Toll Brothers outbid three other homebuilders for the parcel, including Shea Homes, Morrison Homes and Standard Pacific. The bid shatters the previous record for the highest bid for state trust land, which was set last by military insurer USAA when it paid $40 million for a 575-acre parcel in north Phoenix near Interstate 17.
The 536-acre parcel is in the master-planned community of Desert Ridge, which sits just north of the Loop 101, south of Pinnacle Peak Road, north of the Central Arizona Project canal, and bisected by Tatum Boulevard. Desert Ridge, a 5,700-acre community with more than 2,200 homes and an increasingly thriving commercial component, is one of the most successful developments in the past few years. Late last year, Marriott began work on a 950-room resort there, which will be the state's largest when completed in 2002, and Vestar Development is developing a 1.2 million-sf retail center called Desert Ridge Market.
In the late 1990s, there was significant activity in the commercial section of the development. The Mayo Clinic moved its hospital out of Scottsdale and onto a parcel in Desert Ridge, and Sumitomo Sitix built a silicon-wafer manufacturing plant not far away. Earlier this year, American Express began development on a 90-acre campus that will consolidate a number of its disparate operations in the Valley.
The sale of the land ameliorates fears about drainage on the residential land in Desert Ridge. New home building was halted in the past few years above the Central Arizona Project canal by the US Army Corp. of Engineers, which was examining the drainage issues on the parcel. The relatively flat parcel is just west of the McDowell Mountain Range and receives substantial runoff during times of heavy rains.
The moratorium on home building has created pent-up demand from homebuilders.
Toll Brothers plans to build no more than 2,200 semi-custom homes on the site, with starting prices in the high $200,000s.
Proceeds from the sale of state trust land are earmarked for Arizona's public schools fund.
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