By New Times
By Connor Radnovich
By Robrt L. Pela and Amy Silverman
By Ray Stern
By Keegan Hamilton
By Matthew Hendley
By Monica Alonzo
By Monica Alonzo
There is absolutely no doubt that APS sold the land way below the full cash value placed on the property by the assessor's office. But get a load of this: As I've stated, the assessor's full cash value is usually far below the market value. In this case, the market value of the land purchased by the Wilcoxes in September 2003 was more than four times greater than what APS sold it for, according to downtown Phoenix real estate investor Michael A. Levine.
APS sold the land to the Wilcoxes for $3.40 per square foot. Levine, who owns and operates surface parking lots within a few blocks of the Wilcox property, says paved parking lots were selling for between $15 and $20 per square foot in 2003.
"That land should have gone for at least $675,000 and possibly for as much as $900,000," Levine told me.
Levine said even a "fire-sale" price would have fetched at least $10 per square foot, or $450,000 for the land sold by APS to the Wilcoxes.
There's no doubt that downtown Phoenix land prices were clearly beginning a sharp increase by late 2001. In early 2002, the City of Phoenix, for example, purchased mostly dilapidated houses that were later torn down, paying as much as $24 per square foot for downtown property located north of Van Buren Street and west of Seventh Street.
So why would APS, a regulated electric utility company, eagerly sell downtown property far below market rate?
APS was under no financial pressure in 2003 to sell land to the Wilcoxes at the cut rate of $3.40 per square foot. APS is a subsidiary of Pinnacle West Capital Corporation, one of the state's largest companies with about $10 billion in assets.
Interestingly, about the same time the Wilcoxes opened escrow on the property in February 2003, a major downtown planning effort led by APS and sports mogul Jerry Colangelo was being secretly put together.
Sometime in early 2003, downtown power brokers began work on a downtown master plan to guide a multibillion-dollar redevelopment project to transform the city's inner core over the next decade.
The electric utility was among the insiders participating in the early stages of developing the master plan. And Mary Rose Wilcox had to be aware of the planning effort through her membership on the board of directors of the Downtown Phoenix Partnership -- a civic and business group that encourages development and played a leading role in developing the master plan.
Colangelo told me in the fall of 2003 that he and other business and civic leaders wanted to keep their master plan out of the public arena for as long as possible to prevent land speculators from moving into the market and driving up prices ("Operation Mickey Mouse," November 20, 2003).
It was during this time period -- when only a limited number of people knew that a major downtown redevelopment plan was in the works -- that APS sold its property at a rock-bottom price to Supervisor Mary Rose Wilcox and her husband.
In the past two years, property values have soared in downtown Phoenix and the rest of the metropolitan area. Levine says investors are now buying land in the area near the Wilcox property for between $30 and $60 per square foot, depending on the zoning.
This suggests that the Wilcoxes have seen the value of their property go up between 1,000 and 2,000 percent in two years.
Not a bad return.
You would think, with that much profit looming, that the supervisor and her husband could pay their county property taxes on the parking lot on time. But as of June 10, they were delinquent $9,214 for their 2004 property taxes, including $575.86 in interest.
The Wilcoxes' deal with APS only gets more questionable with the appearance of a con man like Charles Keating on the horizon.
Keating pleaded guilty to fraud charges and spent four years in prison for his role in the spectacular collapse of Lincoln Savings and Loan in the late 1980s. He also owes $3 billion to bondholders stemming from a civil judgment ("DeConcini & Keating," July 14, 1993).
The Lincoln Savings scandal led the U.S. Senate Ethics Committee to hold hearings into the actions of five senators -- including former Arizona senator Dennis DeConcini and Senator John McCain. All five received reprimands from the Ethics Committee for their unsavory ties to Keating.
Keating's longtime secretary, Carol Kassick, is one of the Wilcoxes' partners in Grant Park Enterprises II, the company formed to develop the land purchased from APS.
Keating was recently spotted by Arizona Republic columnist Richard Ruelas meeting with Earl Wilcox inside an SUV parked near the restaurant. He was also seen at the restaurant by New Times writers on one other occasion. Ruelas stated in a June 6 column that the Wilcoxes described Keating as a family friend.
Ruelas also reported that when he called Grant Park Enterprises II, none other than Charlie Keating answered the phone. Keating, Ruelas wrote, proceeded to berate him, telling him to "drop dead."
I called Grant Park Enterprises II on June 13, and an older man (based on his voice) answered the phone. Obviously, I can't say for sure that it was Keating, but immediately after I identified myself, the man laughed and hung up.