Development on a big chunk of northeast Phoenix's popular Desert Ridge community is no longer on hold. That means more money could start flowing to Arizona schools.
Showing posts with label citynorth. Show all posts
Showing posts with label citynorth. Show all posts
Sunday, February 3, 2019
Phoenix's Desert Ridge City North land sold in bankruptcy deal, development to finally restart
Sunday, January 19, 2014
CityCenter reviving under new ownership
The new owners of CityCenter of CityNorth, a mixed-use development near Desert Ridge in northeast Phoenix, say they’re attracting new tenants, filling vacancies and improving the property.
The development has faced legal and economic troubles since opening in 2008 during the economic downturn. Scanlan Kemper Bard Cos., a real-estate private-equity firm based in Portland, Ore., and Wayzata Investment Partners purchased the property for $67 million in April.
Read more...CityCenter reviving under new ownership
Wednesday, April 17, 2013
CityNorth sale set to close
A deal to sell CityCenter of CityNorth, a mixed-use development near Desert Ridge in northeast Phoenix, is expected to close this week.
Scanlan Kemper Bard Companies, a real-estate private-equity firm based in Portland, Ore., and Wayzata Investment Partners, reportedly are auiring the long-troubled development.
Read more: CityNorth sale set to close
Saturday, October 27, 2012
CityNorth developer suing law firm
A prominent Phoenix law firm is the target of a lawsuit claiming its actions put the developer of CityNorth out of business.
The developer, a subsidiary of the Klutznick Co. called Northeast Phoenix Partners, also controlled development rights throughout the 5,700-acre Desert Ridge development in northeast Phoenix.
But Northeast Phoenix Partners, or NPP, lost both CityNorth and Desert Ridge in a lawsuit with another developer, Gray Development Group, resolved earlier this year.
The new lawsuit, filed last week, claims Gammage & Burnham was NPP’s attorney when it advised Gray on how to proceed with an effort to increase residential density on a Desert Ridge parcel north of Desert Ridge Marketplace. The suit says Gammage gave NPP conflicting advice, urging them to oppose Gray’s effort.
Read more: CityNorth developer suing law firm
Saturday, August 18, 2012
Developer gets CityNorth land
CityNorth and Desert Ridge, once expected to be the crown jewels of Phoenix's expansion into empty lands north of Loop 101 in northeast Phoenix, have been turned over to a new developer.
As a result of a long, detailed lawsuit, Gray Development Group of Phoenix has won control of the undeveloped 140 acres of CityNorth and with it, master developer responsibilities at Desert Ridge.
Desert Ridge is a 5,700-acre master-planned development centered at Tatum Boulevard and Loop 101. CityNorth, located on the northwest corner of 56th Street and Loop 101, is planned as a large, multiple-use development with upscale shopping, homes and hotels.
A group called Northeast Phoenix Partners controlled the land after winning the initial auction of the Desert Ridge commercial core in 1993. The Klutznick Co., the original developers of CityNorth, took over the partnership several years later.
NPP got into trouble when exercising its rights as master developer clashed with Gray.
Gray, a developer of upscale apartments in the Valley, had purchased land north of Desert Ridge Marketplace in 2004, and it later won zoning variances for the property that enabled it to add density to the project.
NPP, which enforced the covenants, conditions and restrictions for the entire Desert Ridge area, challenged the variances and lost. In the process, Gray countersued, arguing that NPP and the Klutznick Co. interfered with its efforts to develop the land. Gray eventually defaulted on the property, and it remains vacant.
Gray won a $110.7 million jury verdict in the case in 2010.
NPP/Klutznick, meanwhile, defaulted on Phase 1 of CityNorth and lost a portion of the property. It has been unable to develop the land further.
NPP, unable to pay the verdict, entered into mediated negotiations with Gray, which accepted the land and master developer rights in a settlement. That activity took place over the past month, and the deal was recently closed.
It is unknown now what Gray will do with the property. Company president Bruce Gray was unavailable for comment.
The principals of the Klutznick Co., John and Daniel Klutznick, closed up shop and moved out of town a year ago.
They were not available for comment.
Since the mediation began, lawyers in the case have not commented.
Others involved in the growth and development of Desert Ridge were pleased that the lawsuit is over.
Former Phoenix City Councilwoman Peggy Neely, who as a representative for the area was deeply involved in the dispute and Desert Ridge generally, said she hopes growth in the area can resume now that the legal cloud has dissipated.
"Hopefully the future of Desert Ridge can once again move forward with the settlement of this lawsuit," she said, "and the community and the city can again see this highly desirable area become a productive commercial and residential community again."
Doug Dickson, president of the Desert Ridge Community Association, said the resolution should help clarify the future of CityNorth.
"To the extent that this accelerates growth in the retail and commercial development of Desert Ridge, it is a positive and welcomed event for our community."
by Michael Clancy - Jul. 15, 2012 The Republic | azcentral.com
Developer gets CityNorth land
As a result of a long, detailed lawsuit, Gray Development Group of Phoenix has won control of the undeveloped 140 acres of CityNorth and with it, master developer responsibilities at Desert Ridge.
Desert Ridge is a 5,700-acre master-planned development centered at Tatum Boulevard and Loop 101. CityNorth, located on the northwest corner of 56th Street and Loop 101, is planned as a large, multiple-use development with upscale shopping, homes and hotels.
A group called Northeast Phoenix Partners controlled the land after winning the initial auction of the Desert Ridge commercial core in 1993. The Klutznick Co., the original developers of CityNorth, took over the partnership several years later.
NPP got into trouble when exercising its rights as master developer clashed with Gray.
Gray, a developer of upscale apartments in the Valley, had purchased land north of Desert Ridge Marketplace in 2004, and it later won zoning variances for the property that enabled it to add density to the project.
NPP, which enforced the covenants, conditions and restrictions for the entire Desert Ridge area, challenged the variances and lost. In the process, Gray countersued, arguing that NPP and the Klutznick Co. interfered with its efforts to develop the land. Gray eventually defaulted on the property, and it remains vacant.
Gray won a $110.7 million jury verdict in the case in 2010.
NPP/Klutznick, meanwhile, defaulted on Phase 1 of CityNorth and lost a portion of the property. It has been unable to develop the land further.
NPP, unable to pay the verdict, entered into mediated negotiations with Gray, which accepted the land and master developer rights in a settlement. That activity took place over the past month, and the deal was recently closed.
It is unknown now what Gray will do with the property. Company president Bruce Gray was unavailable for comment.
The principals of the Klutznick Co., John and Daniel Klutznick, closed up shop and moved out of town a year ago.
They were not available for comment.
Since the mediation began, lawyers in the case have not commented.
Others involved in the growth and development of Desert Ridge were pleased that the lawsuit is over.
Former Phoenix City Councilwoman Peggy Neely, who as a representative for the area was deeply involved in the dispute and Desert Ridge generally, said she hopes growth in the area can resume now that the legal cloud has dissipated.
"Hopefully the future of Desert Ridge can once again move forward with the settlement of this lawsuit," she said, "and the community and the city can again see this highly desirable area become a productive commercial and residential community again."
Doug Dickson, president of the Desert Ridge Community Association, said the resolution should help clarify the future of CityNorth.
"To the extent that this accelerates growth in the retail and commercial development of Desert Ridge, it is a positive and welcomed event for our community."
by Michael Clancy - Jul. 15, 2012 The Republic | azcentral.com
Developer gets CityNorth land
Tuesday, November 22, 2011
Phoenix, CityNorth developer clash - USATODAY.com
Phoenix's effort to revoke its $97.4million development agreement with the developer of CityNorth has gotten off to a rocky start.
Phoenix sent a letter to an attorney for the Klutznick Co. arguing that Klutznick has defaulted on the terms of the agreement.
Scott Hershman, who said Tuesday that he had not been in contact with the city, responded with a demand for the full amount of the agreement, claiming the city was interfering in the company's contractual rights. He also threatened a lawsuit.
The City Council in October directed city staff to study how to end the contract, which the city spent more than $750,000 in court defending from 2007 to 2010.
The agreement with Klutznick calls for the city to share with the developer half of the sales taxes generated at the northeast Phoenix project for 11 years and three months, or a maximum of $97.4million. The sharing agreement would start after the developer opened 1.2million square feet of retail space, plus parking structures with more than 3,000 free spaces.
An Arizona Republic analysis in 2009 indicated that for the project to bring in $97.4million over its lifetime, it would have to be one of the most successful retail projects in the nation.
CityNorth was envisioned as a $1.2billion project that, upon completion, would have about 6million square feet of mixed-use development. To date, 175,000 square feet of retail has been developed.
If the Klutznick Co. does not agree to walk away from the deal, the city will have to seek a legal settlement.
Meanwhile, Deputy City Manager David Krietor maintains that the agreement will never take effect. No progress has taken place on the project since 2008, when Phase 1 opened.
Phase 1 now is under separate ownership from the remainder of the 144-acre parcel, and a Klutznick Co. subsidiary, Northeast Phoenix Partners, is on the hook for a legal judgment of more than $100million in an unrelated case. It may need to use the land to satisfy the judgment.
by Michael Clancy The Arizona Republic Nov 19, 2011
Phoenix, CityNorth developer clash - USATODAY.com
Phoenix sent a letter to an attorney for the Klutznick Co. arguing that Klutznick has defaulted on the terms of the agreement.
Scott Hershman, who said Tuesday that he had not been in contact with the city, responded with a demand for the full amount of the agreement, claiming the city was interfering in the company's contractual rights. He also threatened a lawsuit.
The City Council in October directed city staff to study how to end the contract, which the city spent more than $750,000 in court defending from 2007 to 2010.
The agreement with Klutznick calls for the city to share with the developer half of the sales taxes generated at the northeast Phoenix project for 11 years and three months, or a maximum of $97.4million. The sharing agreement would start after the developer opened 1.2million square feet of retail space, plus parking structures with more than 3,000 free spaces.
An Arizona Republic analysis in 2009 indicated that for the project to bring in $97.4million over its lifetime, it would have to be one of the most successful retail projects in the nation.
CityNorth was envisioned as a $1.2billion project that, upon completion, would have about 6million square feet of mixed-use development. To date, 175,000 square feet of retail has been developed.
If the Klutznick Co. does not agree to walk away from the deal, the city will have to seek a legal settlement.
Meanwhile, Deputy City Manager David Krietor maintains that the agreement will never take effect. No progress has taken place on the project since 2008, when Phase 1 opened.
Phase 1 now is under separate ownership from the remainder of the 144-acre parcel, and a Klutznick Co. subsidiary, Northeast Phoenix Partners, is on the hook for a legal judgment of more than $100million in an unrelated case. It may need to use the land to satisfy the judgment.
by Michael Clancy The Arizona Republic Nov 19, 2011
Phoenix, CityNorth developer clash - USATODAY.com
Sunday, October 16, 2011
Phoenix seeks to cancel $97.4 million pact with CityNorth
The Phoenix City Council has decided to pursue efforts to end the city's $97.4 million agreement to assist CityNorth's development, an accord that the city spent more than $750,000 in court defending between 2007 and 2010.
The council on Tuesday voted 6-0, with three members absent, to ask the city manager to work out the details.
Councilman Tom Simplot said times have changed since the contract was approved in March 2007. He and Councilman Michael Johnson were the only members present who voted on the contract in 2007. Simplot was a no vote.
"This is the right course for taxpayers," Simplot said.
Johnson, who made the motion on Tuesday, supported CityNorth in 2007.
Councilman Jim Waring, who requested the item be placed on the council's policy agenda, said the agreement has always been controversial. He also noted that it is open-ended, meaning the city could be on the hook in the sales tax-sharing deal forever.
The agreement with the Klutznick Co., developer of CityNorth, calls for the city to share with the developer half the sales taxes generated at the northeast Phoenix project for 11 years and 3 months, or a maximum of $97.4 million. The sharing agreement would start after the developer opens 1.2 million square feet of retail space, plus parking structures with more than 3,000 free spaces. There is no time limit on the agreement.
Bordered on the west by Desert Ridge Marketplace, on the east by 56th Street, and to the south by Loop 101, CityNorth was envisioned as a $1.2 billion project that, upon completion, would have about 6 million square feet of mixed-use development. To date, a total of 175,000 square feet of retail has been developed.
David Krietor, the deputy city manager who oversees economic development, estimated that, given all that has happened since 2007, the agreement would never take effect. His reasons:
- Phase 1, the shops, offices and apartments on High Street, is now separate from the remainder of the project due to a foreclosure.
- Ownership of the remaining land is up in the air as Klutznick, under the corporation known as Northeast Phoenix Partners, may lose it as payment in a lawsuit it lost to Gray Development Group over development of a nearby parcel.
- A future owner would be unlikely to have the same vision of a dense, urban "second downtown" that Klutznick promised to city officials in 2007.
Krietor said the project is far from meeting the required performance criteria.
"The extremely choppy waters of the recession" have virtually derailed the project, he said.
Clint Bolick, an attorney for the Goldwater Institute, agreed with Krietor. Bolick, who filed and lost a lawsuit against the agreement, said Tuesday's decision was "a significant symbolic step" that he hopes "indicates the council has overcome its subsidy addiction."
"This was a grandiose scheme that seemed destined to fail from the beginning," Bolick said.
Krietor said the effort is now up to the city's Law Department, but he could say no more because the issues were discussed in executive session.
Questions that need to be asked include whether the contract sticks with the property or with the Klutznick Co. The developer has mentioned the contract as a possible asset, along with the undeveloped property, that it could use to settle the $160 million legal judgment that it owes Gray.
Klutznick representatives declined to return calls.
by Michael Clancy The Arizona Republic Oct. 14, 2011 12:19 PM
Phoenix seeks to cancel $97.4 million pact with CityNorth
The council on Tuesday voted 6-0, with three members absent, to ask the city manager to work out the details.
Councilman Tom Simplot said times have changed since the contract was approved in March 2007. He and Councilman Michael Johnson were the only members present who voted on the contract in 2007. Simplot was a no vote.
"This is the right course for taxpayers," Simplot said.
Johnson, who made the motion on Tuesday, supported CityNorth in 2007.
Councilman Jim Waring, who requested the item be placed on the council's policy agenda, said the agreement has always been controversial. He also noted that it is open-ended, meaning the city could be on the hook in the sales tax-sharing deal forever.
The agreement with the Klutznick Co., developer of CityNorth, calls for the city to share with the developer half the sales taxes generated at the northeast Phoenix project for 11 years and 3 months, or a maximum of $97.4 million. The sharing agreement would start after the developer opens 1.2 million square feet of retail space, plus parking structures with more than 3,000 free spaces. There is no time limit on the agreement.
Bordered on the west by Desert Ridge Marketplace, on the east by 56th Street, and to the south by Loop 101, CityNorth was envisioned as a $1.2 billion project that, upon completion, would have about 6 million square feet of mixed-use development. To date, a total of 175,000 square feet of retail has been developed.
David Krietor, the deputy city manager who oversees economic development, estimated that, given all that has happened since 2007, the agreement would never take effect. His reasons:
- Phase 1, the shops, offices and apartments on High Street, is now separate from the remainder of the project due to a foreclosure.
- Ownership of the remaining land is up in the air as Klutznick, under the corporation known as Northeast Phoenix Partners, may lose it as payment in a lawsuit it lost to Gray Development Group over development of a nearby parcel.
- A future owner would be unlikely to have the same vision of a dense, urban "second downtown" that Klutznick promised to city officials in 2007.
Krietor said the project is far from meeting the required performance criteria.
"The extremely choppy waters of the recession" have virtually derailed the project, he said.
Clint Bolick, an attorney for the Goldwater Institute, agreed with Krietor. Bolick, who filed and lost a lawsuit against the agreement, said Tuesday's decision was "a significant symbolic step" that he hopes "indicates the council has overcome its subsidy addiction."
"This was a grandiose scheme that seemed destined to fail from the beginning," Bolick said.
Krietor said the effort is now up to the city's Law Department, but he could say no more because the issues were discussed in executive session.
Questions that need to be asked include whether the contract sticks with the property or with the Klutznick Co. The developer has mentioned the contract as a possible asset, along with the undeveloped property, that it could use to settle the $160 million legal judgment that it owes Gray.
Klutznick representatives declined to return calls.
by Michael Clancy The Arizona Republic Oct. 14, 2011 12:19 PM
Phoenix seeks to cancel $97.4 million pact with CityNorth
Sunday, May 22, 2011
CityScape developer takes on 2 more projects
The developer of downtown Phoenix's $500 million CityScape retail and office project is going to handle leasing and management of two other Phoenix office and retail centers: Town & Country Shops at 20th Street and Camelback Road and the embattled CityNorth in the city's northeastern corridor, near Loop 101 and Arizona 51.
RED Development has entered a 50-50 joint venture with Town & Country Camelback, a limited-liability company that owns Town & Country, said Mike Ebert, a managing partner at RED.
RED also has a separate agreement to manage and lease spaces at High Street - an office, residential and retail project at CityNorth, a 144-acre property that has been tangled in legal battles. That deal includes managing and leasing the luxury apartments on the site.
The terms of the agreements at the two properties are private. But Ebert said RED was well-positioned to take over their leasing, given its track record with development and leasing in the Phoenix area.
RED is building a Target center in Chandler, and it has nearly filled CityScape.
"We have in-house leasing, development, management, financing and marketing," Ebert said. "Those are all the things it takes to operate properties."
While some developers are still struggling to recover from the recession, RED, which has offices at CityScape and in Kansas City, Mo., is expanding its roots in Phoenix. But it has taken on two projects that have challenges.
CityNorth
High Street at CityNorth has about 628,000 square feet of space. RED said the 99 luxury apartments that were part of the project are 97 percent leased. Retail tenants include restaurants such as Kona Grill, Blue Martini, Mojo Yogurt and Ocean Prime.
Ebert said RED's new role at High Street would not impact the legal cases that have hindered development around the 144-acre CityNorth, which has been the center of legal disputes.
High Street opened in November 2008 and was CityNorth's first phase. More phases were supposed to open annually, but the recession led to the withdrawal of three department stores and a halt to development. The first phase went into foreclosure in January 2010 and was sold in July to the lender, Capmark Financial Group.
The rest of the land remained under control of Northeast Phoenix Partners, which in turn was controlled by the Klutznick Co.
Klutznick teamed with Related Urban Development to promote the site. But NPP may lose control of the property once a resolution is reached in a $110.7 million legal verdict that NPP lost to Gray Development Group.
Gray won the verdict in a lawsuit alleging NPP had blocked its efforts to develop a different parcel. The matter now is in mediation.
The economic-development agreement with Phoenix for CityNorth remains alive. It survived a court challenge, but CityNorth is far from meeting the benchmarks required for the deal to take effect.
Under the deal, Phoenix will give the developer either half of the sales taxes collected at CityNorth for 11 years and three months or about $97.4 million - whichever comes first. In return, the developer will build about 3,180 free parking spaces, with 200 of those for park-and-ride use.
The deal goes through only if CityNorth first opens 1.2 million square feet of sales-tax-generating retail space. An analysis by The Arizona Republic shows that for CityNorth to reach the $97.4 million mark by the deadline, it will have to become one of the most successful shopping areas in the state.
Town & Country
Ebert said he and the other partners at RED have wanted to work on something with Town & Country Shops for at least three years. They knew that the residential areas around the center have been filling up with new homeowners, and local customers continue to patronize the shops in the quaint single-story center, recognized by its rough shingled rooftop.
The 1970s look at the 325,000 square-foot outdoor shopping center is outdated, but "everybody loves it," Ebert said.
The anchor tenant is Trader Joe's. Other renters are LA Fitness, My Sister's Closet, Yogurtology and Hi Health. A farmer's market also is held there.
Ebert said RED was filing the paperwork to knock down the Black Angus building on the property and come up with a plan for possible revitalization.
RED managing partner Scott Rehorn, who handles leasing agreements, said the challenge RED faced at Town & Country is updating it without damaging its charm.
But Jim Shough of Town & Country Camelback believes the new partnership with RED, a company largely known for building and leasing shopping centers will be a boost to Town & Country.
"We are optimistic about the revitalization of this Phoenix landmark with RED's involvement and look forward to sharing more plans with the community as we move ahead," he said in a statement.
by Emily Gersema and Michael Clancy The Arizona Republic May. 19, 2011 12:00 AM
CityScape developer takes on 2 more projects
RED Development has entered a 50-50 joint venture with Town & Country Camelback, a limited-liability company that owns Town & Country, said Mike Ebert, a managing partner at RED.
RED also has a separate agreement to manage and lease spaces at High Street - an office, residential and retail project at CityNorth, a 144-acre property that has been tangled in legal battles. That deal includes managing and leasing the luxury apartments on the site.
The terms of the agreements at the two properties are private. But Ebert said RED was well-positioned to take over their leasing, given its track record with development and leasing in the Phoenix area.
RED is building a Target center in Chandler, and it has nearly filled CityScape.
"We have in-house leasing, development, management, financing and marketing," Ebert said. "Those are all the things it takes to operate properties."
While some developers are still struggling to recover from the recession, RED, which has offices at CityScape and in Kansas City, Mo., is expanding its roots in Phoenix. But it has taken on two projects that have challenges.
CityNorth
High Street at CityNorth has about 628,000 square feet of space. RED said the 99 luxury apartments that were part of the project are 97 percent leased. Retail tenants include restaurants such as Kona Grill, Blue Martini, Mojo Yogurt and Ocean Prime.
Ebert said RED's new role at High Street would not impact the legal cases that have hindered development around the 144-acre CityNorth, which has been the center of legal disputes.
High Street opened in November 2008 and was CityNorth's first phase. More phases were supposed to open annually, but the recession led to the withdrawal of three department stores and a halt to development. The first phase went into foreclosure in January 2010 and was sold in July to the lender, Capmark Financial Group.
The rest of the land remained under control of Northeast Phoenix Partners, which in turn was controlled by the Klutznick Co.
Klutznick teamed with Related Urban Development to promote the site. But NPP may lose control of the property once a resolution is reached in a $110.7 million legal verdict that NPP lost to Gray Development Group.
Gray won the verdict in a lawsuit alleging NPP had blocked its efforts to develop a different parcel. The matter now is in mediation.
The economic-development agreement with Phoenix for CityNorth remains alive. It survived a court challenge, but CityNorth is far from meeting the benchmarks required for the deal to take effect.
Under the deal, Phoenix will give the developer either half of the sales taxes collected at CityNorth for 11 years and three months or about $97.4 million - whichever comes first. In return, the developer will build about 3,180 free parking spaces, with 200 of those for park-and-ride use.
The deal goes through only if CityNorth first opens 1.2 million square feet of sales-tax-generating retail space. An analysis by The Arizona Republic shows that for CityNorth to reach the $97.4 million mark by the deadline, it will have to become one of the most successful shopping areas in the state.
Town & Country
Ebert said he and the other partners at RED have wanted to work on something with Town & Country Shops for at least three years. They knew that the residential areas around the center have been filling up with new homeowners, and local customers continue to patronize the shops in the quaint single-story center, recognized by its rough shingled rooftop.
The 1970s look at the 325,000 square-foot outdoor shopping center is outdated, but "everybody loves it," Ebert said.
The anchor tenant is Trader Joe's. Other renters are LA Fitness, My Sister's Closet, Yogurtology and Hi Health. A farmer's market also is held there.
Ebert said RED was filing the paperwork to knock down the Black Angus building on the property and come up with a plan for possible revitalization.
RED managing partner Scott Rehorn, who handles leasing agreements, said the challenge RED faced at Town & Country is updating it without damaging its charm.
But Jim Shough of Town & Country Camelback believes the new partnership with RED, a company largely known for building and leasing shopping centers will be a boost to Town & Country.
"We are optimistic about the revitalization of this Phoenix landmark with RED's involvement and look forward to sharing more plans with the community as we move ahead," he said in a statement.
by Emily Gersema and Michael Clancy The Arizona Republic May. 19, 2011 12:00 AM
CityScape developer takes on 2 more projects
Saturday, November 13, 2010
Developer calls for update in Phoenix Desert Ridge plan
A recent victory in a lawsuit could result in more than CityNorth changing hands.
When Gray Development Group prevailed in the lawsuit and won a jury verdict of $110.7 million, it became likely that Gray could take over the very party it defeated in court.
Although the case is far from complete, the result of the verdict could give Gray control of the remaining, undeveloped property at CityNorth, access to the $110.7 million economic development agreement that CityNorth has with the city and, finally, control of Northeast Phoenix Partners.
NPP was the losing party in the lawsuit. Besides being prime developer of CityNorth, NPP - controlled by the Klutznick Co. - has been the master developer of the entire 5,700-acre Desert Ridge master-planned community.
The master developer controls compliance with the Desert Ridge Specific Plan and oversees other governing documents for the northeast Phoenix community.
Bruce Gray, president of Gray Development, says one of the first things he would do is call for an update of the plan, which is 20 years old.
"Many of the original design assumptions proved to be incorrect, and many changes have been made by others over the years - most by NPP," he said. "That's the reason traffic is such a mess up there."
At least 18 amendments have been grafted into the plan to enable development that otherwise could not take place.
Gray said discussions about updating the plan would include the Desert Ridge Community Association, the Arizona State Land Department and city planners. He expects no action at least until the economy recovers.
The Desert Ridge Community Association is the area's homeowners association, with control over covenants, conditions and restrictions, or CC&Rs, that deal with specific issues in the community.
Claudia Garza, president of the homeowners' group, did not respond to requests for comment. The community association was part of the lawsuit originally, but settled out of court.
In previous interviews, she has accused Gray of disregarding the Desert Ridge plan. She said in 2007 that if Gray gets its way, the entire Desert Ridge community would be hurt.
Jim Adams, director of the State Land Department's Real Estate Division, declined to say whether the department would like a complete re-evaluation of the plan.
"Over the years, Desert Ridge has been very successful, and we anticipate it will be successful when the market recovers," he said. "We have made a number of changes and amendments over the years, and we will continue to do that. All master plans evolve."
Michelle Dodds, a city planner with responsibility for the plan, said it would make sense to revisit the plan - if only to reflect current realities.
She said amendments made to the plan were not reflected in other parts of the document, resulting in numerous inconsistencies. For example, she said, the total number of units differs in various sections of the plan, and maps are outdated.
by Michael Clancy The Arizona Republic Nov. 12, 2010 09:32 AM
Developer calls for update in Phoenix Desert Ridge plan
When Gray Development Group prevailed in the lawsuit and won a jury verdict of $110.7 million, it became likely that Gray could take over the very party it defeated in court.
Although the case is far from complete, the result of the verdict could give Gray control of the remaining, undeveloped property at CityNorth, access to the $110.7 million economic development agreement that CityNorth has with the city and, finally, control of Northeast Phoenix Partners.
NPP was the losing party in the lawsuit. Besides being prime developer of CityNorth, NPP - controlled by the Klutznick Co. - has been the master developer of the entire 5,700-acre Desert Ridge master-planned community.
The master developer controls compliance with the Desert Ridge Specific Plan and oversees other governing documents for the northeast Phoenix community.
Bruce Gray, president of Gray Development, says one of the first things he would do is call for an update of the plan, which is 20 years old.
"Many of the original design assumptions proved to be incorrect, and many changes have been made by others over the years - most by NPP," he said. "That's the reason traffic is such a mess up there."
At least 18 amendments have been grafted into the plan to enable development that otherwise could not take place.
Gray said discussions about updating the plan would include the Desert Ridge Community Association, the Arizona State Land Department and city planners. He expects no action at least until the economy recovers.
The Desert Ridge Community Association is the area's homeowners association, with control over covenants, conditions and restrictions, or CC&Rs, that deal with specific issues in the community.
Claudia Garza, president of the homeowners' group, did not respond to requests for comment. The community association was part of the lawsuit originally, but settled out of court.
In previous interviews, she has accused Gray of disregarding the Desert Ridge plan. She said in 2007 that if Gray gets its way, the entire Desert Ridge community would be hurt.
Jim Adams, director of the State Land Department's Real Estate Division, declined to say whether the department would like a complete re-evaluation of the plan.
"Over the years, Desert Ridge has been very successful, and we anticipate it will be successful when the market recovers," he said. "We have made a number of changes and amendments over the years, and we will continue to do that. All master plans evolve."
Michelle Dodds, a city planner with responsibility for the plan, said it would make sense to revisit the plan - if only to reflect current realities.
She said amendments made to the plan were not reflected in other parts of the document, resulting in numerous inconsistencies. For example, she said, the total number of units differs in various sections of the plan, and maps are outdated.
by Michael Clancy The Arizona Republic Nov. 12, 2010 09:32 AM
Developer calls for update in Phoenix Desert Ridge plan
Sunday, June 6, 2010
CityNorth sale delayed again
by Michael Clancy The Arizona Republic Jun. 5, 2010 12:00 AM
The CityNorth foreclosure sale scheduled for Wednesday was postponed a second time.
The sale has been rescheduled for June 16. It originally was scheduled to occur March 31.
Capmark Financial filed the foreclosure against the owners of CityNorth's High Street in late December. The owners, the Klutznick Co. and Related Urban Development, owe more than $290 million to Capmark.
The foreclosure is believed to be the largest commercial foreclosure in state history.
As before, no reason was given for the postponement. Elizabeth Hibbs of Quarles and Brady, the law firm that is handling the sale, said Capmark can postpone the sale indefinitely.
Capmark has declined comment.
The foreclosure affects High Street, the initial phase of the 144-acre project at 56th Street and Loop 101 in northeast Phoenix.
High Street's shops, restaurants, offices and apartments opened in November 2008.
Subsequent phases were supposed to open annually, but the economic slump derailed those plans.
No construction activity has taken place there in more than a year.
Unknown at this time is whether anyone will step into the void.
The current owners could avoid foreclosure by finding new financing or filing for bankruptcy. Refinancing with Capmark is unlikely, because Capmark is in bankruptcy.
The Klutznick Co. has kept up to date on payments to the Arizona State Land Department on the remainder of the property but has been unable to secure financing for later phases of the project, which would include large department stores, other shops and outdoor areas.
Phoenix's $97.4 million economic-development agreement with CityNorth hinges on completion of Phase 2 as originally envisioned.
CityNorth sale delayed again
The CityNorth foreclosure sale scheduled for Wednesday was postponed a second time.
The sale has been rescheduled for June 16. It originally was scheduled to occur March 31.
Capmark Financial filed the foreclosure against the owners of CityNorth's High Street in late December. The owners, the Klutznick Co. and Related Urban Development, owe more than $290 million to Capmark.
The foreclosure is believed to be the largest commercial foreclosure in state history.
As before, no reason was given for the postponement. Elizabeth Hibbs of Quarles and Brady, the law firm that is handling the sale, said Capmark can postpone the sale indefinitely.
Capmark has declined comment.
The foreclosure affects High Street, the initial phase of the 144-acre project at 56th Street and Loop 101 in northeast Phoenix.
High Street's shops, restaurants, offices and apartments opened in November 2008.
Subsequent phases were supposed to open annually, but the economic slump derailed those plans.
No construction activity has taken place there in more than a year.
Unknown at this time is whether anyone will step into the void.
The current owners could avoid foreclosure by finding new financing or filing for bankruptcy. Refinancing with Capmark is unlikely, because Capmark is in bankruptcy.
The Klutznick Co. has kept up to date on payments to the Arizona State Land Department on the remainder of the property but has been unable to secure financing for later phases of the project, which would include large department stores, other shops and outdoor areas.
Phoenix's $97.4 million economic-development agreement with CityNorth hinges on completion of Phase 2 as originally envisioned.
CityNorth sale delayed again
Sunday, April 18, 2010
Rents going up at CityNorth
by Michael Clancy The Arizona Republic Apr. 17, 2010 12:00 AM
Tenants at CityNorth's Residences on High Street could be making higher monthly payments when they renew their leases.
Najla Kayyem, vice president of Related Urban Development, which manages CityNorth, said the higher payments are the result of the end to the first-year concession of two months' free rent, which was spread throughout the year. The concessions were used to fill the 99 apartments when they first became available last year.
Kayyem said concessions are not available on any renewed leases. New tenants may or may not receive concessions depending on the unit they lease, she said.
According to the Web site run by P.B. Bell Communities, the manager, five units are available - two one-bedroom units and three with two bedrooms. Rents run from $1,110 to $1,856 a month on the available units. Those with two bedrooms and 2 1/2 baths cost more.
The decision to end the concessions was made in response to demand, Kayyem said.
Not everyone is happy about the decision. One tenant, who asked not to be identified, complained that High Street has not developed as promised and that amenities available at other high-end apartments have not been offered at CityNorth.
Another tenant, Matt Taylor, said his renewal is several months off but called the loss of the concession "standard procedure for most apartment complexes."
"I definitely still get value out of living here," he said. "Of course, you miss out on the stores and businesses that are yet to come, but that should be obvious to anyone who moves into a development that isn't finished yet. I wasn't promised any amenities that aren't here now."
He said he works from home and appreciates nearby conveniences "so I am still very happy here."
Rents going up at CityNorth
Tenants at CityNorth's Residences on High Street could be making higher monthly payments when they renew their leases.
Najla Kayyem, vice president of Related Urban Development, which manages CityNorth, said the higher payments are the result of the end to the first-year concession of two months' free rent, which was spread throughout the year. The concessions were used to fill the 99 apartments when they first became available last year.
Kayyem said concessions are not available on any renewed leases. New tenants may or may not receive concessions depending on the unit they lease, she said.
According to the Web site run by P.B. Bell Communities, the manager, five units are available - two one-bedroom units and three with two bedrooms. Rents run from $1,110 to $1,856 a month on the available units. Those with two bedrooms and 2 1/2 baths cost more.
The decision to end the concessions was made in response to demand, Kayyem said.
Not everyone is happy about the decision. One tenant, who asked not to be identified, complained that High Street has not developed as promised and that amenities available at other high-end apartments have not been offered at CityNorth.
Another tenant, Matt Taylor, said his renewal is several months off but called the loss of the concession "standard procedure for most apartment complexes."
"I definitely still get value out of living here," he said. "Of course, you miss out on the stores and businesses that are yet to come, but that should be obvious to anyone who moves into a development that isn't finished yet. I wasn't promised any amenities that aren't here now."
He said he works from home and appreciates nearby conveniences "so I am still very happy here."
Rents going up at CityNorth
Sunday, April 4, 2010
CityNorth foreclosure sale postponed until June
CityNorth foreclosure sale postponed until June
by Michael Clancy The Arizona Republic Mar. 30, 2010 01:49 PM
A foreclosure sale of CityNorth's High Street that was scheduled for Wednesday was postponed at the last minute.
The sale now will take place on June 2.
The sale was postponed at the request of the lender, Capmark Financial. Capmark, which is in bankruptcy, filed foreclosure against the owners of CityNorth in late December.
The CityNorth group, which includes the Klutznick Co. and Related Urban Development, owes more than $290 million to Capmark.
No reason was given for the postponement.
High Street, the initial phase of the 144-acre project at 56th Street and Loop 101 in northeast Phoenix, opened in November 2008. Subsequent phases were supposed to open annually, but the economic slump put an end to those plans.
High Street includes apartments, offices, restaurants and retail.
Currently, future work at CityNorth is on hold, pending financing for new phases.
by Michael Clancy The Arizona Republic Mar. 30, 2010 01:49 PM
A foreclosure sale of CityNorth's High Street that was scheduled for Wednesday was postponed at the last minute.
The sale now will take place on June 2.
The sale was postponed at the request of the lender, Capmark Financial. Capmark, which is in bankruptcy, filed foreclosure against the owners of CityNorth in late December.
The CityNorth group, which includes the Klutznick Co. and Related Urban Development, owes more than $290 million to Capmark.
No reason was given for the postponement.
High Street, the initial phase of the 144-acre project at 56th Street and Loop 101 in northeast Phoenix, opened in November 2008. Subsequent phases were supposed to open annually, but the economic slump put an end to those plans.
High Street includes apartments, offices, restaurants and retail.
Currently, future work at CityNorth is on hold, pending financing for new phases.
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