Los Arcos Crossing lender to market 14 acres to developers

The lender for Los Arcos Crossing in south Scottsdale took ownership of the failed shopping center this week and plans to market it to developers within a month.

ML Manager LLC got the property after no bids were made at a trustee sale Thursday, said Mark Winkleman, chief operating officer of the Peoria firm. The company will interview real estate brokers next week and select one to start marketing the 14-acre parcel in September, he said.

The potential sale of the property on the southwestern corner of Miller and McDowell roads, in the heart of the McDowell Road corridor, comes as Scottsdale is pushing for redevelopment of the area. The once-thriving strip has lost auto dealers, grocery stores and other retailers as residents and growth moved northward.

The city is inviting developers' proposals for 3.7 vacant acres between Los Arcos Crossing and SkySong, the ASU Scottsdale Innovation Center. At least three developers have said they are interested in assembling most, if not all, of the nearby property to create a larger project.

"The city realizes there is likely more value in (parcels) being combined," economic vitality specialist Mark Hunsberger told more than a dozen attendees at a pre-proposal conference last week.

Kevin Ransil of Ransil Development Group, who attended the conference, said his Scottsdale company would be interested in the whole parcel, though apartments could be a viable first phase on the city parcel.

"The trick is what are the other uses." he said. "Whoever obtains the larger piece dictates."

Brian Kocour of Cassidy Turley BRE Commercial said the city parcel could be used for a green hotel. Development could then spread outward, he said, with restaurants, retail and connections to the Indian Bend Wash greenbelt to the east.

Another company envisioning a larger project is Global Entertainment Corp. of Tempe, which has proposed building an event center that would host community events and commercial performances.

Phoenix developer PDG America acquired most of Los Arcos Crossing in 2007 with plans to develop it as Scottsdale CentroVida, a $150 million mix of townhouses, apartments, restaurants and neighborhood shops. The deal was financed by Mortgages Ltd., a high-flying Phoenix investment firm that collapsed in bankruptcy after its chief executive committed suicide in 2008.

ML Manager was formed by investors as the successor to Mortgages Ltd.

PDG, which stopped making its payments on Los Arcos Crossing in 2008, took no action to stop this week's trustee sale, Winkleman said.

ML Manager hasn't set a price for Los Arcos Crossing. The broker would help the company decide that issue and show the property to prospective buyers, Winkleman said.

Proposals for the city parcel are due Oct. 1. A public open house is planned, and the City Council could review staff recommendations in November.

ML Manager's property has an empty Bashas' grocery store, a second building that once housed a gym and shops, a closed gas station and the pad where an auto-parts store still operates. Separately owned facilities in the area include a carwash, a tire store, an office/commercial complex and Los Arcos United Methodist Church.

by Jane Larson The Arizona Republic Aug. 6, 2010 12:05 PM



Los Arcos Crossing lender to market 14 acres to developers