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Luxury homebuilder Geoffrey Edmunds predicts a high rise, upscale future for Phoenix core

Luxury homebuilder Geoffrey Edmunds says the Phoenix market is suffering from a troika of price correction, financing troubles and oversupply — and has yet to hit bottom. But when it recovers, the market will look different, he says. People will be less interested in developments flung out into the desert, and more attracted to the core — inside the Route 101 loop. Many will be looking for what he calls "custom homes in a vertical configuration." Edmunds, who was inducted into the W. P. Carey School's Hall of Fame this fall, helped bring that style of living to Phoenix and California.

2008-12-17

A tiny piece of land occupied by two tennis courts in Phoenix was the starting point for a new career for luxury homebuilder Geoffrey Edmunds and a new chapter in urban living in Arizona and California. It all came together in 1999. Up to that time, Edmunds, then 62, was retired. He and his wife Jane were enjoying the Pacific Ocean sunsets from their new summer getaway, a luxury high-rise condominium in Coronado, California.

Edmunds had sold his homebuilding company a few years earlier, and he was doing consulting work on a La Jolla project for Scottsdale-based Troon Cos. One day, he received an unexpected call from a friend, Francis Najafi of Pivotal Group. "Pivotal brought me out of retirement," Edmunds says, recalling the phone call that sparked his new career. "Francis Najafi called my wife. He says, 'Well, is Geoff ready to come out of retirement yet?' She says, 'I think he is.'"

Najafi met with Edmunds and showed him a concept new to Arizona. He had designs for a 12-story luxury condominium building on the land occupied by two tennis courts next to the Ritz-Carlton Phoenix hotel at 24th Street and Camelback Road. The condos, to be called Esplanade Place, would offer security, valet services, a pool and barbecue area on the roof, and 24/7 concierge services.

Edmunds saw the concept as a right-place, right-time decision. He already had a string of business successes under his belt, and now he was handed the chance at another one. Edmunds says that as he listened to Najafi, he remembers thinking that it would work because the metro Phoenix market in 1999 was ready for vertical luxury living.

The subsequent Edmunds-Pivotal partnership not only launched a new career for Edmunds — it opened a new chapter in luxury living in Arizona. Edmunds calls it "custom homes in a vertical configuration." Since the popularity of Esplanade Place, the concept has been used by Edmunds and Opus West at Scottsdale Waterfront and by several other developers who have added their own high-rise luxury residential buildings to the metro Phoenix mix.

And today, high-rise luxury residential is part of the design that Edmunds is adding to RED Development's mixed-use CityScape development in downtown Phoenix, and the designs that Edmunds and Opus West are creating in their luxury residential buildings in Southern California. "It all started with Esplanade (Place)," Edmunds says, who was inducted into the W. P. Carey School's Hall of Fame this fall. "If we hadn't done Esplanade, obviously we'd never have done the ones after that. Esplanade Place changed the way people lived."

Dreams of pro sports, then FBI

Edmunds has been at full throttle as long as he can remember. He was born on the Fourth of July, 1939, in Sioux Falls, S.D. When he was about 12, he longed to become a pro athlete. Basketball, baseball or football, it didn't matter. "Then when I was in high school, I wanted to be an FBI agent," he says. "And then when I was a senior in high school, I wanted to be an accountant."

After high school, Edmunds entered the University of Denver and began studying accounting. He later transferred to ASU, where he started working in homebuilding while finishing his accounting degree. He graduated in 1963. In 1971, Edmunds and Jerry Murphree formed Murphree-Edmunds Inc., a company that over the next six years designed and built more than 100 custom homes. They also built office buildings, warehouses, retail stores, apartment complexes and a 150-room Sheraton hotel.

In 1977, Edmunds formed Geoffrey H. Edmunds & Associates, a family business that designed and constructed luxury town homes and custom homes in Scottsdale and Paradise Valley. He sold the company in 1995 to Toll Brothers Inc. a major national luxury homebuilder.

Edmunds was president of Toll's southwestern division until 1998, when he started a new company — GHE & Associates — and returned to the luxury homebuilding market. He also began a consulting business with developers of master-planned communities and urban developments. He has since resumed using his earlier corporate name, Geoffrey H. Edmunds & Associates Inc.

Edmunds forged luxury residential partnerships, first with Pivotal Group, followed by Opus West and then RED Development. And of all his work in custom residential designs, the high-rise luxury residential building likely to become part of his legacy in Arizona. Edmunds says he and Najafi were surprised at the popularity of Esplanade Place, partly because of its price and because it was a design new to Arizona.

But in 16 months, all 56 residences were sold at prices ranging from $600,000 to $2.75 million. "We had a theory that there was a group of people wanting to move out of their single-family home in Paradise Valley, and get rid of their one acre of maintenance and get into a maintenance-free building in a lifestyle where they could have security, valet parking, concierge, all these services and not have anything to maintain," Edmunds says.

"We came up with that theory and obviously we were right on."

— Geoffrey Edmunds, luxury homebuilder

Construction started in mid-2001. On Jan. 15, 2003, although not quite finished, Esplanade Place was opened to the public for an evening tour. Arriving guests were greeted by a string quartet and helpings of shrimp and hors d'oeuvres. But on the roof, beyond the pool and barbecue, was the project's crowning touch — the high-rise view of sparkling city lights stretching to the horizon and a brilliant sunset.

One of the guests at the grand opening was Dr. Art Mollen, founder and president of Southwest Health Clinic. Mollen's comments that night were prophetic. "This is going to be a great project for Phoenix now and in the future," Mollen told a reporter from The Phoenix Business Journal. "It will probably be the tip of the iceberg for more of this type of projects."

Other guests included a developer of a new mixed-used development planned in Tempe and an attorney representing Scottsdale Waterfront. They said the popularity of Esplanade Place fueled their commitments to their mixed-used projects, which included vertical luxury residential units that in 2001 were about five years from completion.

Edmunds designed the residential component of Scottsdale Waterfront, where Opus West broke ground for the project's two, 13-story residential towers in 2004. When the first of the two towers was completed in 2006, all but 15 of the luxury condos were sold.

The success of Esplanade Place, after smashing all the old concepts of luxury residences, caught the attention of developers and architects in other metro regions, specifically Chicago and Houston. Ultimately, after Esplanade Place was completed, those developers added their own vertical luxury residential buildings in metro Phoenix.

Today, the designs of Esplanade Place are part of the DNA for the Scottsdale Waterfront, The Plaza Irvine and 3000 The Plaza — joint ventures of Edmunds and Opus West that created luxury high-rise buildings in Scottsdale, Arizona and in Irvine, California. The Scottsdale Waterfront sold out of all 198 residences. Edmunds says 200 of the 202 units have been sold in The Plaza Irvine. Nearby is a third Edmunds-Opus West building, called 300 The Plaza containing 105 luxury units.

Urban living popular

For the future of metro Phoenix, Edmunds sees a growing interest in urban living within the Loop 101 as well as declining interest in suburban developments planted in former cotton fields miles from the metro region's employment centers. Edmunds says today's metro Phoenix real estate market is struggling through a price correction, financing troubles and an oversupply problem. "It has all three of those issues, which is more than it's had, historically," he says.

He also believes, like others in his industry, that metro Phoenix's residential real estate market hasn't yet hit bottom. "I think the bottom is going to be in 2009. A year ago, I think we all thought it was going to be in January (2009)." He, like others, now believe the Arizona real estate market will hit bottom in the second half of 2009. "The key is, we've got to get rid of the foreclosures and the existing inventory (of new and resale houses for sale)." Other factors sparking change are fuel prices, the overall economic picture and objections to commute times.

"They're going to bring the near-future marketplace to the area I call inside the 101 loop," he says. "It's going to make our marketplace smaller. "People are not going to want to drive as much," Edmunds continues. "The price of fuel has really made people think about how much they should use a car and what kind of a car they should drive." He adds that the major projects completed or under way in downtown Phoenix are changing the city's landscape.

ASU is expanding its downtown campus, the newest phase of the expanded Phoenix Convention Center is scheduled to open in January 2009, the Translational Genomics Research Institute is in place, and the new Sheraton Downtown Phoenix is open. "I tell people, 'Now's the time to go to downtown Phoenix,'" Edmunds says. "There's been a lot of improvements in downtown Phoenix. It's moving in a different direction."

Market is evolving

Metro Phoenix is a market in constant transition, he says. The region will continue growing, partly because of its weather. At the same time, its housing market is evolving. Future generations of homebuyers are expected to show more interest in high-density residences closer to work than in traditional single-family homes at the end of a long commute.

"A lot of young professionals really don't have a desire to live in a house," Edmunds says. "They like the ability to work and live in a more urban setting than we did. A lot of them are single. A lot of them are married couples, but they don't have kids. Although he has a new career going strong, Edmunds makes time for traveling. And wherever Edmunds travels, he always scouts the local development landscape, taking notes about any new projects he discovers, and analyzing their designs.

Birthdays are important to Edmunds. For the past 10 years, he and Jane invite their families and friends to their Coronado condo to celebrate his birthday. Edmunds often jokes with new employees that, in addition to the regular list of holidays, they will get his birthday as an extra day off. When he tells them his birthday is July 4th, which is a national holiday, they share the humor.

"We work hard and we have fun," Edmunds says. "Even in a bad market, you've got to smile and give thanks. The key to success is to beat your competition. If you can beat your competition, you'll be successful." While some developers are running aground in a challenging economy, Edmunds is thankful that his company remains successful. "Every year's been profitable," he says, knocking on his wooden table. "We haven't got this one sewn up yet, but this one's the most challenging. It's a real test to see if you can make money in a bad economy."

Bottom line

• Edmunds was heading into retirement in Coronado, Calif., when a friend called about a new concept in luxury living. Their partnership brought Edmunds out of retirement and helped change the look of custom residences in Arizona and California.
• Rising fuel prices will help change the design of future residential developments in metro Phoenix.
• Edmunds scouts for new designs in residential development wherever he travels.
• When he was in high school, Edmunds considered becoming an FBI agent.

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