Situation: 2+ acres of splittable R-43 land on a gorgeous setting adjacent to the Phoenix Mountain Preserve. Original owner, now in his 90s, selling his half of a property originally purchased in 1972 with his wife and his business partner and his wife.
In late 2020, I was honored to have the task of selling this beautiful vacant land parcel. I love property with history. This was a 2+ acre property, splittable by right into two lots. It was originally purchased in 1972 as a 4.6+ acre property by two families and split equally in 1978. The eastern half had a home built on it in 1979 (see “PHOENIX MOUNTAIN PRESERVE” Part 2). My seller/client had the western half. We had a copy of the original survey split and legal descriptions from 1978 that a Buyer could use for their own survey update. At this time, the market was very hot and one of our conditions would be a shortened due diligence time where the Buyer would need to do their own survey update (if they even chose to do one during escrow) that would have no bearing or effect on the contract terms.
Once word got out the parcel would be put up for sale for the first time in almost 50 years, I was inundated with inquiries from neighbors and received multiple offers in the first 24 hours of market time.
One neighbor in particular feared construction on the site would block his view of the Mountain Preserve. He sent us a great offer. He pledged to not build on it and his motivation was simply to preserve his view. Looking at the other offers received, they all wanted to build on the property, a couple of them intended to split it and build two homes. The prices on the offers were all very similar.
My seller/client, not only looking out for himself but also for his widow friend who still lived in the 1979-built home on the adjacent property, chose to go with the neighbor’s offer over the others. He was happy with the negotiated price, terms, and conditions and also figured no construction to bother his friend in her home was the right thing to do.
This is where the escrow process gets crazy.
A buyer who was late to the game continued to contact me and wouldn’t take no for an answer. The property was in escrow and there was no way to bump the current buyer out of his position. This motivated buyer and his broker continued to push and push to somehow get their hands on the property.
Eventually, the first-position buyer agreed to meet the motivated buyer. At the end of their meeting, the first-position buyer agreed to assign his contract to the motivated buyer on three conditions:
- An agreement to dedicate the north half of the property as a “no-build” zone, including no lighting, driveways, sidewalks, or alterations of any kind. It would remain 100% in its natural state. This would preserve the first-position buyer’s main view of the mountain preserve from his property. Any construction would occur on the south side of the property.
- The motivated buyer would also need to contribute a considerable amount of money to the first-position buyer’s charity of choice.
- No changes would be made to the original terms and conditions of the contract, and my seller/client must approve of the assignment.
My client/seller agreed to change the buying entity knowing his friend would not be bothered with construction immediately adjacent to her home. He liked the idea that half of the property he owned would remain as open desert space. The other terms and conditions of the contract stayed the same. A real estate attorney drew up the dedication language and it was approved by all parties.
Per Arizona contract law, an assignment of a contract only means the buying entity is changed. The new buying entity’s representation does not become party to the transaction (and not compensated); they are simply in an outside advisory role. The original buyer’s brokerage still oversees the contract. So the new buyer who took over the contract was now being represented by the original buyer’s agency. This led to a slew of issues I had to deal with that I won’t get into here, but you can imagine the remainder of the escrow period was an ardous one.
In the end, we had the open space designation language recorded with the transaction documents at close of escrow. Seller was happy with the proceeds, the neighbor’s view wouldn’t change, and the new buyer convinced everyone he’d be the right owner of the property (after all that, he has since re-sold the property).
To this day, this is one of the slickest moves I’ve seen by a buyer who wrapped up a property only for his personal view and enjoyment, was prepared to pay seven figures for it, but recognized his leverage to still get what he wanted and not spend a dime. A true master class. Bravo, sir!
PHOENIX MOUNTAIN PRESERVE Part 2 gives a little more background on the history of the property and reveals a big mistake made in the original survey split.