Executive Summary

The Ranch at Tombstone

Cochise County, Arizona

Property Description:

Cochise County Land, LLC (CCL) owns a development project called  The Ranch at Tombstone. The property consists of 1,315 acres with an average elevation of 4,300’. The property is located 6 miles south of the historic town of Tombstone; 12 miles northwest of Bisbee; and is approximately 20 miles to the larger community of Sierra Vista. The combined population of the greater Sierra Vista area is approximately 75,000. The subject property is situated one mile west of Highway 80.

The Ranch at Tombstone is expected to accommodate approximately 500 +/- homes. Majestic Skies and Legendary Trails are the first two subdivisions within the project.  Both are conservation subdivisions, meaning they average one home per three acres. Phase One consists of 367.19 acres and will accommodate 115 homes.  Pathways for walking, jogging, and bicycle riding, will meander throughout the subdivisions.

The planned equestrian center will have all the facilities needed to care for both private and community-owned horses, such as an arena, round pens, corrals, as well as exercise equipment for training. Stable facilities will have wash-down areas, tack room, and a lounge where friends and neighbors can gather. The stables will be operated by the Master Homeowner’s Association (the “Master Association”). An experienced cowboy will be on hand to make the equestrian experience both easy and enjoyable.  Trail rides will be available in and around the 7,000 acres of land CCL has under lease from the Arizona State Land Department. There will be trails leading to the San Pedro River Preserve, as well as to the “Old West” town of Tombstone. The equestrian area will be designed to allow for a possible dude ranch with bunk house accommodation.

The equestrian center will serve as one of the project’s amenities, and will also provide a source of income to the Master Association.  Other project attractions will include a “catch and release” fishing pond; habitat refuge areas; community building; amphitheater; horseshoe pits; general store with deli, and a separate BMX bicycle track.  

The Ranch at Tombstone is designed as a LEED development. In the belief that developments offering features in sustainable living will have an ever-growing appeal to future home buyers wanting to green, the Ranch at Tombstone incorporates the following:
● Water Company: A cost-efficient solar water system has been designed and will be owned and operated by the Master Association. It will be totally “off the grid”. This will be one of the first master planned communities with its own solar powered water utility. Energy for its operation will be provided at no cost by the Arizona sun. The only ongoing expense will be for that of routine and deferred maintenance.

 ● Solar Garden: A community solar garden will be constructed in a separate area of the project. For ease of maintenance and to maximize efficiency the solar panels will be ground-set. The solar garden will provide not only a utility and functional value, but will serve to enhance the project from an aesthetic standpoint as there will be no need for unsightly panels mounted upon rooftops where they are difficult to maintain. The solar garden will be owned and operated by the Master Association with the aim of providing low cost and sustainable energy to residents.

● Landscape: Nature has provided The Ranch at Tombstone with abundant landscape. Throughout the development care will be taken to preserve as much of the native landscape as possible. Residents will be encouraged to preserve the natural landscape as well, and to make use of indigenous plants and trees for landscaping, thereby keeping water usage to a minimum.

Acquisition & Entitlement Stage:

At present there is a loan on the property in the amount of $3,000,000. To date the developer has invested approximately $700,000 in land planning, engineering, topography, water system design, two new wells, soil work, geotechnical analysis, percolation testing, construction drawings for 115 residential lots, and a grade and drainage study for the entire 1,315 acres.  A traffic analysis has also been completed for ingress/egress from Highway 80. 

The Cochise County Board of Supervisors has approved the tentative plats for Legendary Trails (50 lots) and Majestic Skies (65 lots). The Board of Supervisors has also approved the newly formed Keller Domestic Water District for the project’s domestic water system.  Lab testing for the water from the two new wells has been completed, and the Arizona Department of Water Resources (ADWR) has determined that 305.60 acre-feet per year of ground water will be physically and continuously available for the project. Design for fire supply and domestic storage needs have been completed.  A 160,000 gallon water storage tank will be part of the water district system and will be capable of supplying a two-hour fire flow.

The 7x Fire District has been formed for the project and approved by the Cochise County Board of Supervisors.

The property is currently provided with single-phase electricity by the Sulphur Springs Valley Electric Cooperative.  However, three-phase electricity will eventually be required for the project. To achieve this, a new electrical easement has been established and is currently under review by Sulphur Springs Valley Electric, the Arizona Land Department, and a nearby property owner. The developer has been working to take this project to net-zero utility cost.

Joint Venture Proposal:

The Developer is currently seeking a joint venture partner to provide $3,100,000 for a negotiable interest. A priority position will be given to the JV partner for the return of his capital. The funds provided by the JV partner will be used to retire the existing debt on the property and to complete the few remaining requirements to make the project “shovel ready.”

The JV partner and Cochise County Land will form a new company which will explore the necessary financing arrangements to begin Phase One of the project starting with 34 lots. Construction costs by the developer’s engineer are estimated at $2,800,000. Proceeds from the sale of lots shall go toward the retirement of the construction loan and / or roll over to the next phase. The JV capital shall be secured by both finished and platted lots, as well as the remaining undeveloped land. Phase One will carry the greater cost of a new water district, power extension and the new access entrance road off Highway 80. Once the first 115 lots have been sold and the construction debt retired, the Company will have approximately $825,000 in working capital (less interest carry and marketing).

Alternative

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the attached Excel worksheet provides cost and sales for the first 34 lots with the average sales price of $65,000 per lot. You will note this first phase of 115 lots pays down the existing loan of $780,000 and $3,625,000 in cash based on the current loan remaining in place as an alternative. The current loan may possibly be extended out for another 24-months based on lender’s approval. If that were to transpire the JV funds would be used for development funds.

The remaining 948 acres is valued at $10,000 per acre, equaling $9,480,000. The remaining 948 acres should yield a minimum of 400 lots, providing a net value of $30,000 per lot, equating to $12,030,000 (with no lot value increase). Based on an $85,000 average value, this would equal $20,050,000.

Alan E. Thome
Cochise County Land, LLC
480-390-9990
Sunburst Properties, Inc.
480-897-2020