Grand Canyon Times

Phoenix-area developer Brent Hickey is asking House Speaker Rusty Bowers to step in after accusing the Arizona State Land Department (ASLD) of structuring a state auction to limit competition on a massive 2,783-acre parcel of land located south of Apache Junction.

In a letter to Bowers, Hickey said the State Trust Land auction terms for an Oct. 20 auction were obviously made with a preferred developer in mind. 

Brookfield Residential is a massive land developer with assets of at least $4.5 billion. 

Arizona Capital Media reported that Brookfield requested the land be put up for sale.

“This certainly has the appearance of being something that was worked on together,” Hickey told the Grand Canyon Times. “The conditions of the bid make it look like they structured this deal just for Brookfield.” 

Among the terms for the auction are that the winning bidder must have $400 million in net worth and a track record showing they have developed 1,000 acres and 2,000 residential units. This greatly limits the possible bidders to only a few of the largest developers in the entire country, including Brookfield. 

The state is expected to see revenues of over $417 million from the land sale. However, Hickey said if the deal were structured differently the state could possibly realize $300 million more in income. 

Proceeds from ASLD land auctions go to benefit public schools. 

“There is no doubt that the structure proposed for this land auction will result in hundreds of millions less to the state's education system when compared to a more prudent sale of smaller parcels with numerous bidders,” Hickey said in the letter. 

Hickey is calling on the auction to be set aside and be restructured to allow for more competition in the bidding process.  

“The biggest benefit to the state is there is no appearance that the state is in bed with Brookfield,” Hickey said. “I think it would serve everyone well to know that in these different times.” 

Hickey and other developers who do not fit the requirements of the bid met with Bowers and ASLD Commissioner Lisa Atkins, who told them the ASLD was undertaking an experiment in which they would realize profits through a joint agreement in which the state sees income with each land sale. The state would see all profits from the sale in a 25-year period. 

Delaying profits and limiting the land sale to bidders meeting specific conditions does not make sense to Hickey. He said others who were at the meeting are not being as outspoken on the issue for fear they will not receive contracts from Brookfield. 

“There were a half a dozen others like me that would bid if it weren’t so restrictive,” he said. “There were big homebuilders there. Their fear is if Brookfield blacklists them, they won’t be able to develop lots there if Brookfield comes out against them.”  

According to Hickey, Atkins told the group that in the past they had to foreclose on smaller developers and they were hoping to deal with larger developers due to higher foreclosure rates among smaller developers. 

“I don’t have a bone to pick with Brookfield,” Hickey said.”They just convinced the state to do something I disagree with.”  

The auction was previously scheduled for Aug. 20 but was postponed. 

Bowers did not respond to an interview request from the Grand Canyon Times prior to publication.