See APARTMENTS on

from SanTan Sun News - 1.16.2022

by Times Media Group

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APARTMENTS from page 1

Apartments at 125 S. Alma School

Road for $125.3 million – nearly three times the 2015 sale price of $46.2 million. That sale by the Phoenix-based

Conam Group of Companies to

Decron Properties of Los Angeles worked out to $186,250 for each of the 324 apartments spread out across 28 two-story buildings. • The September sale to Windemere

Investments of Texas of the Soleil

Apartments at 725 No. Dobson

Road for $63 million – less than two years after the seller, 3rd Avenue

Investments of Phoenix, bought the 188-apartments-turned-condo complex for $40 million. That represented a per-unit price of $335,106. • California-based Davlyn Investments’

Dec. 15 acquisition of the 280-unit

Broadstone Trevio on S. Ellis Street for $114.4 million – more than twice the $47.5 million price that seller

TruAmerica Multifamily paid for the 16-year-old complex in 2015. • The purchase by Scottsdale-based

Private Portfolio Group and subsidiary Pillar Communities of the 116-townhouse complex called Villas at Chandler Heights last month for $55.1 million only three years after The

Carte Group, the seller, bought it for half that price. • Last month’s sale of the Marquis at

Chandler complex at 2200 W. Frye

Road by Pacifi c Coast Capital Partners to Texas-based CWS Capital Partners for $150 million – 11 months after Pacifi c bought it for $95 million.

That transaction represented a price of $441,176 for each of the Marquis complex’s 340 apartments that are spread across nine four-story buildings.

Both Decron Properties and CWS Capital Partners are real estate investment management companies with similar fi nancial objectives.

CWS says on its website, “We seek investment opportunities with the primary objective of strong growth potential while maintaining preservation of capital.”

Stressing that it is primarily a builder, Decron Properties states its development philosophy “blends land use, entitlement, and construction expertise with a vision that creates lasting value in real estate assets” as long-term investors in real estate.

Chandler by far is not the only East Valley community where mega-deals involving apartment complexes have occurred in the last 12 months.

Just across the I-10 from Chandler, Sares-Regis Group of Newport Beach, California, last month bought the 312unit Arboretum at South Mountain complex on Chandler Boeuilvard at I-10 for $118.3 million – far more than the $45.5 million it sold for in May 2016.

Earlier last fall, Tides Equities of California sold a complex it bought four years ago for $47.2 million to another investment group for $137 million. The following day, Tides Equities bought two Mesa complexes for a total $217.5 million.

Such transactions refl ect what Bloomberg called a shift by real estate investors from offi ces, hotels and malls, which it said “fared poorly in the pandemic.” “The infl ux of money has pushed prices higher and forced private equity fi rms to behave like the aggressive homebuyers in the frenzied housing market,” Bloomberg said. “Some investors are frustrated by current prices for apartment buildings. But many are raising their bids, waiving inspections and promising to close fast, with rising rents driving a fl urry of deals.” It quoted one investment activist as stating: “That’s what happens in a white-hot market. Some of them will sharpen the pencil on the next one and get a little more aggressive because they need to deploy that capital.” According to a number of analysts, the interest in apartment complexes also is being fueled by soaring home prices that have especially impacted fi rst-time homebuyers and aging baby boomers anxious to downsize.

Large investors also aren’t just looking at apartment complexes for the long-term benefi t of a steady revenue stream that rent delivers.

The Cromford Report, which closely watches the Phoenix Metro housing market, noted that large investors also are buying single-family homes in bulk – and not turning them over for resale.

Instead, the Cromford Report noted, “investors are extremely interested in purchasing single-family homes in Phoenix. The receipts from rents are rising faster than anywhere else in the country.

“Rents are rising because there are more people wanting to rent than there are rental properties. Many families are starting to see single-family rentals as preferable to apartments or condo-style rentals. This eff ect is probably supported by living conditions during a pandemic.

“While this continues, we can expect investor demand to remain robust, which in turn prevents the market cooling down as it would if ordinary home buyers were the only source of demand.”

Manage Case, a company that manages apartment complexes, echoed that lure of rent for investors.

“There is little to support any prediction other than rising rent prices,” it said. “Those hoping for a lull in the rising price trend will likely be disappointed.”

The Marquis at Chandler apartment complex on Frye Road sold last month for $150 million – 11 months after the seller paid $95

million for it. (Special to SanTan Sun News)

CHICKEN from page 3

they were eating all the bugs that the scorpions like.”

And as anyone who has had farm fresh eggs will tell you, the taste is much better.

“Obviously the fresher you can get any of your food, the better it’s going to be,” Ellingson said.

Ellingson said she sold her eight chickens on a group website she belonged to. Her coop is still there but empty.

A residential street is right next to her backyard and anyone can see into it through the chain-link fence. That’s how a city inspector discovered she had chickens and had to send her a citation. Ellingson said the inspector told her no one fi led a complaint.

She said if they had a block fence, or lived between two other houses, chances are she would still have her chickens today.

Her neighbors continued to support her owning chickens, she said. They would even help corral them when one would escape the back yard, which happened a couple of times before they clipped their wings.

“People would stop by and look at them through the fence,” Ellingson said. “They’d ask how the chickens are doing. Nobody complained about it.”

Rick Huemann, chair of the city’s Planning and Zoning Commission, says it’s too soon to know which way it might go.

“It depends on what staff recommends,” he said.

He said while Ellingson’s neighbors may have no issue with her raising hens, the neighbors two streets down may have a problem with one of their neighbors doing the same, especially if they have a rooster, which is much nosier.

Heumann said you have to set standards for everyone.

The last time this came up was in 2013 and a proposal to allow a limited number of chickens in residential backyards was defeated on a 4-3 vote by council. Some of the 75 people who attended because of the topic were concerned about the smell and noise they say chickens generate.

Heumann said this issue will only aff ect older, traditional neighborhoods, because most homeowner associations have rules against wildlife.

Ellingson said she spoke with the mayor and a couple of councilmembers and is hopeful they might change the zoning.

“A couple of the councilmembers came up and expressed their support, but whether or not that actually plays out in a vote, you know, who knows.” An edition of the East Valley Tribune

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Developer sues Chandler over garage rent default

In a dispute that could cost taxpayers millions of dollars, the City of Chandler is being sued for failing to pay its rent of the parking garage at the Overstreet development at Arizona Avenue and Chandler Boulevard.

Developer DT Chandler’s lawyers filed the lawsuit in Maricopa County Superior Court in mid-October and City Council went into executive session on Monday to discuss how to deal with it.

At the heart of the dispute is DT Chandler’s claim that the city did not exercise its option to buy the parking garage correctly. It says that option is now gone, and the city must pay rent as part of their lease agreement.

The city wants to buy the garage for about $8.7 million. If the court sides with DT Chandler, then it would have to pay a little more than $65,000 a month in rent for the next 27 years – about $21.1 million over the life of the lease, DT Chandler claims. Under the terms of the lease, the city paid $26,250 a month for the first three years. The rent increases starting the fourth year.

According to the lawsuit, the city had to notify DT Chandler it planned to exercise its option to purchase the garage for $8,690,351 in writing at least 30 days before the third year ended.

DT Chandler said it was not notified until it received a letter on Aug. 27. It claims the city did not state it was exercising the option and that the letter was not sent to the escrow holder. It also claims the city did not provide the required $150,000 deposit to the escrow holder.

And it claims that written notice of the city’s intent to exercise the option was due on or before Aug. 12, since the lease began on Sept. 11, 2018.

DT Chandler argues the city failed to give the required notice, or take the required steps toward actually purchasing the garage, and therefore must pay the higher rent for the rest of the lease agreement, which was for 30 years.

But the city not only has denied the charges, but also has countersued the developer.

The city contends that the lease “ represents only a portion of the overall dealings between the parties” and that the lease “must be read in conjunction with” development and option agreements.

Besides, the city says, the document the plaintiff attached to the complaint “does not bear the stamp of a document recorded with the Maricopa County Recorder’s Office and which the City considers the official version of the document.”

The City also notes that the pandemic was a major event that automatically extended the deadline for any action on Chandler’s part.

It also says it offered the purchase agreement “in the form required by the documents which DTC refused to execute” and that DT Chandler’s allegations “misstate the nature of the documents and imposes and assumes obligations not set forth in the documents. The City denies failing to comply the terms of the documents.”

The City also disputes the calculations DT Chandler made in what it is owed, suggesting DT Chandler has over-simplified the whole matter.

“The City acknowledges the dispute over the Option is one issue before the Court," the responses states. "However, that issue will also require the Court to resolve whether a valid, enforceable agreement exists between the parties, and …whether Plaintiff is a proper party to any agreement, whether it breached any contract that exists and the damages incurred by the City as a result of that breach. The City denies this dispute is capable of simple resolution with only a determination of the ‘option’ issue.”

Chandler also filed a counterclaim against DT Chandler, contending it had already agreed to extend the deadline for exercising its option to October 2022 and that it had agreed on a sale price of $8.8 million, with rent payments going toward that purchase.

It asks the court to rule that the city is the actual owner of the site or declare the lease escalation rate “unenforceable.”

The case has been assigned to Superior Court Commissioner Richard Albrecht.

The parking garage at the Overstreet development in downtown Chandler is the subject of a lawsuit filed against the city. (File photo)

CUSD disputes advocate’s school safety concerns

BY PAUL MARYNIAK

Executive Editor

Chandler Unified School District is rebutting what a spokesman called “some false or incomplete information” in a letter it received about its school safety protocols.

Katey McPherson, a mother of four CUSD students and a well-known advocate for improved mental health services for young people, last month wrote the administration and Governing Board about her concerns in the aftermath of the fatal school shooting in Michigan in November and a subsequent school-shooter scare at a Michigan school district attended by her sister’s kids.

McPherson expressed a number of concerns, including the “need to increase parent awareness around sharing, re-sharing and inciting more chaos during a potential lockdown.”

In response, district spokesman Terry Locke said, “Our Community Relations team produced a video for the safety/security division School Emergency Protocols for Parents and Guardians. This parent response video was sent to parents and posted on the CUSD safety website.

“It details the dangers of parents sharing misinformation and provides direction for parents during a critical incident, Locke said. The video is at cusd80.com/Domain/81.

Locke also said the district “has initiated and implemented a Speak Up for Safety anonymous reporting program that has been in place for two years” and utilized at all grade levels and that cards were handed out to students that advertised that program.

In addition, he said, “a service called Gaggle monitors students’ writing to look for key words such as suicide, alcohol, drugs, bullying, profanity, etc. School and district administrators are notified of anything concerning. Students and parents are contacted by administrators and/or counselors.”

Locke said administrators last year “reviewed training video links divided into three age-appropriate videos to assist schools with options other than lockdowns to include barricading and when to flee” and that the video is on the CUSD safety website.

“All of our sites exercise evacuation drills in conjunction with law enforcement agencies,” he added. “Elementary schools are required to participate every two years.”

Locke also disputed McPherson’s criticism of how regularly the district assesses every school’s infrastructure.

Stating Chandler Unified is “one of few districts that have elementary campus security (ECS) officers assigned to their sites,” he said they “assist administrators with emergency plans and conduct daily walkthrough of sites.

“Our sites’ infrastructure is reviewed not just periodically, but daily,” he said. “In addition, we had a comprehensive threat vulnerability assessment completed at all schools. These were hours-long assessments completed by law enforcement personnel. This project was very thorough, taking months to complete.”

He also said administrators in 2019 took an eight-hour training course taught by Chandler police and firefighters.

“Lauded as a unique and forward-thinking program that allows for open communication and collaboration,” the training covered “social media awareness, stop-the-bleed and CPR overview, what to expect with fire and law enforcement response," he said. "It proved to be a very comprehensive course and valuable to our administrators.”

He also said the district has conducted a campaign that addresses "the consequences of social media,” which also is on the district’s website. “The video interviews law enforcement who drive home the point of the possible actions of statements that be considered threatening in nature to others,” he said.

Locke said safety plans for the entire district and individual schools “are reviewed and updated every year” and shared with public safety agencies in Queen Creek, Gilbert and Chandler – all homes to district schools.

“Sites have School Safety Prevention and Assessment Team in place for an approach with multidisciplinary teams meeting to include counselors, security, administrators, nurses to discuss safety issues,” he said.

In response to McPherson’s questions about whether the district has tried to assess the pandemic’s impact on student well-being and other safety and mental health issues by surveying and talking with students, Locke said:

“We garner student feedback and are very cognizant to include their ideas and solutions. The counseling and social services department focuses on reaching out to groups of students at our high schools. Some of their feedback became a part of our student wellness initiative response.

“All of CUSD student wellness pieces focus on prevention and on evidence-based curriculum,” he said, adding parents and staff are brought into education and training related to safety.