Tag Archives: development

Jeff Roberts Opus West

Jeff Roberts – Vice President Of Real Estate Development At Opus West

About 10 years after its Phoenix headquarters opened in 1979, Opus West came up against a major recession in the Valley. It survived that test and is weathering today’s economic downturn with the same tactics.

A division of the Minneapolis-based Opus Group real estate development company, Opus West is going head-to-head with Arizona’s moribund economy with its corporate structure, diverse product base and a development philosophy that has served it well.

“We are vertically integrated and that allows us to react quickly in good times and bad,” says Jeff Roberts, vice president of real estate development.

Opus West has in-house property management, construction, design and development services. Presently, the company’s design-build staff is opening new revenue streams by offering its services to outside clients, such as corporations and governments.

The company still looks for opportunities and is more likely to find them within its broad line of products — retail, industrial, office and residential, including condos, apartments and senior housing.

As part of its approach to development, Opus West does not hinder its flexibility with a sizeable property portfolio and keeps its land inventory low, Roberts says.

“In the late ’80s and early ’90s (recession), many companies accumulated a large portfolio and were much more affected, while we had built our buildings and sold them for a profit,” he says. “That makes us much less subject to market cycles.”

In these tough times, Opus West is again focused on finishing existing projects to get new tenants moved in, taking care of existing tenants and keeping the door open to build-to-suit projects for tenants that are willing to commit, Roberts says. Projects on its plate include the 263,000-square-foot mixed-use Tempe Gateway building in downtown Tempe and the 170,000-square-foot Mill Crossing shopping center in Chandler.

One bit of good news Roberts sees in today’s economy is a “reasonably strong amount of large tenant activity” as companies move for economic reasons or to take advantage of a down market and upgrade to nicer space. Roberts expects little new construction in 2009.

“I don’t look at it as a year where there will be any major projects,” he says. “It will be a year of people working through leasing up what they’ve got and, hopefully, a year we hit bottom and see things heading back up. The big question is whether the economy picks up enough where we can get some significant net absorption.”

Roberts has more than 17 years of real estate experience in eight different cities. Prior to joining Opus West, he was an asset manager for Beta West in Denver. Roberts holds a bachelor of science degree in real estate from Arizona State University.

www.opuscorp.com

Bob McGee Southwestern Business Financing Corporation

Bob McGee – President And CEO, Southwestern Business Financing Corporation

Fourth generation banker Bob McGee, president and CEO of Southwestern Business Financing Corporation, sees a rough year ahead for small businesses in Arizona. When McGee says rough, he means rough compared to Arizona’s customary booming economy.

“We may only have 2 to 3 percent growth in the state, but as long as we have water and electricity to run air conditioners, people are going to keep moving here from Chicago and Minnesota,” he says. “Yes, businesses are going to have a tough time, but I still do not think it will be anywhere near as bad as the past couple of bad times we’ve been through.”

McGee, whose firm is a nonprofit Certified Development Company approved by the Small Business Administration to make low-risk 504 loans for fixed-asset projects, says the downturn has hit home. Southwestern loaned $90 million for projects in 2007, but SBA approvals are down 40 percent, while the actual loans he funded are off by 10 percent.

Surprisingly, McGee sees small businesses becoming more attractive in today’s economy.

“When times get tough, that’s when people start thinking about owning their own business,” McGee says.

Businesses with fewer than 20 employees comprise more than 90 percent of Arizona’s economic landscape, but they provide more than jobs.

“It’s the way people achieve a dream,” McGee says, “because many people are happy in their job, but their real dream is to own their own business and be their own boss.”

During his career with Southwestern, McGee has helped create more than 7,000 jobs through the funding of SBA 504 loans. Since its founding in 1981, the company has funded the purchase or construction of more than $1.4 billion of buildings for businesses. Most of his deals involve construction, which today is funded by a commercial bank.

“I don’t fund until the building is finished,” McGee says.

McGee cites three factors for current market conditions. One is a complete lack of secondary financing, as potential investors poured $4 trillionintomoney markets.

“That puts a crimp in my kind of lending, and more important, the banks I work with,” McGee says.

A second factor is that banks are reluctant to make any loans, and the third reason, he says, is that a large percentage of business owners considering the purchase of a building are “terrified” by what they see on the evening news and are waiting for the market to hit bottom.

“You can’t out-time the market,” McGee says. “The way I know when it bottoms is I look back a year later and say, ‘Oh, that’s where it was.’ ”

www.swbfc.com

Mr.WestValley

John F. Long Didn’t Just Build Houses In The West Valley, He Also Built A Community

About the only person who would disagree about calling the late John F. Long the father of the West Valley would be John F. Long. For more than 60 years, the man described by friends and colleagues as quiet and unassuming, held the vision that transformed the West Valley from fields to thousands of homes for soldiers returning from World War II to emerging cities.

The legacy of John F. Long will live forever,” says Jack Lunsford, president and CEO of WESTMARC. “Unlike footprints in the beach sand, which are eventually washed away, John’s are cast in concrete. And that doesn’t just mean buildings. He left us foresight and philanthropy, all with humility and without fanfare, simply because he loved the area, he loved people, and he wanted to make the West Valley a great place for families to live.”

Long died in February at the age of 87, but his legacy in the West Valley — indeed the entire Valley — will live on, not just in the communities he built, but also in the people whose lives he touched.

“His vision and reality of building a master-planned community is certainly important,” says his son, Jacob Long, who is chief operating officer for the company his father founded, John F. Long Properties. “Not only was he providing an affordable place to live for so many, he was also providing jobs for so many people. A lot of those people not only stayed here, but they are an integral part of helping the West Valley grow as business and community leaders. At least once a week I meet someone who says, ‘Because of your father, my family or I was able to buy a solid home at a great price. It helped me build equity.’ ”

A Phoenix native, John Long got his start in the building industry with a G.I. loan, his own hammer and other tools he borrowed from his stepfather. He first set out to build a home for his new wife, Mary. Instead, he ended up selling the home for twice what it cost to build.

By 1954, John Long was thinking big. He set out not only to build a collection of tract homes in one area, but also to create a community with schools, churches, hospitals, shopping centers and parks. Long created the state’s first master-planned community and named it Maryvale, after his wife.

By applying mass production techniques to homebuilding, Long was able to offer a three-bedroom, two-bath house with a swimming pool for less than $10,000. Houses began selling at a rate of 100 per week, and John F. Long Properties was born.

Despite his success, Long never forgot who he was building the homes for, says Diane McCarthy, director of business partnerships and legislative affairs for West-MEC. For example, when Long first began constructing homes, he realized the VA loans didn’t cover such essentials as refrigerators and stoves. So Long trekked to Washington, D.C., and went before Congress to change the scope of the VA loans.

“He didn’t do it to make money. Making money was a sidebar to what he was doing,” McCarthy says. “He wanted to build communities. He knew with all those returning servicemen after World War II who had served out here either at Williams or Luke, he knew they were going to come West and he wanted an affordable place for them to live.”

Already hailed as an innovator for his assembly line methods of homebuilding, Long adopted sustainable methods years before it became popular. In 1988, John F. Long Homes was chosen by the U.S. Department of Energy to develop, construct and test a demonstration model home featuring roof-mounted photovoltaic solar cells. His Solar One became the world’s first solar subdivision. The 24-home subdivision in Glendale has almost all of its power needs met by ground-mounted photovoltaic cells.

“I think John was probably one of the greatest entrepreneurs and innovators, at least in the housing end, in water conservation, in just general development,” says Rep. John Nelson, (R-Phoenix). “He was a step ahead of everybody in those areas.”

John F. LongFor Long, finding new ways to build homes was just one part of his vision. He was interested in building a community; more specifically, he wanted the West Valley to be a place where people lived and worked. Rather than resent the fact that the West Valley was perpetually in the East Valley’s shadow, Long took the East Valley model and used it to reshape the West Valley. To that end, WESTMARC was born

“WESTMARC wouldn’t have happened without him. It’s just that simple,” says McCarthy, who first met Long in 1992, when she became the first director of WESTMARC. “He provided a lot of the seed money for us to get started, and in addition to the money, he talked to a lot of people. When you’re starting up an organization like that, you don’t have a lot of credibility because you don’t have a track record. He was willing to talk to other people and say, ‘Look, I really believe in what this organization can do and we have to give it a chance. And we all have to be willing to roll up our sleeves and get involved and help make a lot of these things happen.’ ”

Making things happen was a John Long specialty. He was always quick to donate money, land or services to make sure his beloved West Valley would continue to grow and be a place where people could raise families and build communities. A very small portion of what he gave includes the labor and material to fill potholes on 550 miles of West Phoenix streets; building and donating 21 townhouses to the city’s Affordable Housing Program; and when the Milwaukee Brewers were looking for a new Spring Training home, donating 60 acres of land for the Maryvale Baseball Park – as well as lending the city $10 million for construction.

Besides giving out of his own pocket, Long made sure others with the wherewithal gave as well.

“Dad was born and raised in Phoenix,” Jacob Long says. “This makes a huge difference. You have that sense of ownership and pride. He always was looking for ways to help others help themselves, who in turn might have the same feelings and be inspired. That is how true communities flourish.”

John Long had a standing challenge to other developers who built in the West Valley, Nelson says.

“He’d say, ‘I’ll do this if you do that,’ ” Nelson adds. “If you took a look at the developers who took a project on the West Side, they always had that challenge with John to put a project in pace that had benefits for those who lived there.”

McCarthy recalls a time when the library and senior center just north of Indian School Road and 51st Avenue badly needed repairs. Long made sure money for the upgrades was included in a bond measure. The measure succeeded, but when he found out the renovations weren’t scheduled until years later, Long took matters into his own hands.

“He went to the city and said, ‘Here’s the check for $10 million. Get it done sooner and pay me when the bond proceeds come in,’ ” McCarthy says. “So that beautiful, beautiful library and senior center he lived to see done.”

Exactly how much Long gave to the community is not exactly known, as most of his work was done behind the scenes and with no fanfare.

“Both parents instilled in us the need to be aware of someone who truly needs help and is experiencing a tough time through no fault of their own,” Jacob Long says. “One such person, a teenager, experienced a very bad athletic accident. He was confined to a wheelchair and his parents didn’t have the resources to modify their home. Dad read about this in the newspaper and he contacted the family and offered to remodel their home to accommodate the son’s special needs. This way he could be with his family. No one asked (my Dad) to do this.”

His philanthropy was not a recent development. In fact, he established the John F. Long Foundation, a nonprofit group supporting local charities, schools, education events and general community needs, in 1959. Long was generous in the extreme, but he was still a businessman and he would fight to protect his interests and those of the community he loved.

“He had a heart of gold and was tough as nails when he had to be,” Nelson says. “John sued the living daylights out of the city of Phoenix (in 1986) because they sold water to Palo Verde (Nuclear Generating Station). That was another side of John; he was not afraid to fight. If he felt he was right, he’d drag you to court. He didn’t care who you were.”

In 2000, WESTMARC created a lifetime achievement award and named it after Long. Despite all of his years working for the West Valley, the honor came as a surprise to him, McCarthy says.

“We told him we named it after him and I had never seen him speechless up to that point,” she says. “He was so thrilled at that. And then every year, I would take a couple of names to him and ask him, ‘Who do you think should get it?’ And he’d pick out the one and say, ‘That’s the one.’

“He never, ever flaunted anything. He was the most humble person. He would walk into a room and quietly sit down and unless you knew John Long, you wouldn’t know it was him,” McCarthy says. “I miss him. He was always somebody to call if you had an idea and he was willing to call you if he had an idea. And that’s how things get done.”

FutureShock

State Leaders Prepare The Copper State For Explosive Growth

An official letter from the state’s Lawn and Pool Use Enforcement Division says you must choose between taking out your green lawn or draining your swimming pool. You can’t have both, as the state has been severely restricting outdoor water use ever since the population of Central and Southern Arizona swelled to 10 million people around 2040.

You opt to keep the pool because urban sprawl and the heat-island effect have caused Arizona to break yet another record — the number of summer days when the temperature fails to drop below 100 degrees.

But time in the pool is getting rarer. Your daily commute from Pinal County to Phoenix is a grinding two hours. You’d like to work closer to home, but job centers and transportation routes haven’t reached your relatively new subdivision.

Welcome to the Sun Corridor, circa 2050.

With foresight, unified planning and a significant investment in the state’s infrastructure, the above scenario need not play out.

Without it, according to the author of a recent report on Arizona’s future, a part of the state risks becoming, not the next Los Angeles, but its bland sister — the San Fernando Valley.

“You’ll essentially get existing urban development patterns spread all over the place in a seamless, homogenous, urban fabric of chain stores, fast food restaurants and red stucco houses,” says Grady Gammage Jr., a principle author of “Megapolitan — Arizona’s Sun Corridor,” published by Arizona State University’s Morrison Institute for Public Policy.

The report predicts that land stretching from the middle of Yavapai County to western Cochise County to the Mexican border will someday merge into one integrated super metropolitan area — a “megapolitan” dubbed the Sun Corridor.

That doesn’t mean there will be uninterrupted development between Prescott and Tucson — there is too much Indian and federal land in the way. Instead, the corridor’s economies and commuting patterns will merge.

Imagine a series of overlapping circles emanating from Pima, Pinal and Maricopa counties. According to a measurement developed by scholars at the Metropolitan Institute at Virginia Tech, if at least 15 percent of workers from one area commute to another, those commuting patterns have merged.

Already, Pinal County sends 40 percent of its workers into other regions, most likely north to Maricopa County.

“That means Maricopa and Pinal are already merged,” Gammage says.

Some time between 2010 and 2020, Pinal is expected to send more than 15 percent of its workers south to Pima County, Gammage adds, creating an economic bridge between Phoenix and Tucson.

The U.S. Census designates these areas with cross-region commuting patterns as “combined statistical areas,” something the “Megapolitan” report says may happen by the 2020 decennial census.

The Sun Corridor will be one of 10 megapolitan areas in the United States. By 2030, it could be home to 10 million people and 4.5 million jobs, making it a potential hotbed of wealth and productivity. According to the report, the nation’s office market and high-tech clusters are in megapolitans.

However, as the Morrison Institute report asks, will Arizona be able to harness the staggering potential of such an area?

That would require a whole new level of dialogue and cooperation between the five councils of government, six counties, 57 municipalities and 300 other governmental units spanning the 30,000-square-mile area that would make up the Sun Corridor.

And the state is just at the beginning of that process, Gammage says, adding, “We’re behind the curve.”

Shannon Scutari, on the other hand, believes she sees progress every day.

As Gov. Janet Napolitano’s policy advisor for growth and infrastructure, Scutari is on the front lines of important growth initiatives, including the long-term planning exercise developed by the Urban Land Institute, AZ One – A Reality Check for Arizona, held last spring at the Phoenix Convention Center.

Statistics from the Morrison Institute

AZ One assembled more than 300 people from Maricopa and Pinal counties and guided them through alternative growth scenarios with the purpose of generating discussion and consensus.

“They’re talking to each other, there’s no doubt about it,” Scutari says of the disparate public and civic leaders she encounters in her job. “Some of them are actually even listening to each other.”

Scutari adds that the governor hopes to see the AZ One exercise duplicated in the Tucson and Flagstaff areas.

While her office is trying to bring several growth issues into sharp relief, Scutari says a pressing challenge is the state’s need to invest in transportation infrastructure.

That is why the Arizona Department of Transportation has begun a $7 million statewide study and is working with cities, tribal governments, land-use planners, regional transportation organizations and others to assess the state’s infrastructure.

One important feature of the Statewide Transportation Planning Framework, Scutari says, will be to connect land-use decisions with transportation infrastructure, some


thing that has never been done. The study already has outlined some of the most critical transportation needs.

Right now, the governor is backing an initiative campaign to put on the November ballot a one-cent increase in the state’s sales tax. The increase would raise $42 billion over 30 years to pay for transportation infrastructure.

The money is needed as Arizona’s roads and freeways are “only going to get worse in the next 25 years,” warns Tim James, director of research and consulting for ASU’s L. William Seidman Research Institute.

James headed a team that spent a year studying the state’s infrastructure and its ability to handle growth. The resulting report did not endorse the Napolitano-backed initiative, but it did say that without changes in funding mechanisms, the state cannot keep up with growth.

“There will be longer commutes, there will be more time spent in traffic, you’ll be traveling at lower speeds,” James says. “It’s going to be more congestion and less safe journeys. The road system is going to become unacceptably poor.”

The report, commissioned by the Arizona Investment Council, formerly known as the Arizona Utility Investors Association, concluded that accommodating growth is going to be “very, very costly” — probably $417 billion to $532 billion in the next 25 years.

In that time period:

  • Electricity demand will increase by about 85 percent, yet the state faces a funding gap in paying for new plants.
  • Just providing telecommunications services to the state’s current unserved population would cost up to $2 billion. Creating a state-of-the-art fiber network that would guarantee high quality telecommunications would cost about 10 times that.
  • Water delivery and treatment systems built decades ago will need to be replaced.

While it is impossible to predict exactly what the Sun Corridor will look like in 2040, planners do know generally where growth will occur.

Eric Anderson, transportation director for the Maricopa Association of Governments, says projections show most growth in Maricopa County will be in the West Valley as developable land in the east diminishes. Pinal County, where it meets the southeast corner of Maricopa County southeast of Queen Creek and the 275-acre state land parcel dubbed Superstition Vistas, will see a lot of growth as well. Finally, Anderson says, areas around Casa Grande and Maricopa will continue to expand.

According to MAG’s latest figures, there are about 1.8 million housing units already approved or entitled in various master-planned communities in Maricopa and Pinal counties.

Jay Hicks, co-chairman of the AZ One steering committee and a vice president at EDAW Inc., an architecture and environment consulting company, says people still can shape the character of future development, even in the face of all that entitled land.

Some parcels may need to be re-entitled as time passes and communities become more cognizant of the way land uses affect pollution levels and energy consumption.

Additionally, 40 to 50 percent of all commercial properties will need to be redeveloped in the next 15 to 20 years, Hick says.

Facing the challenges that come with growth seems daunting, but Scutari says there is “a sense ofoptimism” among the state’s stakeholders.

As Gammage put it: “There is an opportunity here, if we can seize it and get ahead of it, we can do something really special.”

Two new spring training stadiums

Two New Spring Training Stadiums Set To Debut In The West Valley

With football, hockey, baseball and possibly USA Basketball joining the mix, the West Valley is becoming an active sports mecca for the rest of the Valley. Recent additions to this bustling hub of game activity are new Cactus League training facilities in Glendale and Goodyear that will come online for the 2009 spring training season.

This year, the Cactus League set a record when 1.3 million fans (60 percent from out of state) attended spring training games. The Cactus League’s contribution to the state’s economy is more than $200 million a year.
“Spring training is a big draw and a great experience,” says J.P. de la Montaigne, Cactus League president. “We call it our Super Bowl every year.”

Glendale’s new facility will be the spring training complex for the Los Angeles Dodgers and Chicago White Sox. The state-of-the-art baseball stadium will have seating for 13,000, four major league practice fields, eight minor league practice fields, two practice infields and 118,000 square feet of major and minor league clubhouses for the two teams. Down the road, the 151-acre site will also have residential, restaurant and retail development, a four-star hotel and an 18-hole golf course developed by Rightpath Limited Development Group.

The Arizona Sports & Tourism Authority is funding two-thirds of the complex, and the city of Glendale is contributing one-third of the $90 million project, which is under construction on 111th Avenue west of the Loop 101 between Camelback Road and Glendale Avenue. Stadium construction started in November 2007 and will be finished in time for the 2009 spring training season.

Tom Harrison, construction executive for Mortenson Sports, a division of Mortenson Construction which is building the complex, says planning the facility took longer than anticipated, so they added a night shift in August to keep construction on schedule.

“This is an exciting project and we have the right team to get it accomplished on time,” Harrison says. “I’ve been involved in five other spring training facilities in the Valley, but this is truly the most unique. The Glendale facility will be more than just a place to watch the game.”

Harrison says the Glendale stadium will have a 1,400-foot-long lake as part of the facility. The lake will have an aesthetic function as well as serve as the irrigation source for the lush landscaping that will create a park-like setting at the stadium.

“This is not going to be a standard practice area,” Harrison says. “It’s going to be an aesthetically pleasing setting with benches so fans can enjoy their surroundings.”

Based on a 2006 economic impact study conducted by Economic Research Associates for the city of Glendale, the economic impact of moving the Dodgers and White Sox to Glendale could be as much as $19 million per year for the region.

“The new spring training facility fits well in our sports and entertainment district,” says Jennifer Liewer, senior marketing and communications manager for the city of Glendale. “The Dodgers and White Sox want to make this something that will last and be part of the community, so we know that when they get to Glendale it will become their home as well.”

The Cleveland Indians and Cincinnati Reds will play at the Goodyear Ballpark, which will be located on a 3-acre parcel south of Yuma Road and east of Estrella Parkway. The ballpark will open in March 2009 for spring training for the Indians. The Cincinnati Reds will move their spring training operations to Arizona in 2010.

HOK Sport of Kansas City designed the baseball complex, which will have 8,000 lower-bowl fixed seats, 500 premium seats, 1,400 berm seats, six luxury suites, 3,000 parking spaces, and a state-of-the-art scoreboard and public address system. It will also have two group event areas: an outfield pavilion and bar with berm seating for 400 and a third-floor party deck behind home plate that will hold 150 people. Barton Marlow, a national construction services company out of Michigan, is building the ballpark complex.

The Goodyear Recreational Sports Complex, which will house the Cleveland Indians’ clubhouse/player development facility and two practice fields, is under construction on a 52-acre site east of Estrella Parkway about a half-mile south of the Goodyear Ballpark. It will be completed this month, at which time the Indians will begin using it. The Indians will use the clubhouse and two practice fields year-round. Besides the clubhouse, the Goodyear Recreational Sports Complex has six full-baseball practice fields, two half-baseball practice fields, a 36,000 square foot agility field, six covered practice batting cages and tunnels, three open practice minor league batting tunnels, six pitching mounds for the major league and six for minor league, an observation tower for the major league fields and a scoreboard.

Goodyear citizens approved a bond election in 2004 for $10 million to help build the recreational sports fields, so the city will be able to use the four minor league fields 10 months of the year. Regis Reed, Goodyear’s senior project manager, says the city plans to use the fields for city events, youth programsand high school tournaments since the fields are lighted to high school standards.

Ticket prices at the Goodyear Ballpark will be comparable to other Cactus League facilities, which are $8 for a lawn seat and up to $27 for a club or premium seat.

Nathan Torres, stadium manager for the Goodyear Recreational Sports Complex, says that based on a 2007 Cactus League survey, the economic impact of the Cleveland Indians moving to Arizona in 2009 will be more than $23 million. That number will grow to more than $47 million when the Cincinnati Reds are introduced in 2010.

ForeclosureFallout

As More People Lose Their Homes, Banks Are Left Holding The Keys

Acquiring real estate through foreclosures is not exactly the type of transaction banks relish. That’s especially true in a down market that is overloaded with raw land and homes — and a paucity of potential buyers.

Estimates of the amount and value of acquired real estate through foreclosures are difficult, if not impossible, to come by, an industry insider says. A lot of the banks don’t want to talk about it.

“It’s ugly for everyone involved and you can’t even get the Federal Reserve to talk about it,” the insider says.

Anthony B. Sanders, professor of finance and real estate at Arizona State University’s W. P. Carey School of Business, sums up the somewhat dismal situation: “Banks are not in the business of being portfolio managers, either vacant land or housing.

“The way they’re trying to get rid of properties is that most banks are doing packaging. They sell packages of defaulted properties to investors around the United States,” he continues. “They started with national lenders, but there was very little interest in that. Then they went to regional packaging. That didn’t work either. Let’s face it, nobody really wants a Detroit-area loan or housing package.”

What’s happening is that hedge funds and equity funds are looking for very specific types of properties. Raw land value is highly dependent on where the land is.

“That’s why they don’t want to buy large portfolios,” Sanders says. “Because on the urban fringe, when you get way out west or southeast of Phoenix, some of that land they cannot literally give away. The reason is there is no foreseeable development going on in those areas.

“They’re looking for anything related to water rights or mineral rights — anything with natural resource implications still has a positive value,” Sanders says.

Until housing makes a comeback, banks are not finding a lot of interest in 40-acre tracts of desert that someday could be converted into a housing development, Sanders says. Some banks have defaulted single-family homes, often in remote areas.

“During the boom, and until fairly recently, a lot of starter homes were built in areas near Queen Creek, where land prices were fairly inexpensive for the Phoenix market,” Sanders says. “That market has really gotten beaten up pretty hard.”

National and regional bidders for those packages are few and far between.

“It brings back the old adage of location, location, location,” Sanders says. “If you’re planning properties located on major golf courses, or some properties in Scottsdale, there’s interest in that. In the classic subprime neighborhoods, which tend to be lower income, there’s not a lot of interest.”

In the meantime, banks are running around trying to peddle their packages. It’s more feasible to sell packages instead of marketing individual properties, because bank real estate portfolios are overflowing.

“Packages provide a good indication of which areas of Phoenix are likely to keep dropping like a rock,” Sanders says. “It’s those areas where there isn’t any interest in bank packages, which means the market doesn’t think they’re near the bottom. In some areas of Phoenix, the bottom may be a little ways away.”

With packaging of perhaps as many as 200 properties at a time, come discounts.

“The nasty part is that some of these properties are being offered at a big discount and they still can’t get rid of them,” Sanders says.

Even so, there continues to be interest in Ahwatukee, Scottsdale and Paradise Valley, which Sanders says means the housing market is showing some signs of life. But he adds this ominous observation.

“This is very reminiscent of the RTC (Resolution Trust Corporation) fiasco after the savings-and-loan debacle. It’s just like when the RTC was putting together packages. That’s the tipoff. Anytime you see packaging, that should make the hairs stand up on the back of your neck.”

At the Arizona Department of Financial Institutions, which regulates state-chartered banks and none of the large national ones, Tom Wood, division manager for banks, also recalls the S&L collapse.

“We had a lot of raw land in the 1980s,” he says. “Thank goodness we don’t have much of that now.”

Most of the real estate banks are trying to get rid of consists of single-family homes, Wood says.

“Very rarely do we see raw land,” he says. “Some banks don’t want to own it because it takes longer to get rid of. If they foreclose on raw land, they probably sell it at a sheriff’s sale.”

Wood expects a continued uptick in bank acquisitions of real estate, but sees very little of that among state-chartered banks. He suggests that some larger banks might be bundling foreclosed properties and attempting to dispose of their holdings through auctions or developers.

Depending on which economist you talk to, a substantial housing turnaround won’t happen until 2010. Some say 2009; and yet, as Sanders says, there are signs of life in 2008.

“For certain areas, recovery is there,” Sanders says, “but if I’m sitting in Buckeye, Avondale, Queen Creek and parts of Gilbert, I wouldn’t look for a speedy return.”