club. Lori Carroll, who graduated from the University of Arizona in 1986 with a Bachelor of Science Degree in Interior Design, is working in collaboration with Miramonte Homes and Robinette Architects, Inc. to bring her expertise to the project.

“Working with Ron and Chris over the years has and continues to be a true pleasure,” said Carroll. “Being part of a dynamic team to collaborate on interiors, architecture and construction is critical for the success of any project. Our relationship over the decades is an excellent example of how industry leaders complement each other to create striking residences.”

Included in the purchase price of their Moonlight Canyon home, home buyers receive ten hours of the award-winning designer’s time. She is also available to provide design consultation beyond the ten hours at her normal hourly rate.

The first six homes in Phase One range in price from $1,494,000 to $1,655,900. Homebuyers can choose to add a guest casita ranging in size from approximately 424 to 677 square feet and costing between $219,000 to $259,900. The lots range in size from one to three acres.

“Saguaro Ranch is a one-of-a-kind community unlike anything in the western United States in that only 20 percent of the land is designated for development and 80 percent of it preserved as undisturbed desert,” added Lundberg.

Saguaro Ranch is a prestigious real estate community whose location in the Tortolita Mountains just north of Tucson is as majestic as it is serene. Distinguished by a one-of-a-kind tunnel entrance and National Park like setting, it combines welcomed privacy with an active, outdoor lifestyle and diversity of amenities, including the Saguaro Ranch Club, which features a 25-yard lap pool, bocce ball court, two pickleball courts and a state-of the-art rooftop fitness area.

For information visit Saguaro Ranch online, on Instagram or on YouTube. To learn more, contact Mike Conlin at 520.429.4773 to be put on the guest list to arrange a tour. Brokers  protected.




Key Measures of Labor-Market Slack Tighten

M&M Employment
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Marcus & Millichap is reporting that employers’ acceleration of hiring in October is a key measure of steady economic growth.

  • U.S. employers shook off their third-quarter doldrums in October, hiring the most new workers in any month so far this year. The sizable gain in payrolls also renews discussions about a possible hike by the Federal Reserve in the overnight lending rate before the end of this year. The drop in the unemployment and underemployment rates in October to multi-year lows may convince the central bank that the labor market slack has tightened sufficiently to spur higher wage growth and warrant a move.
  • Fueled almost entirely by growth in private-sector industries, employers created 271,000 positions in October, nearly matching the sum of jobs added in the preceding two months combined. Payroll gains spanned several sectors, and the approaching holiday season figured prominently in last month’s hiring spurt. Retailers added nearly 44,000 workers in October, the most in any month this year. Both Target and Amazon recently announced plans to bring on a significant number of seasonal workers, which should be reflected in additional increases in retail staffing in the weeks ahead. Outside of holiday-related activity, the ongoing enrollment of new workers in employer-sponsored health plans contributed to a gain of approximately 57,000 healthcare jobs last month.
  • Both the unemployment rate and the underemployment rate dipped to eight-year lows last month, reaching 5.0 percent and 9.8 percent, respectively. The declines will likely figure in the Fed’s upcoming monetary policy discussions. The much-scrutinized labor force participation rate, meanwhile, held at 62.4 percent but has decreased this year. The fall in the rate, however, predates the recession and actually commenced at the turn of the century. While the economic downturn accounted for a portion of the decrease, factors including the aging of the population and greater college enrollment also contributed significantly.
  • The U.S. office sector appears poised to break out in the months ahead. Professional and business services employers created 78,000 positions in October and have added workers in nearly every month over the past two years. Gains in office-based businesses including accounting, engineering, architecture and administrative services drove most of the increase and continue to fill unused cubicles and workspaces. This year, U.S. office vacancy will tumble 40 basis points to 14.9 percent on net absorption of 84 million square feet. Minimal construction and growing demand for larger layouts will support an additional decline in the vacancy rate next year.
  • October hiring provides additional momentum to the U.S. apartment sector. Through the first three quarters this year, the U.S. vacancy rate slid 60 basis points to 3.9 percent, the lowest quarterly reading in 14 years, as more than a quarter million units were absorbed. Construction volumes remain elevated, but the steady growth in demand will maintain the vacancy rate in the low-4 percent range in the coming quarters and support additional concessions burn and higher rents.

To read full report from Marcus & Millichap click here for Research Blog