A whole district of short-term rentals? | New

In what may be the first in Arizona, a California developer plans to buy 144 single-family homes in the Southeast Mesa community of Eastmark to create a neighborhood for short-term rentals.

Visit Mesa CEO Marc Garcia briefed the city’s Economic Development Advisory Board on the potential project earlier this month.

Visit Mesa is the city’s official tourism marketing organization that is partially funded by bed taxes collected from hotels and short-term rentals.

Garcia was talking about the prospects for new housing in Mesa when he mentioned the proposed short-term rental neighborhood,

He said a “California-based company with some representation here in the Valley” wants 144 homes in Eastmark to establish “a whole neighborhood of short-term rentals.”

He told the board he had a meeting scheduled for this month with the company, but a spokeswoman for Visit Mesa declined to provide further details.

Although the developer in question hasn’t signed any deals yet, Garcia said, the company is “pretty serious.”

At the current median selling price of $625,000 for homes in Eastmark on Realtor.com, a 144-home transaction would cost $90 million.

A spokeswoman for Eastmark Development Group said. “No one has recently approached Brookfield/Eastmark Developers to inquire about land available for short term rental. All of Eastmark’s remaining residential plots have already been sold to builders. Nothing is left.”

She also said current CC&R restrictions at Eastmark require a minimum lease of 180 days.

Under Arizona law, a willing homebuilder could sell parcels of new homes to an investor for use as short-term rentals, and city planners could do nothing about it.

“Cities cannot prohibit a person from buying or using property as a short-term rental,” a spokeswoman for the Mesa City Attorney said.

This has frustrated some cities and towns in Arizona, such as Scottsdale and Sedona, which feel their limited labor housing and quiet neighborhoods are compromised by demand for short-term rentals.

Opponents of transitional rentals have argued that converting a home to a short-term rental essentially puts commercial properties in the middle of a residential neighborhood.

Some Arizona cities have lobbied the legislature to give municipalities the power to create rules guiding where short-term rentals can be located, but so far the powers given to cities have not been enough. .

Other reviews call for short-term rentals to be regulated as businesses, but currently the city’s zoning laws cannot distinguish between a home used for transient lodging and a home occupied long-term. term.

For example, cities cannot require rentals to have more parking spaces than an owner-occupied home.

The Legislature’s latest short-term rentals bill, signed by Gov. Doug Ducey in July, gave cities half a dozen new powers to regulate rentals.

It prevents them from being used as sober homes or as sets for pornographic films and requires the owner to provide contact information to respond to complaints and emergencies.

It also allows municipalities to require permits and licenses and to require landlords to notify neighbors of the property’s use as a short-term rental.

The law goes into effect Sept. 22, and the Mesa City Attorney plans to present the city council with a short-term rental ordinance that aligns with the rules of the new legislation.

Garcia said a short-term rental neighborhood would benefit the city by quickly increasing Mesa’s housing stock where it’s needed and increasing the city’s average nightly rates because single-family home rates are ” much higher than hotel rates.

Southeast Mesa needs more accommodations for visitors, Garcia said, as demand for accommodations is expected to increase from the Bell Bank Park sports complex, Cannon Beach and other new or planned attractions.

The booming industrial sector may also create short-term rental demand from temporary workers in town to help set up new data centers and other operations.

Garcia said the idea of ​​bundling short-term rentals could be a win-win for tourism businesses and Mesa neighbors.

“You have heard or read in the news about the concern many people have about short term rentals, noise, parties and things of that nature. So the solution for this developer is ‘we will locate them all in one area’, so they don’t impact the residents who live there 365 days a year,” Garcia said.

Councilor Kevin Thompson, who represents Eastmark, had heard nothing of the project when contacted last week by his assistant Alicia White in an email.

“He will now pursue this matter further and have the appropriate discussions with Eastmark,” she wrote.

Garcia’s description of the idea of ​​a short-term rentals neighborhood in Eastmark caused a murmur within the council.

Board Chairman Rich Adams and another member wanted to know if the short-term neighborhood idea had been tried elsewhere in the country and if houses used for transient accommodation had to pay the same taxes as hotels.

Garcia wasn’t sure the idea had been tried, but he assured the board that short-term rentals now had to pay the same taxes as hotels.

“They pay 5.5% (state) sales tax…they pay 1.77% county and they pay 5% (transient lodging tax) to the city of Mesa, plus the 2% (transaction privilege. tax) in the city of Mesa,” Garcia said.

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