Anthem Phoenix, Arizona Project Type: Residential Case No: C033018 Year: 2003 SUMMARY Anthem is a 5,860-acre (2,371-hectare) master-planned community located in the North Valley of Phoenix, Arizona. Anthem’s plan allows for a family-oriented lifestyle, providing recreational facilities for residents of all ages. The community comprises basic elements of a small city: houses, shops, restaurants, entertainment venues, sports facilities, offices, and municipal services. Homes at Anthem range in price from the low $100,000s to more than $400,000 and measure from approximately 1,200 to 4,400 square feet (111 to 409 square meters) in size. FEATURES Multigenerational master-planned community. Developer contributed land and constructed a school on it, donating both. Developer carried full financial burden for the community’s development. Purchase of water rights from local Indian tribe.
Transcript
Anthem
Phoenix, Arizona
Project Type:Residential
Case No:C033018
Year:2003
SUMMARY
Anthem is a 5,860-acre (2,371-hectare) master-planned community located in the North Valley of Phoenix, Arizona.Anthem’s plan allows for a family-oriented lifestyle, providing recreational facilities for residents of all ages. Thecommunity comprises basic elements of a small city: houses, shops, restaurants, entertainment venues, sportsfacilities, offices, and municipal services. Homes at Anthem range in price from the low $100,000s to more than$400,000 and measure from approximately 1,200 to 4,400 square feet (111 to 409 square meters) in size.
FEATURES
Multigenerational master-planned community.Developer contributed land and constructed a school on it, donating both.Developer carried full financial burden for the community’s development.Purchase of water rights from local Indian tribe.
Anthem
Phoenix, Arizona
Project Type: Residential
Subcategory: Planned Communities
Volume 33 Number 18
October–December 2003
Case Number: C033018
PROJECT TYPE
Anthem is a 5,860-acre (2,371-hectare) master-planned community located inthe North Valley of Phoenix, Arizona. Anthem’s plan allows for a family-orientedlifestyle, providing recreational facilities for residents of all ages. The communitycomprises basic elements of a small city: houses, shops, restaurants,entertainment venues, sports facilities, offices, and municipal services. Homesat Anthem range in price from the low $100,000s to more than $400,000 andmeasure from approximately 1,200 to 4,400 square feet (111 to 409 squaremeters) in size.
Anthem is an example of a large-scale master-planned community developmentpaying for itself. Overcoming a lengthy, difficult, and expensive planning and approval process, the development team used innovative methods to construct one of the most successful developments in Arizona.
SPECIAL FEATURES
Multigenerational master-planned community.Developer contributed land and constructed a school on it, donating both.Developer carried full financial burden for the community’s development.Purchase of water rights from local Indian tribe.
DEVELOPER
Anthem by Del Webb and Pulte Home Corporation3701 West Anthem WayAnthem, Arizona 85086623-742-6000Fax: 623-742-6100www.anthemarizona.com
SITE PLANNERS
LVA Urban Design Studio, LLC (formerly Larson, Voss, Associates)7502 East Main StreetScottsdale, Arizona 85251480-994-0994Fax: 480-994-7332www.lvadesign.com
Swaback Partners, pllc7550 East McDonald Drive, Suite AScottsdale, Arizona 85250480-367-2100 Fax: 480-367-2101 www.swabackpartners.com
Richardson Verdoorn Associates712 Congress Avenue, Suite 300Austin, Texas 78701512-480-0032
Located 35 miles (56 kilometers) north of downtown Phoenix, Arizona, Anthem is a 5,860-acre (2,371-hectare)master-planned community that provides an amenity-oriented lifestyle to its residents. Designed to offer activitiesand services customized to fit the way today’s families live, work, and play, Anthem is intended to comprise allaspects of a small city. So far, 5,000 homes have been sold out of a maximum buildout of 12,000 units, and there arerecreation areas, parks, open space, and municipal services. A K–8 school has been built, another is in the planningstage, and a high school is projected to open in 2004. In addition to residential uses, the community currently hasmore than 300,000 square feet (27,870 square meters) of commercial, office, and industrial uses, primarily to servethe needs of residents of Anthem and nearby areas. Another 275,000 square feet (25,547 square meters) ofcommercial/office space is under construction. At buildout, Anthem is expected to have over 2 million square feet(185,800 square meters) of commercial, office, and industrial space.
The community provides many recreational options geared toward all age groups. The 43,000-square-foot (3,995-square-meter) community center offers after-school activities and a complete fitness center that features a three-story rock climbing wall, outdoor tennis courts, a dance studio, and a teen recreation room. The Big Splash Water Park contains over 400,000 gallons (1.5 million liters) of water that flows through this aquatic playground that surrounds two water slides and includes amenities such as a beach-entry leisure pool, a tot pool, a 25-meter eight-lane lap pool, and a diving tank. A 63-acre (25-hectare) community park offers sport courts and fields, a kid-sized train that runs through the park, a large playground, a four-acre (1.6-hectare) catch-and-release fishing pond, barbecue grills, and picnic pavilions. The community also features the 34,000-square-foot (3,185-square-meter) Anthem Golf and Country Club, which is one of the few private clubs in Arizona offering 36 holes of championship golf. Members have access to the clubhouse and use of its swimming pools, tennis courts, fitness center, and dining room. A second 33,000-square-foot (3,066-square-meter) clubhouse is planned to open in 2005.
Anthem provides a variety of shops and restaurants in its first 128,000-square-foot (11,891-square-meter)neighborhood retail center known as Anthem Marketplace. The marketplace includes a 55,000-square-foot (5,109-square-meter) Safeway grocery store, a drugstore, a dry cleaner, fast-food restaurants, a hair salon, and a place to rent videos and DVDs. More businesses are being added as Anthem continues to grow, and three additional retail centers are forthcoming. Each retail center has been planned strategically at major intersections throughout the community.
Plans are underway to locate professional and medical facilities in the middle of the development that wouldpotentially provide jobs for residents on site.
DEVELOPMENT PROCESS AND FINANCING
Founded in 1928, the Del Webb Corporation has constructed more than 100,000 homes in communities around thecountry. Known for its “Sun City” retirement communities, Del Webb created Anthem as its first non-age-restricted,multigenerational housing development. Anthem is part of the company’s plan to diversify its development projects.What differentiates Anthem from Del Webb’s other communities is that it is fully equipped for families but alsocontains a country club community, striving for a multigenerational approach. Now a part of Pulte Homes, the DelWebb brand continues to build age-qualified and multigenerational communities across the nation.
Through the efforts of nearly 700 construction workers and landscapers, the site was transformed from a rural pieceof land into a residential playground. Residences are being built in two main villages: Anthem Parkside, aimed at people between 25 and 40 with children, and the Anthem Country Club, targeting professionals 40 to 60 years of age, preretirees, and empty nesters.
To attract families, the developer knew that it was imperative to construct schools. The master plan for Anthemcomprises four K–8 school sites (15 acres/six hectares each) and one high school site (60 acres/24.2 hectares). DelWebb donated all 120 acres (48.5 hectares) for the schools, valued at $11 million, to the local school district. Thedeveloper also built and furnished the first K–8 school at an additional cost of $8 million, donating the facility to thedistrict. Although it is open to children in the area, Anthem residents have first priority and many of their children usethe community’s trail system to walk and bike to school.
In 1995, Del Webb announced its plans to develop Anthem on a vacant piece of unincorporated property surrounded by low-density rural development. The plan stirred up controversy among neighbors and local and state officials who did not want any more growth in the area, fearful that additional residents and increased density would bring noise, pollution, traffic congestion, and crime. Because of this antigrowth reaction, the media attention that resulted from it, and the location of the property, the developer decided not to place an extra burden on taxpayers. Instead, the developer assumed the full financial burden for the community, and provided all of the equity for the project, using no public money. The developer invested approximately $7 million for a nine-mile (14.4-kilometer) pipeline to carry
water from Lake Pleasant to the community. To alleviate concerns over increased congestion, Del Webb funded the construction of the Interstate 17/Anthem Way interchange. The development team even paid for the consultants the county hired to review the master plan. To get the project off the ground, Del Webb spent almost $180 million, most of which was spent on infrastructure, before the first house was occupied.
Anthem posed a major financial risk to the developer due to its distance from the developed region of Phoenix and the aforementioned controversy surrounding it. The developer purchased the land for approximately $12 million in 1991, knowing that development could not begin for five to ten years. Because of the high level of risk, more money was put into the development upfront than is usually necessary. The development team wanted all the amenities to be completed before any homebuyers came to look at the property, as a way to enhance its appeal. Development costs to date total $953 million.
THE SITE
Nestled in the foothills of the Sonoran Desert in North Valley, near the New River, Anthem is located five miles (eightkilometers) north of Carefree Highway at the foothills of Daisy Mountain off of Interstate 17. Purchased from a local bank, the land had never been developed and was full of desert vegetation and several herds of grazing cattle. The entrance to the property is a half mile (0.8 kilometer) from Interstate 17, creating a separation from the highway. Since Anthem opened, other communities have been developed in the desert south of it along Interstate 17 and the Pima Freeway east from I-17.
PLANNING AND APPROVALS
When the land was purchased, there were no new production homes within a ten-mile (16-kilometer) radius and noutilities on the site. These factors, along with the antigrowth sentiment in the surrounding area, caused the planningstage to be a very time-consuming (three years) and expensive process, costing $6 million before construction began.Because of the strict local, state, and federal guidelines, including approval by the U.S. Congress for water use, thefirst individual Section 404 permit in Arizona, an environmental impact statement approved by the Bureau ofReclamation, and Anthem’s wide range of amenities, the company employed outside consultants who specialized indifferent areas of master-planned communities such as aquatic centers, recreation use and equipment specialists,architects, interior designers, landscape architects, and engineers.
The lack of utilities required the development team to be innovative in its planning and design. Because there was no access to water on the site, the development group purchased a 100-year agreement for water rights from the Ak-Chin Indian community. Requiring complex negotiations, water rights are a hot commodity in desert communities. Established in a 1908 U.S. Supreme Court decision called the Winters Doctrine, tribal water rights were reinforced in a 1963 decision. In a verdict against Montana farmers who wanted to use Indian water, it was ruled that tribes must be allocated water in amounts sufficient to meet the needs of their reservations. Because many tribal reservations lack the necessary canals and pipelines to provide water to their populations, outsiders have used much of the water, often without compensation. In recent years, however, Native Americans have been fighting for better compensation for the use of their resources. In the case of Anthem, Congress had to pass an act to allow the development team to purchase water rights from the small Ak-Chin Indian Community.
The development team went through a long, drawn-out approval process, involving local, municipal, state, andfederal participants. On the local level, the two areas adjacent to the Anthem site were unincorporated developments, each with its own governing body. In order to take the proposal to the county, Del Webb needed the approval of the adjacent developments. Next, the plan had to go before Maricopa County in order to request a rezoning from one home per acre (one per 0.4 hectare) to a gross density of up to 2.05 units per acre (5.04 per hectare). The county approvals process took over two years because of density issues. The site originally was planned to accommodate 16,000 units, but this number ultimately was reduced to 12,000. To gain the approval of numerous local interest groups, Del Webb brought in a team of lobbyists, consultants, residents, and experts to alleviate some concerns surrounding the development.
Throughout this process, the development team had to work with five state agencies: the Arizona Department ofWater Resources, the State Historic Preservation Society, the Arizona Department of Environmental Quality, theArizona Department of Transportation, and the Arizona State Fish and Game Department. At the federal level, theteam worked with the U.S. Army Corps of Engineers and with two agencies of the U.S. Department of theInterior—the Bureau of Land Management and the Bureau of Reclamation.
One problem that needed to be addressed was the lack of employment opportunities proximate to Anthem. Thedeveloper built Anthem Marketplace, Anthem Commerce Park, and Anthem Medical Plaza to help meet some of thisneed. Also, a large proportion of Anthem’s residents are self-employed and work out of their homes. The first retailcenter to open in the community, the Anthem Marketplace, serves residents of both the development and thesurrounding areas. There are plans to open three additional retail centers in the near future. The Anthem CommercePark features 104 acres (42 hectares) for independent businesses, distribution facilities, offices, and other service-related uses. Those already operating in or committed to the Anthem Commerce Park include a Comfort Suites motel,a U-Haul storage facility, a Mobil gas station, and a Wal-Mart store, just to name a few. Anthem Medical Plaza will
include the $2.5 million, 10,000-square-foot (929-square-meter) John C. Lincoln Health Center and currently has a16,500-square-foot (1,533-square-meter) pharmacy. It is expected that Anthem will create approximately 1,000on-site jobs. Anthem Corporate Park, a 60-acre (24-hectare) professional office complex, is planned for developmentin late 2003. Military insurer USAA opened a hub five miles (eight kilometers) south of the community along the I-17corridor, giving Anthem a large employer nearby.
DESIGN
The development is organized around major amenities. The centrally located community center is the hub of thewhole project. Adjacent to it is the community park, which surrounds the first K–8 elementary school. All three ofthese amenities are connected by trails, and the neighborhoods were planned outward from that point. According tothe master plan, approximately 52 percent of the acreage is dedicated to residential uses, 11 percent to mixed uses,and 36 percent to open-space and recreational uses.
The development team endeavored to incorporate the natural terrain and vegetation into the community. Some 2,100 acres (850 hectares) are reserved as open space, including the golf courses and the 63-acre (25-hectare) community park. The master plan is sensitive to the natural terrain, working with the environment instead of against it. Cacti and other plants that needed to be removed to make way for streets and houses were replanted in road medians or in on-site nurseries. Extensive paths and trails serve as important links throughout the community, connecting all neighborhoods and social areas and allowing for equestrian access, hiking, and other uses. All hillside areas above the 15 percent slope line are protected from any development.
A diverse street theme of rich architectural detail and mature landscaping, varied color schemes customized to blend with surrounding natural features, and exterior designs reduces some of the monotony common in planned communities. Stucco is the predominant building material and sandstone is used as a design feature. Because the team worked with the natural terrain, there are no straight streets in Anthem; rather, they meander through the gentle hills and valleys. The master plan also includes many culs-de-sac, with the belief that families like this street type best. Houses are oriented to ensure maximal sun in the winter and minimal sun during the summer.
With a planned maximum buildout of 12,000 units, Anthem features a selection of neighborhoods offeringapproximately 68 home plans and prices on behalf of seven builders: Del Webb, Pulte Homes, Centex, US Homes,Greystone, Engle, and Hacienda Homes. Each home must meet extremely specific design guidelines that aremonitored by the homeowners associations. Anthem’s Parkside homes are divided into five series, with each seriesoffering four to seven different models. Homes range in size from 1,112 to 4,338 square feet (104 to 403 squaremeters), include three to five bedrooms and 2.5 to 3.5 bathrooms, and are priced between $129,000 and $400,000.
The Anthem Country Club is planned to comprise 2,800 residential units, 90 percent of which will back up to someform of open space. There are four series of homes, each with four different models. Homes measure from 1,100 to 4,320 square feet (102 to 401 square meters) and have two to five bedrooms and 2.5 to 4.5 bathrooms. Prices range from $135,000 to $450,000.
MARKETING AND BUYERS
In planning its developments, Del Webb typically conducts extensive market research. For this project, its market is broader than usual, including families, empty nesters, and preretirees. This change was in response to a large percentage of the population reaching retirement age who demanded a different type of retirement lifestyle than the age-restricted community that Del Webb is known for. As part of their research, the Del Webb staff members conducted a nationwide survey of 800 baby boomers and retirees, which showed that more than 60 percent of baby boomers polled continue to work at least 20 hours per week after retirement, almost 40 percent own two or more computers, 100 percent say they are more likely to start a new career in retirement, and 28 percent say they are likely to go back to school in retirement. These results are drastically different from those obtained when current retirees were surveyed, leading to the conclusion that baby boomers are seeking a much more active retirement lifestyle than that sought by previous generations. Del Webb also used auditorium focus groups, living room focus groups, mail and telephone surveys, and direct interviews with potential buyers to research the demographics and demands of the market. Real estate consultants were hired to analyze residential developments in north Scottsdale, north and northeast Phoenix, and the North Valley because these areas account for over one-half of all homes built in the valley. The Anthem development team tried to fill the void that existed in these areas, particularly the small range of housing plans historically offered.
Before Anthem was even opened, Del Webb spent more than $5 million on marketing. To help create intrigue aboutthe project, the public was not allowed to see any part of it until it was officially opened. Anthem was an immediatesuccess, with almost 7,000 people arriving for its "secret" pre–grand opening; almost 300 homes were sold within thefirst week. With its desert climate, luxurious amenities, and affordable prices, Anthem is an attractive choice for babyboomers looking for a change for retirement. The schools, parks, playgrounds, and activities in the development alsomake it an attractive choice for those with children. Over 23,000 visitors toured Anthem in the first nine daysfollowing the official opening. The developer attributes this turnout in part to having launched what was probably thelargest advertisement campaign in Phoenix’s history, which included radio, television, and newspaper ads as well as a
commercial during the Superbowl. The size of the crowds visiting the site during the first few days provoked a mediafrenzy. Sales began in March 1999 and by fall 2003, 5,000 homes had been sold.
One of the most effective aspects of the marketing strategy was the use of images that potential buyers would immediately recognize and relate to. The team developed several images, such as a golf ball on a tee, and a red bicycle, which were used in all Anthem advertising and public relations materials. These same images now appear on every piece of Anthem merchandise, such as hats and T-shirts. Through this visual marketing program, the images have become associated with the Anthem development, and the clothing bearing them has become an indispensable form of advertising wherever and whenever it is worn.
Each year, Anthem holds four or five large community events, such as “Anthem Day” and a Fourth of July celebration,complete with fireworks and carnival rides. Because nearly 10,000 people attend these functions, they serve both asresident activities and marketing events for prospective homeowners. In 2001, Anthem was voted “BestMaster-Planned Community in America” by the Washington, D.C.–based National Association of Home Builders and in1999 Del Webb won the “Builder of the Year” award by Professional Builder Magazine. Also, Anthem has been named top master-planned community in Arizona on numerous occasions by Arizona Business Magazine in its “RankingArizona” article.
MANAGEMENT
The basic management philosophy at Anthem involves taking the long-term view, with the goal of building asustainable physical and social infrastructure that responds to the environment. The overall governance of Anthem ishandled by the Anthem Community Council, a nonprofit organization that governs projects, owns and maintains allthe assets (i.e., community center, trails, etc.), and employs the people who work at the development. There aremultiple homeowners associations, all of which are subordinate to the Community Council. Fees for all amenities,including the water park and the fitness center, are included in the homeowners association dues. The homeownersassociations also are responsible for enforcing the community’s covenants, condition, and restrictions.
The community has a combined fire and police station located on site on ten acres (four hectares) donated by thedeveloper. Anthem also features an on-site water treatment plant, which includes a wastewater treatment system that recycles water for irrigation purposes, and several sites for houses of worship.
EXPERIENCE GAINED
Because Anthem is built as a small city, Del Webb needed to incorporate almost all aspects of daily life into theproject’s master plan—schools, a fire/police station, a large central park, a community center, and a grocery store.The company used a combination of luxurious amenities, affordable homes, and a multigenerational focus to reach abroad market and deliver a live/work/play lifestyle. Having underestimated Anthem’s popularity, the company soldnearly every lot it had planned to release for the year within the first eight weeks of opening. On average, 1,000 unitsare sold annually, which is almost double the number that was projected.
Del Webb was aware that building Anthem would enrage existing residents who had moved 35 miles (56.3kilometers) outside of Phoenix to escape the populated area. However, the company managed to satisfy neighbors with extensive planning, setting aside 2,100 acres (850 hectares) of open space, donating $18 million to the local school district, and paying for the infrastructure in order not to burden taxpayers.
The members of the development team learned through their work at Anthem that they could not socially engineerresidents’ lives. They could provide the framework, but had to leave it up to the residents to breathe life into thecommunity. The team built infrastructure that it believed would be used by both kids and adults, expecting the largefitness center, with its numerous cardiovascular machines and free weights, to be the most popular amenity atAnthem. Although parents and children do use the amenities, more emphasis was placed on organizing activities forkids, such as little league teams and swim clubs. This has taught the development team that it is impossible to predicthow residents will respond to an amenity.
Anthem led the way for development in the area. Three other housing developments followed Del Webb’s lead,causing the northwest corridor running along Interstate 17 to be considered by homebuilding analysts as the next hotspot for new homes. As a testament to the company’s work, Anthem’s residents’ level of satisfaction with thecommunity and its amenities stands at 97 percent, as indicated through customer satisfaction surveys.
PROJECT DATA
LAND USE INFORMATION
Site area (acres/hectares): 5,880/2,377Total dwelling units planned/completed: 10,500–12,000/4,600Gross density (per acre/hectare): 2.05/5.04
LAND USE PLAN
Use Acres/Hectares Percentage of Site
Detached residential 2,242/907 38
Attached/multifamily residential 15/6 0.2
Retail/commercial 34/13.7 0.5
Office/industrial 40/16 0.6
Golf course 314/127 5.3
Roads 896/362 15
Common open space 1,836/743 31
Commercial 300/121 5
Other 29/11.7 0.4
School 130/52.6 2.2
Worship 44/17.8 0.7
Total 5,880/2,377 100.0
RESIDENTIAL UNIT INFORMATION
Unit TypeLot Size (Square Feet/Square Meters) Number of Units Planned
Detached 4,386/407 188
Detached 4,950/460 2,378
Detached 5,175/480 997
Detached 5,500/510 1,216
Detached 5,750/534 717
Detached 6,325/587 348
Detached 6,900/641 566
Detached 8,050/748 2,123
Detached 9,600/891 186
Detached 10,000/929 635
Detached 9,775/908 282
Detached 10,625/987 398
Detached 11,400/1,059 242
Detached 11,875/1,103 120
Detached 12,500/1,161 452
Detached 13,650/1,268 95
Attached N/A 1,057
Total 12,000
RETAIL INFORMATION
Tenant Classification Number of StoresTotal GLA(Square Feet/Square Meters)
Food service 19 24,000/2,229
Home furnishings 3 5,700/529
Home improvement 4 32,500/3,019
Hobby/special interest 7 20,300/1,885
Gift/specialty 5 7,100/659
Drugs 1 1,500/139
Personal services 22 33,500/3,112
Financial 3 11,200/1,040
Automotive supplies and services 3 14,000/1,300
Total 65 149,800/13,916
DEVELOPMENT COST INFORMATION
Site Acquisition Cost: $15,000,000
Site Improvement CostsExcavation/grading: $55,000,000Sewer/water/drainage: $200,000,000Paving/curbs/sidewalks: $90,000,000Landscaping/irrigation: $135,000,000Fees/general conditions: $30,000,000Total: $510,000,000
Construction CostsOther: $50,000,000Total: $50,000,000
Construction CostsResidential: $1,440,000,000Total: $1,400,000,000
Total Development Cost Expected at Buildout: $1,734,000,000
DEVELOPMENT SCHEDULE
Site purchased: 1991Planning started: 1995 Construction started: February 1998 Sales started: February 1999 First closing: July 1999Project completion date: 2007
DIRECTIONS
From Phoenix Sky Harbor International Airport: Take I-10 west to I-17 north for approximately 25 miles (40 kilometers) to the Anthem Way exit.
Driving time: 30 minutes in nonpeak traffic.
Alisa Rosenbaum, report authorLeslie Holst, editor, Development Case StudiesDavid James Rose, copy editorJoanne Nanez, online production manager
This Development Case Study is intended as a resource for subscribers in improving the quality of future projects. Data containedherein were made available by the project's development team and constitute a report on, not an endorsement of, the project byULI–the Urban Land Institute.
Anthem is a 5,860-acre (2,371-hectare) master-planned community located in the North Valley of phoenix, Arizona.
The Big Splash Water park contains over 400,000 gallons (1.5 million liters) of water that flows through this aquatic playground that surrounds two water slides and includes amenities such as a beach-entry leisure pool, a tot pool, a
25-meter eight-lane lap pool, and a diving tank.
The community also features the 34,000- square-foot (3,185-square-meter) Anthem Golf and Country Club, which is oneof the few private clubs in Arizona that offers 36 holes of championship golf. Shown here is hole 17.
Homes overlooking the golf course and clubhouse.
Cacti and plants that needed to be removed to make way for streets and houses were replanted in road medians or in on-site nurseries. Extensive paths and trails serve as important links throughout the community, connecting all
neighborhoods and social areas and allowing for equestrian access, hiking, and other uses.
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