Buyer Interest Rises in Land Overlooked as ABQ Boomed
By Richard Metcalf
Journal Staff Writer
An extensive patchwork of land parcels for sale in the upper South Valley, east of the Rio Grande, is seeing stepped-up buyer interest that could signal change for the long-overlooked area.
"Growth is going to move back south," predicted Tim MacEachen of Grubb & Ellis New Mexico.
Sales are pending on five of 21 parcels— representing a total of about 500 acres— on the market by Schwartzman Properties Inc., which is tied to an old South Valley family, he said. The parcels have been on the market for years.
The area has largely been ignored while the rest of the metro area has seen phenomenal growth. Developers looking south have regularly leapfrogged over the South Valley for locations in Valencia County.
The new interest is fueled in part by one of the biggest projects in the Albuquerque metro area's history.
The giant planned development Mesa del Sol has started to go up on the other side of Interstate 25. The 12,900-acre project by Forest City Covington will be a mix of uses developed over 30 years. Projections call for 35,000 homes and 100,000 residents.
"I think Mesa del Sol will have an impact in changing perceptions of the South Valley," said Jim Chynoweth of CB Richard Ellis, listing agent for Mesa del Sol. "I think one of Schwartzman's challenges has been overcoming the stigma of the South Valley."
The stigma is based on past and present land uses identified in a draft of Bernalillo County's Mountain View Sector Development Plan, which covers the South Valley east of the river.
Ground contamination from past industrial activity polluted large tracts, thus discouraging land investment because of potential clean-up costs.
"The South Valley has gotten a bum rap in recent years and a lot of people would say it's unjustified," said Alfred Volden, president of Schwartzman Inc.
Concerning environmental issues at some sites, he said, "Responsible parties have done their part to restore the property."
In addition, existing land uses include junkyards that are ugly to look at and could pose a health hazard.
But what the draft sector plan calls "the most pressing issue"— extensive zoning for manufacturing— is likely what is attracting the interest of investors and developers.
"The manufacturing zone allows heavy manufacturing uses such as foundries, but it also allows lighter uses such as offices, call centers, warehouse and distribution centers," said Karen Marcotte of Consensus Planning. "It's very useful for economic development purposes."
From the standpoint of land investment, said Brad Allen of Roger Cox & Associates, "When you buy in the valley, your options are open."
Interest in the South Valley east of the river is also driven by the metro's shrinking supply of vacant land, especially if it is zoned for industrial uses.
"Land in general is a hot play right now," said Bill Robertson of Grubb & Ellis. "It's especially hard to find industrial land in Albuquerque."
As the supply of vacant land elsewhere dwindles or becomes too expensive for industrial uses— typically fabrication or distribution— investors and developers will be almost forced to look at the South Valley, Marcotte said.
In the past, "rather than deal with potentially cleaning up a site or looking at an unattractive land use nearby, it was easier to go elsewhere," she said. "Now those choices are largely gone."
When you add in interstate access, existing railroad lines and proximity to nearby Albuquerque International Sunport, Marcotte said, "That area is really ripe for development."
Excitement was generated in 2000 when the U.S. Postal Service purchased 43 acres of Schwartzman land for a regional processing center.
"We expected then that it would be the feather in the cap to get this area going," said Robertson, who was involved in the sale.
There was talk of a 600-acre mixed-use development on Schwartzman land patterned after the North I-25 corridor.
But the momentum faded when the Postal Service put its plan for the 400,000-square-foot mail processing plant on indefinite hold in early 2002.
The new wave of buyer interest comes from a diverse group of investors and potential users, said MacEachen, who has marketed the Schwartzman land in the past.
A residential land developer has nearly 200 acres of Schwartzman land under contract between South Second Street and the Rio Grande, north of Rio Bravo, he said.
"For a quality residential subdivision, it's a beautiful property, especially sitting along the river with a bike path," MacEachen said.
The 500 acres on the market represent the last of the Schwartzman family holdings, which were more than 1,000 acres as recently as the mid 1980s.
The family, which arrived in Albuquerque in the late 1880s, established a meat-packing operation in the upper South Valley that Volden described as "vertically integrated."
Crops were grown to feed cattle that were raised on-site and butchered to feed Albuquerque's expanding population. The operation closed in the early 1980s, Volden said.
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