Toll Scorched in Arizona

Butler agrees that the Toll project probably could not be built at a profit today given the high price paid for the land.

In early 2006, when the deal closed, "the market had begun to slow down, but I don't think anyone had bought into that idea yet," Butler says. "People were still buying land with the idea that Phoenix would grow forever.

While investors in Simon Property Group can be comforted that there will be no further writedowns related to that project, shareholders in Toll Brothers and Meritage continue to sit in the dark as to future impairment charges on the projects.

It's appropriate that the project is in a place named "Surprise."