Victor’s Insider Scoop on Why Would Anyone Buy Large Tracts of Land Over 60 Miles West of I-17? …
August 10th, 2008 | top of page
Ask most Phoenicians where Harquahala Valley is and you’ll probably get a shrug. Head west from The Stack on I-10 and go past Tolleson, past Avondale, past Buckeye, past Tonopah and in about an hour, after driving by miles and miles of undeveloped desert you’ll hit the interchange for 515th Avenue aka Harquahala Valley Road. You’ll probably be as underwealmed as I was by the sleepy roads and old farm buildings visible as you drive the 11 miles south to Baseline Road where Harquahala Valley Road ends.
But, Harquahala Valley has not escaped notice by one of the Valley’s shrewdest real estate investors: Conley Wolfswinkle. In July 2005 Wolfswinkle paid over $94mm for 15,470 acres in Harquahala Valley. His most recent acquisition added 960 more acres bringing about 24,000 acres under his control.
Now, why, oh why would anyone want so much land so far removed from metro Phoenix when, in these troubled times, most investors are only considering investments within the Loop 101 and Loop 202 rings? My answer has 4 components:
1. Water. According to propertyrightssearch.org at the end of 2002 Vidler Water Company owned or had the right to acquire almost 50,000 acre feet of transferable water rights in Harquahala Valley. In order for home developers in Arizona to secure a Public Report from the Arizona Department of Real Estate, the developer has to document an assured 100 year water supply. The Arizona State Legislature has passed legislation allowing Harquahala Valley ground water to be made available as assured water supply to cities and communities in Arizona through agreements with the Central Arizona Groundwater Replenishment District. Furthermore, the Arizona State Legislature has passed several pieces of legislation recognizing Harquahala Valley ground water as a future municipal supply for the Phoenix metropolitan area. In 1991, the expansion of irrigated farming in the Valley was prohibited, and the transfer of the ground water to municipalities was authorized.
2. Solar Generated Electricity. Harquahala Valley is home to the Harquahala Generating Station on Courthouse Road just east of Harquahala Valley Road. The in-place high voltage infrastructure linking Arizona and California (Palo Verde generating station is just east of Harquahala Valley) seems ideally suited to transmitting solar generated electricity to both Arizona and California. The resurgence in solar generated electricity as demonstrated by the recent solar farm announced in the Gila Bend area bodes well for future solar electricity generating developments in Harquahala Valley.
3. Interstate 10 Frontage & Interchange. Located just five hours from the near capacity California ports of metro Los Angeles, Harquahala Valley’s current land prices of less than $10,000 per acre may eventually be attracting industrial developers and new warehouse facilities.
4. In The Path of Progress. Although it may still be a long time coming, Harquahala Valley is on the transportation and development corridor west of Phoenix. Given Harquahala Valley’s assets previously listed it is not too much of a stretch to imagine development leapfrogging over much of the Tonopah area to Harquahala Valley. The only question is when. With the Wolfswinkle’s long term outlook on Harquahala Valley I can see four possible profit centers for their holdings:
• selling water to home developers who cannot otherwise secure a Public Report due to assured water supply issues,
• selling land to or JVing with solar electricity generators,
• selling land to industrial developers or developing warehouses, and
• selling land to homebuilders or developing housing to support the nearby solar/industrial developments.
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PS – If you are ready to begin to thrive again by getting off the sidelines and putting your money to work give me a call at 602-320-6200. I see lots of deals and may have just what you are looking for.