This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Toll Scorched in Arizona

One of the biggest residential development projects in Arizona history is quietly turning into a major bust.

The question now is whether the big homebuilders involved in the deal -- Toll Brothers (TOL - Get Report) and Meritage Homes (MTH - Get Report) -- are properly marking down their land investments in the much-heralded venture.

In early 2006, the two high-end homebuilders partnered with the country's largest mall owner, Simon Property Group (SPG - Get Report), to pay $312 million for a 5,485-acre parcel of land northwest of Phoenix in the city of Surprise, Ariz.

With the once-hot Phoenix market crash-landing, it now appears that Toll Brothers and its partners ended up paying too much for the land, on which they likely cannot build today for a profit.

At the time of the purchase, Toll Brothers, the general partner of the joint venture, trumpeted the deal as the "most expensive" land transaction in Arizona history, citing research from the Arizona Republic. The plan called for the companies to build a mixed-use, master-planned community with 15,000 to 31,000 homes that were originally expected to go on sale in 2009.

Simon Property was planning to build the retail portion of the development. But a source at the real estate investment trust tells that the company has decided to scrap the retail portion of the project, which is the reason for a writeoff of the venture last week.

1 of 5

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
MTH $44.82 0.00%
TOL $37.69 0.00%
SPG $183.62 0.00%
AAPL $132.54 0.00%
FB $80.54 0.00%


DOW 18,232.02 -53.72 -0.29%
S&P 500 2,126.06 -4.76 -0.22%
NASDAQ 5,089.3620 -1.4320 -0.03%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs