The Howard Hughes Corp. broke ground on Teravalis, a mixed-use master plan community in Buckeye, Arizona. The 37,000-acre project will ultimately comprise 55 million square feet of commercial development in the fast-growing metropolitan area of Phoenix.
Work on Teravalis, formerly known as Douglas Ranch, begins almost exactly a year after HHC acquired the shovel-ready land JDM Partner and El Dorado stocks in a deal valued at approximately $541 million. The property, located approximately 35 miles from downtown Phoenix in the West Valley, was in good standing at the time of the transaction.
Teravalis will have 100,000 homes housing an estimated total of around 300,000 residents surrounded by a variety of commercial offerings in this city-within-a-city.
“What we are witnessing today is a true paradigm shift as employees set the pace and influence where companies choose to be located while following the well-educated workforce moving to communities where people want to live, who want a better quality of life, professional Offering success, shorter commutes and urban walkability,” said Heath Melton, Phoenix Region President for The Howard Hughes Corp Commercial real estate agent.
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Given the early stage of the project, HHC has not yet finalized the exact breakdown of the commercial offerings; The company will start developing the residential components, commercial areas will follow as needed. In general, however, the commercial elements will reflect those seen in the Company’s portfolio of highly successful mixed-use, end-to-end planned communities.
“What we have demonstrated in Howard Hughes communities nationwide is our expertise in creating walkable, mixed-use areas with a cohesive, dynamic mix of office, retail and entertainment space, all carefully integrated into the surrounding natural environment ‘ Melton said. “We create and curate placemaking experiences that improve the quality of life for our residents by offering housing options in close proximity to great commercial offerings – shopping, dining and entertainment – and Teravalis will be no different.”
Magnet for business
Teravalis in and of itself will be a lure for commercial real estate users as the development will have a reputation for being the largest master planned community in the state of Arizona. Additionally, the location of the project will put it right in the path of business – literally. The sprawling enclave will emerge near the proposed Interstate 11 that will connect Phoenix to Las Vegas and Southern California, and over time the thoroughfare will serve as a trade route between Canada and Mexico.
“This future trade route will fundamentally change the trading opportunities – for Teravalis and the entire western region,” added Melton. “Direct alignment with the future home of I-11 positions Phoenix’s West Valley as an ideal hub for light industrial and logistics development.”
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Teravalis will also position itself as a high-tech, eco-friendly destination. Sustainability and conservation will be key themes of the development, with an emphasis on open space and emphasizing the natural surroundings of the site, which is nestled between the White Tank and Belmont mountain ranges. The project’s new name, Teravalis, or “Land of the Valley,” is a literal description of the vast area.
HHC is not alone in its quest to bring Teravalis to life. Under the terms of the 2021 acquisition agreement, JDM had the right to exercise options to repurchase interests in the project, and in August 2022 JDM did just that. The minority owner exercised its second option, earning an additional 2.8% interest in the Community joint venture for approximately $15 million, bringing his total interest in the partnership to 12 percent.
The next step forward at Teravalis will include HHC’s announcement of the project developers that the company plans to plan later in 2022. If all goes according to plan, Teravalis will make its debut in late 2024.