30 Jul Scottsdale developer plans more single-family hybrid rental homes in south Phoenix
Just as Andrew Biskind and Ryan Hartman prepare to open a leasing office for an 85-unit single-family rental community in south Phoenix, they’re already making plans for a similar community two blocks away.
Unlike an apartment community, these single-story rental units offer more room, complete with their own backyard and doggie doors. Not only are they growing in popularity among renters, but investors also are scooping them up.
Plans call for opening a leasing office by the end of August to begin pre-leasing in September for the 85-unit Proximity 16th Street they built at the northwest corner of 16th Street and Baseline Road on 6.7 acres, said Biskind, vice president of Avenue North LLC.
The Scottsdale developer is in escrow to close on another 7.4 acres at the northeast corner of 18th Street and Baseline for an 80-unit community called Proximity Baseline, he said.
Escrow is expected to close in October, said Hartman, chief vision officer for Avenue North. Groundbreaking should begin during the fourth quarter and begin leasing a year later in Q4 2021.
Development costs for each project is around $17 million, with financing coming from private equity and construction debt.
Rental rates for Proximity 16th Street will range between $1,400 and $1,500 a unit, Hartman said.
It’s too soon to determine rental rates for Proximity Baseline, which received unanimous zoning approval by Phoenix City Council on June 24, Biskind said.
“This was a very challenging zoning case with the South Mountain Village Planning Committee, and a few delays we experienced related to Covid,” Biskind said. “The rezoning process lasted roughly 12 months.”
Amenities for both Proximity communities include a community garden, dog park, bike racks and bike repair station, resort-style pool, outdoor kitchen and lounge area, private backyards, garages, direct access to the canal walking path, views of South Mountain and professional onsite management.
Residents will be within walking distance of the light rail extension at Central Avenue and Baseline once it’s completed, Hartman said.
“This brings a suburban product to an urban location,” he said.
Mod A&P and Felton Group are the primary architects for both communities. While a general contractor has not been named for Proximty Baseline, the GC on the first community was Beckshar, Hartman said.
Looking for more deals
Biskind and Hartman also have broken ground for another single-family for rent product in Las Vegas.
“We’re actively searching for more land opportunities,” Biskind said.
While these are the first build-for-rent communities being marketed under the Proximity brand, Avenue North also owns Proximity at Papago, a 200-unit traditional garden-style apartment community built in the 1980s, but is putting it on the sale block.
Trevor Koskovich, president of investment sales for NorthMarq, is handling the sale of Proximity at Papago. He also was the broker who handled the Christopher Todd Communities build-to-rent sales in March and in April.
“We’re calling for offers in about two weeks,” Koskovich said.
Once Proximity at Papago sells, the name will be changed because the Proximity brand is trademarked, Biskind said.
“We’ll keep the Proximity name for our single-family product,” he said.
There is much demand for the build-to-rent product both from an operations perspective and a sales perspective, Koskovich said, especially in this Covid environment where apartment renters working from home are seeking larger homes and less dense environments.
“I think the investors out there are coming around to the product type and realizing it’s an asset class that’s here to stay,” Hartman said. “It certainly appeals to a wide variety of people.”
Phoenix Business Journal