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HomeMy WebLinkAboutCouncil Presentation 03/05/2021- Land AdvisorsMarch 5, 2020 Town of Marana Retreat Land Advisors Organization © 2020 All Rights Reserved While Land Advisors Organization makes every effort to provide accurate and complete information, there is no warranty, express or implied as to the accuracy, reliability or completeness of furnish data. Land Advisors Tucson Background LAO Tucson represents 80% Marana Market share Over 70% Market Share of Current and Future (20,000+) Residential Lots Throughout the Tucson Metro Area Responsible for Largest Homebuilder Sales in the Past Decade Representation of Tucson’s Top Master-Planned Communities February marked the Tucson office 20th year anniversary 6,000 acres in the North Marana Area Tucson Metro Market Snapshot Land Advisors Organization © 2020 All Rights Reserved While Land Advisors Organization makes every effort to provide accurate and complete information, there is no warranty, express or implied as to the accuracy, reliability or completeness of furnish data. Market Snapshot 2020 Recap o Lots Purchased 4,035 (Problem is we permitted 4,300) o 936 purchase 1H o 3,099 purchased 2H (76%) o Total Volume 2020 $185,117,000 up 40% over 2019 o Gladden Farms most active, lots sold 405 and 800 ordered o Finished lot prices up 20-25% across the board in 2020 o Huge demand-3x more lot orders than expected o 50% of all lots came from MPC’s, 75% in 2021 Going Forward 2021 and beyond o Easy deals 3,500 lots by July 1 (3,000 already controlled) o 3,000-6,000 lots can be available late 2021 into 2022* o 2-3 builders will look to buy 1,000 lots or more to grow o 12,000 lots available to supply into 2022. Not going to be enough Land Advisors Organization © 2020 All Rights Reserved While Land Advisors Organization makes every effort to provide accurate and complete information, there is no warranty, express or implied as to the accuracy, reliability or completeness of furnish data. Marana Snapshot 2020 Recap o Lots Purchased 1,054, over 20% of the Tucson market o 88 purchased 1H o 966 purchased 2H (91%) o Marana market share should advance to over 40% in 2021 o 564 lots were purchased in North Marana o Estimate of 3,000 lots to be purchased in Marana 2021 o Average Marana project sales price o North Marana $314,000 o Saguaro Bloom $319,000 o Dove Mountain $528,000 o Average per acre price of the farm ground investor $40k/ AC, Builders paying $110k o Average finished lot price $1,500 FFF up 30% from 2020 Land Advisors Organization © 2020 All Rights Reserved While Land Advisors Organization makes every effort to provide accurate and complete information, there is no warranty, express or implied as to the accuracy, reliability or completeness of furnish data. Estimated Monthly Payment excluding (PMI, Tax, Insurance, HOA) Interest Rate Monthly Payment Buying Power 11/6/2018 5.09%$1,600.00 $295,000 3/20/2020 4.11%$1,601.31 $331,000 3/3/2021 3.14%$1,600.89 $373,000 ±$78,000 increase in buying power Home Buying Power Tucson Metro Trends Land Advisors Organization © 2020 All Rights Reserved While Land Advisors Organization makes every effort to provide accurate and complete information, there is no warranty, express or implied as to the accuracy, reliability or completeness of furnish data. Annual Permits 4,882 5,274 5,363 6,547 7,241 7,172 6,867 7,493 8,511 9,560 11,762 8,579 5,098 3,018 2,077 1,865 1,438 2,040 2,250 2,284 2,176 2,6973,150 3,495 3,697 4,350 4,600 0 2,000 4,000 6,000 8,000 10,000 12,000 14,000 Overproduction Recession Recession Underproduction E. 2021 Permits: 4,600 Land Advisors Organization © 2020 All Rights Reserved While Land Advisors Organization makes every effort to provide accurate and complete information, there is no warranty, express or implied as to the accuracy, reliability or completeness of furnish data. Future Permit Projection Scenarios FINISHED LOTS REQUIRED 34,550 25,600 16,250 Land Advisors Organization © 2020 All Rights Reserved While Land Advisors Organization makes every effort to provide accurate and complete information, there is no warranty, express or implied as to the accuracy, reliability or completeness of furnish data. Annual lots purchased vs lots permitted 400 1,226 1,484 1,202 1,341 1,074 2,437 1,797 2,334 4,035 1,438 2,040 2,250 2,284 2,176 2,699 3,150 3,495 3,697 4,336 4,600 0 1,000 2,000 3,000 4,000 5,000 6,000 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 E. 2021 2022 2023 2024 Lots Purchased Permits Land Advisors Organization © 2020 All Rights Reserved While Land Advisors Organization makes every effort to provide accurate and complete information, there is no warranty, express or implied as to the accuracy, reliability or completeness of furnish data. Metro Weekly Permits COVID-19 Lockdown 73 92 7172 89 5563 115 81 92 6471 4138 49 535158 81 101 41 122 75 9091 134 77 62 104 116 101 68 82 100 90 112 69 90 77 93101 106 102 113 96 73 112 46 93 122 87 4338 0 20 40 60 80 100 120 140 160 Land Advisors Organization © 2020 All Rights Reserved While Land Advisors Organization makes every effort to provide accurate and complete information, there is no warranty, express or implied as to the accuracy, reliability or completeness of furnish data. Marana Monthly Permits 2020 75 80 85 35 58 111 102 82 73 82 63 59 0 20 40 60 80 100 120 Land Advisors Organization © 2020 All Rights Reserved While Land Advisors Organization makes every effort to provide accurate and complete information, there is no warranty, express or implied as to the accuracy, reliability or completeness of furnish data. Annual Community Counts (Communities >30 Lots) 103 154 149 97 87 89 83 66 72 81 48 69 77 67 79 64 39 0 20 40 60 80 100 120 140 160 180 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Land Advisors Organization © 2020 All Rights Reserved While Land Advisors Organization makes every effort to provide accurate and complete information, there is no warranty, express or implied as to the accuracy, reliability or completeness of furnish data. Development Timeline Total ±39 Months YEAR 3YEAR 2YEAR 1 March 2022 ±12 Months Zoning Completed Platting Begins March 2022 June 2024 3 Months Active Community Completion of Lot Development March 2024 ±12 Months Raw Land March 2021 Platting Completed March 2023 ±12 Months Lot Development Begins March 2024 March 2021 Start Zoning Development 101 Land Advisors Organization © 2020 All Rights Reserved While Land Advisors Organization makes every effort to provide accurate and complete information, there is no warranty, express or implied as to the accuracy, reliability or completeness of furnish data. Cost –Finished Lot Value Assuming a 50’ Lot $42,500$45,000$48,750$50,000$53,750$58,450$62,500$65,000$35,000 $37,500 $40,000 $42,500 $45,000 $47,500 $50,000 $52,500 $55,000 $57,500 $60,000 $62,500 $65,000 $67,500 $70,000 2014 2015 2016 2017 2018 2019 Est 2020 Est 2021 Land Advisors Organization © 2020 All Rights Reserved While Land Advisors Organization makes every effort to provide accurate and complete information, there is no warranty, express or implied as to the accuracy, reliability or completeness of furnish data. Cost -Lot Development Assuming a 50’ Lot$23,750$25,000$26,250$30,000$36,250$40,000$42,000$42,000$15,000 $17,500 $20,000 $22,500 $25,000 $27,500 $30,000 $32,500 $35,000 $37,500 $40,000 $42,500 $45,000 $47,500 $50,000 2014 2015 2016 2017 2018 2019 Est 2020 Est 2021 Land Advisors Organization © 2020 All Rights Reserved While Land Advisors Organization makes every effort to provide accurate and complete information, there is no warranty, express or implied as to the accuracy, reliability or completeness of furnish data. 5 Year Lot Residual Difference for 50’ lot 2021 $1,300 FF $800 FF Horizontal Development $125 FF Spine Road $375 FF Land Residual ($18,750/lot) $65,625 per acre* 2016 $1,150 FF $500 FF Horizontal Development $100 FF Spine Road $550 FF Land Residual ($27,500/lot) $96,250 per acre* Difference of $30,625 per Acre*Every $50 per FF development goes up it decreases land residual $8,750 per Acre. North Marana Activity Active MPC Map Land Advisors Organization © 2020 All Rights Reserved While Land Advisors Organization makes every effort to provide accurate and complete information, there is no warranty, express or implied as to the accuracy, reliability or completeness of furnish data. Land Advisors Organization © 2020 All Rights Reserved While Land Advisors Organization makes every effort to provide accurate and complete information, there is no warranty, express or implied as to the accuracy, reliability or completeness of furnish data. Gov. Land State Trust Land Advisors Organization © 2020 All Rights Reserved While Land Advisors Organization makes every effort to provide accurate and complete information, there is no warranty, express or implied as to the accuracy, reliability or completeness of furnish data. Gov. Land State Trust 1-3 years Forecast Development 1-3 Years Land Advisors Organization © 2020 All Rights Reserved While Land Advisors Organization makes every effort to provide accurate and complete information, there is no warranty, express or implied as to the accuracy, reliability or completeness of furnish data. Gov. Land State Land 1-3 years 3-5 years Forecast Development 1-5 Years Land Advisors Organization © 2020 All Rights Reserved While Land Advisors Organization makes every effort to provide accurate and complete information, there is no warranty, express or implied as to the accuracy, reliability or completeness of furnish data. Forecast Development 1-10 Years Gov. Land State Land 1-3 years 3-5 years 5-10 years Land Advisors Organization © 2020 All Rights Reserved While Land Advisors Organization makes every effort to provide accurate and complete information, there is no warranty, express or implied as to the accuracy, reliability or completeness of furnish data. Platted lot story 22,210 Lots Future Marana Lots Builder ownedP&E 935 Redesi gn Zoned 18,57 Land Advisors Organization © 2020 All Rights Reserved While Land Advisors Organization makes every effort to provide accurate and complete information, there is no warranty, express or implied as to the accuracy, reliability or completeness of furnish data. Marana Development Line Land Advisors Organization © 2020 All Rights Reserved While Land Advisors Organization makes every effort to provide accurate and complete information, there is no warranty, express or implied as to the accuracy, reliability or completeness of furnish data. Marana 18 Month Blackout progression Land Advisors Organization © 2020 All Rights Reserved While Land Advisors Organization makes every effort to provide accurate and complete information, there is no warranty, express or implied as to the accuracy, reliability or completeness of furnish data. Infrastructure Requirements Land Advisors Organization © 2020 All Rights Reserved While Land Advisors Organization makes every effort to provide accurate and complete information, there is no warranty, express or implied as to the accuracy, reliability or completeness of furnish data. Main Future Lot Supply Land Advisors Organization © 2020 All Rights Reserved While Land Advisors Organization makes every effort to provide accurate and complete information, there is no warranty, express or implied as to the accuracy, reliability or completeness of furnish data. Takeaways •Demand is surging for several factors (growth plans, market- share/competition, etc.). •Homebuilders ordered 3x as many lots unexpectedly in 2020. •Historic lows of both active community counts and MLS Supply. •Trend of building faster than replacing. •Finished lot prices will continue to increase. •Need between 16,250-34,550 lots over the next 5 years to keep up with projected demand. •±39 months to zone, entitle and develop. •Last cycle was oversupplied, and this cycle is opposite. Land Advisors Organization © 2020 All Rights Reserved While Land Advisors Organization makes every effort to provide accurate and complete information, there is no warranty, express or implied as to the accuracy, reliability or completeness of furnish data. What can Marana Expect •Marana can expect market share to grow to 40% of Pima County •Half a year of entitled lots •Northeast and South Marana are nearly out of land •All attention will be placed on North Marana for future growth •North area will have to be resupplied in 18-24 months •Infrastructure is key, funding and timing •Fast track of approvals (Plats/Zoning) •Increase density/flexibility to specific plans •This could be the busiest time in 30 years TUCSON OFFICE 3561 East Sunrise Drive, Suite 207 Tucson, Arizona 85718 520.514.7454 LandAdvisors.com