(Read more on the multifamily market.)
PHOENIX-SW Central LLC, a company formed by the locally based Southwest Development Group, has paid $7 million for a site in the Central Avenue Corridor to develop two 46-story residential condominium towers. The 1.56-acre property abuts the Phoenix Museum of Art.
According to Southwest Development managing partner Beau Woodring, the company will spend upward of $250 million to build the project, which will have 700 to 800 units. The buildings will be named Museum Towers for their location adjacent to the museum. The site is near the southeast corner of Central Avenue and McDowell Road.
No specific timeline has been set for construction, but architectural work has begun. Woodring says he expects presales to begin a year from now, with prices projected to start at about $300,000. "We will not begin construction till we see how presales go," he tells GlobeSt.com, "but the earliest date for building would be in about 18 months."
In general, Woodring says Phoenix condo sales have been slow. He also doubts if the market will change significantly in the coming 12 months. But he points out the project's long-term prospects are excellent because the metropolitan area consistently ranks as the fastest-growing major market in the country and is expected to remain so for the next quarter century.
In addition, Woodring continues, the Central Avenue Corridor, commonly referred to as CenCo, is the city's favored location for high-rise living. "People are moving here from New York, California, Canada and even Europe," he says. "And they're looking for an urban lifestyle. In Phoenix, that lifestyle is best presented in the CenCo submarket."
The project, which is near a planned light-rail station, will be Southwest Development's first in the Phoenix area. Woodring says he and his colleagues are looking "very closely" at two additional potential high-rise residential development sites in Central Phoenix. He says the decision to move forward on those will depend on combination of economic viability and marketplace supply-demand factors. The company is an affiliate of Detroit-based Soave Enterprises LLC, a privately-held firm with holdings in dozens of companies and a portfolio that generates annual sales in excess of $1 billion.
Michael Lieb of Michael A. Lieb Ltd. in Phoenix brokered the sale. Harvey Jay Migdal of Scottsdale, AZ was the seller.
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