AZ Cenral – Developer of stalled condo project frustrated

by Peter Corbett – Aug. 7, 2008 10:18 AM
The Arizona Republic

A downtown redevelopment project that would replace 70 apartments with nearly 100 condominiums is stalled on the launching pad.

The $22 million development called Toscana is meeting resistance from city planners, who want better architecture for what they consider a gateway intersection into downtown.

The 4-acre Toscana project at Osborn and Miller roads is just east of Scottsdale Stadium and the San Francisco Giants training complex.

“It’s a high-profile location,” said Kim Chafin, a Scottsdale senior planner. “We want something nice there. We are raising the bar.”

That insistence on a more elaborate design and other hurdles has frustrated Toscana’s Scottsdale-based developer, the Continental Group.

It is not unusual for developers to bristle at perceived overreaching interference by planners and roadblocks that arise from city politics. But it is less common for builders to publicly express those frustrations.

In this case, John Lupypciw, Continental Group president, said he eager to get started on redeveloping a site that is costing him about $80,000 per month in capital carrying costs.

“Our plans were submitted in February under the current zoning and here it is August and we’re getting stonewalled,” Lupypciw said.

City wants better architecture

Planners counter that the Continental Group has not fully addressed the city’s concerns about Toscana’s initial proposal and the non-conforming elements of it.

Chafin sent a second review of Toscana on Aug. 1 outlining the remaining issues that must be resolved before the plan can go before the city’s Development Review Board.

City planners want single-story condos along the streets, stepping up to three or even four stories at the back of the property, she said.

Scottsdale also wants better pedestrian access through the property and improved building design, including shaded windows, more stone veneer and a variety of wall textures.

Toscana’s architecture must be “comparable or better than newer downtown projects,” Chafin wrote.

As designed, Toscana will include 97 condos in three-story buildings with an underground parking garage.

Toscana aims at “Chevy” market

Project manager Terry O’Neill said the architecture is comparable to other downtown projects that have been approved in recent years.

The Continental Group does not want to replicate the costly, ultramodern condo designs elsewhere in downtown.

“Not everyone wants to buy a Ferrari,” O’Neill said. “There are people who want to buy a Chevy.”

Toscana condos will likely be priced at about $500 to $550 per square foot, O’Neill said.

That is about half the price of some of the downtown’s costliest new penthouses.

O’Neill complained that the Continental Group has revised its plan 14 times to appease city planners.

“We’re trying to play by the existing rules, but they keep getting reinterpreted,” he said.

Old apartments would be razed

The Continental Group is anxious is to tear down the 40-year-old apartments on the site and start building condos, the project manager said.

About 30 families are living in the $500-per-month apartments and there are frequent break-ins to the vacant units, he said.

Neighbors have expressed height-and-density concerns with Toscana but the Continental Group plan to stay within the existing zoning restrictions, allowing a height of 36 feet.

However, the city has suggested a rezoning that would allow taller buildings on the northwest portion of the property and single-story units along the street frontage.

But O’Neill said that would delay the project, with neighborhood opposition likely, and would reduce the number of condos to about 75.

The Continental Group, which has done nearly 20 residential projects in the Valley and Calgary, Alberta, said it will take about two years to build Toscana.

The company figures the battered real estate market will be healthier by then.