Monday, March 3, 2014

DeRito Partners Acquires Municipally Held Property in Chandler

The City of Chandler recently approved an ordinance for the sale of 31.22 acres of municipally-owned land at the southwest corner of Gilbert and Ocotillo Roads. The site, which was previously intended for a wastewater treatment plant, was acquired by DeRito Partners Development Inc. in the amount of $8,647,334.00 ($276,980 per acre or $6.35 per square foot)  and will be developed with both residential and commercial improvements. Revenue from the sale of the property will be credited to the water and wastewater operating funds.

Chandler had been contacted by various groups in recent years regarding a potential sale of the property; however it was only until last year that officials began to initiate the process. To determine the feasibility of selling the property, Chandler opened a Request for Proposal (RFP), which accepted submittals between August 30, 2013, and October 29, 2013. The RFP enabled Chandler to select applicable proposals and to incorporate stipulations within the structure of both the sale and proposed build-out of the site. Stipulations mentioned in the City Council memo from February 27, 2014, read as follows:
  1. Purchase of the entire parcel, not just a portion of the site
  2. The development of a significant, anchored commercial center
  3. The development of a quality project that is consistent and compatible with existing and other planned projects in the immediate area
  4. An aggressive timeline for developing at least the commercial component of the development
View the original city document with purchase agreement here

Conceptual site plan of DeRito development on southwest corner of Ocotillo and Gilbert Roads
The RFP received a total of seven proposals - from which, 4 were eliminated. Out of the top three proposals, another was rejected as it solely envisioned the site for commercial use. A committee of City staff eventually recommended DeRito as the winning proposer, as the proposal proved the best combination of short-term and long-term financial benefit to the city. DeRito will place $100,000 into an escrow account within five days of the approval, and has agreed to close the sale by December 31, 2014 (as per outlined in purchase agreement). In addition, DeRito will be responsible for obtaining all of the necessary entitlements in a timely manner. It was mentioned at the City Council meeting, both by a representative of DeRito and by the Brown Group (runner up proposer), that Fry’s Food & Drug is likely to become the anchor tenant of the commercial component. No specific information was provided in relation to residential portion of the project.    


Cody Weisel

Planning & Zoning Analyst

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