A Phoenix-based developer announced the $37.2 million sale of a build-to-rent community along Deer Valley Road in north Phoenix.
The developer, NexMetro Communities, announced the sale of the single-family rental Avilla Homes project — a transaction officials say is “a record milestone that shows the long-term value” of the Avilla brand of single family rental neighborhoods in the Valley.
The sale closed Oct. 29. Officials said units in the Avilla Paseo community, which has 89 homes, sold for about $418,000 each — more than double the company’s first Phoenix-area asset sale, which took place in 2018, a press release said.
In June 2018, its sale of a similar Goodyear community fetched a lower $200,000 per unit, the press release said.
The property of the most recent sale is at 3425 W. Deer Valley Road in Phoenix. It was sold the project to Logan Capital Advisors of San Diego.
“This NexMetro sale further validates the tremendous value in the market for the higher quality leased-living experience that makes Avilla Homes such a unique alternative to the typical apartment rental,” said Richard Van Wert, chief investment officer of NexMetro Communities.
The press release said NexMetro has about 7,000 homes completed, under construction or in development in multiple markets across the country. The company “typically” looks to hold most of its Avilla Homes projects for longer- term operation, according to the press release.
NexMetro has additional neighborhoods in Denver, Dallas and Tampa.
The growing trend of specialized single-family home rentals is surging amid the tight supply of homes for sale in the Valley real estate market.
Developers such as Nex-Metro and Christopher Todd Communities are seizing the opportunity to meet the growing demand of people renting an unattached apartment rather than occupants having to commit to a 30-year mortgage.
At Christopher Todd Communities, rental homes come with granite counters, stainless steel appliances, upgraded cabinetry and energy-efficient dual-pane windows, plus a doggy door and gated private backyard. All homes are equipped satellite TV access, smart home technology including keyless entry, climate control, doorbell camera, lighting, and security cameras.
Jacque Petroulakis, NexMetro executive vice president of marketing and investor relations, said the company sees “considerable demand” in Phoenix for its product.
She said consumers in the Avilla Homes neighborhoods are a “very diverse” mix of either professional millennials who want flexibility for job movement or those in a life stage transition such as divorce. Baby boomers who simplify their lives or retirement also are taking advantage of the communities.
The neighborhoods typically have very few children,” she said.
“These are renters by choice for the most part,” Petroulakis said. “They have the wherewithal to buy, but are choosing to rent to best suit their lifestyle. And all of these consumers find the hassle- free lifestyle of 24-7 maintenance very appealing.”
NexMetro is still growing. The company has plans for Avilla Vista Norte — another build-to-rent community with 191 units near Anthem. Construction is set to begin in 2022. The development will sit off Interstate 17 between Old West Trail and Circle Mountain Road, near Anthem’s border.
That development, on 16.8 acres, is slated to be ready for occupancy in late 2023 or early 2024, according to NexMetro officials.
The new owners of the Deer Valley property are eager to capitalize on the new venture and mentioned the Taiwan Semiconductor Manufacturing Co. fab as a positive for growth.
“We are excited about the economic activity occurring in north Phoenix with the construction of TSMC’s new $12 billion semiconductor plant, just seven miles from Avilla Paseo,” said Ruben Islas, a founding partner in the San Diego company. “In addition, we love the single- family rental space.”
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