November/December 2021 Apartment News

NOVEMBER/ DECEMBER 2021 The official publication of the Arizona Multihousing Association

State of the Industry

Despite challenges, Arizona’s apartment industry weathered numerous storms in 2021; will 2022 bring calmer waters? page 6

Legally Speaking

Legislative Update

New Tucson Leadership

The landscape in the industry continues to change.

Housing affordability will be key topic in 2022.

Linda Morales named new Tucson Area Association Executive.

Page 18

Page 24

Page 14

Goals are made to be achieved, I hope I accomplished that goal

818 N. 1st St., Phoenix, AZ 85004 phone: 602-296-6200 fax: 602-296-6178 web: azmultihousing.org 2021 AMA BOARD OF DIRECTORS

Dustin Lacey Mark-Taylor Residential

EXECUTIVE COMMITTEE Chair, Reid Butler Butler Housing Company

Pam McCarthy Fairfield Residential

Vice Chair, Scott Hines PEM Real Estate Group

When I took over from Kim Pacheco as 2021 Board Chair in January, I set some ambitious goals. With support from AMA members and

Treasurer, Linda Coburn NexMetro Development

leadership, we achieved them.

Secretary, Tina Schreiber Greystar Real Estate Partners

AMA continued to provide leadership

Imm. Past Chair, Kim Pacheco Scotia Group Management

for Arizona business and government.

AMC Exec., Sue Campbell Redi Carpet

We remained the “go-to” voice for Arizona housing issues. In 2021, we faced

Gloria Munoz Maricopa County Housing

John Rials Western Wealth Capital

Mark Schilling MEB Management Services

Lesley Brice MC Residential

Christine Shipley Dunlap & Magee

Dahnn Brown Camden Property Trust

Michelle Sinclair Evergeen Devco, Inc.

Luz Bruscini MEB Management Services

Justin Steltenpohl P.B. Bell Companies

John Carlson Mark-Taylor Residential

Greg Stobart MG Properties

Crystal DeHoag Bella Investment Group

Peter TeKampe Marcus & Milichap

Anna DiSabato Dunlap & Magee

Dallin Tippets Rainforest Plumbing & Air

Kohl Eisenhour Avenue 5 Residential

Kris Tomlinson Cushman & Wakefield

Kimberly Fitch Nicolosi & Fitch, Inc.

David Vanek Greystar Real Estate Partners

Adam Greco Burns Pest Elimination

Luis Verger Shelton Residential

Kristin Heiple Baron Property Services

Christopher Walker Law Offices of Scott Clark

Robert Hicks Greystar Real Estate Partners

Wendy Weiske Gorman & Company

the state’s apartment industry.

Stacey Hogue Greystar Real Estate Partners

Debbie Willis P.B. Bell Companies

I am in my fifth decade in the industry (from the 1980s to the 2020s).

Khara House Bella Investment Group

Nicole Wray Greystar Real Estate Partners

Michelle Howland Blue Steel Security Services

Chris Worrell GPM Landscape, Inc.

David Kotin Kay-Kay Realty

Mark Zinman Zona Law Group

the eviction moratorium (and risks

Reid Butler AMA Board Chair

of broader government intervention), and heightened community debates

about the positive and negative impacts of new housing development projects (to name a few of the key challenges this past year).

As I hand the wheel of Board Chair over to Scott Hines for 2022, I thank you for giving me the opportunity to serve you in 2021.”

AMA members also helped move the organization forward with an eye to the future, something they have done as it enters its 55th year in 2022. We are and must continue to be the voice and advocate for

As your Board Chair, and unofficial AMA “historian,” one goal was to provide that bridge from our past as we look to the future of the industry. And the numbers continue to show it is a vibrant industry

Melissa Lanouette Events & Education Manager mlanouette@azmultihousing.org Phone: 602-296-6205 Lisa Garcia Membership & Operations Coordinator lgarcia@azmultihousing.org Phone: 602-296-6207 Charnissa Moore Membership & Business Development Manager cmoore@azmultihousing.org 602-296-6208 Amanda Perkumas Tucson Area Executive Assistant aperkumas@azmultihousing.org Phone: 602-742-2616 Jonathan Baldenegro Events & Education Coordinator jbaldenegro@azmultihousing.org Phone: 602-296-6209 Christina Desaubin Communications & Marketing Manager cdesaubin@azmultihousing.org Phone: 602-296-6204 Jenica Hickey Member Relations Coordinator jhickey@azmultihousing.org Phone: 602-296-6214

Sharon Kuhlman Shelton Residential

in one of the fastest growing states in the U.S. In my Board Chair letter when I took the reins, I suggested that “pre-

AMA CONTRACTORS

paring for our future will require us to innovate, invent, mentor and

CAPITOL CONSULTING GOVERNMENT RELATIONS Courtney LeVinus Government Affairs Consultant courtney@azcapitolconsulting.com Phone: 602-712-1121

build partnerships. As demographics continue to change in Arizona, we will be a multi-generational and high-value association.”

This is true now more than ever.

Jake Hinman Government Affairs Consultant jake@azcapitolconsulting.com Phone: 602-712-1121

–Continued on page 5

Apartment News | November/December 2021

Kyle Simplot Accounting & Operations Manager kyles@azmultihousing.org Phone: 602-296-6203

Lisa Rosenfeld HSL Asset Management

Crystal Sevilla Weidner Apartment Homes

industry partners and AMA members,

Linda Morales Tucson Area Association Executive lmorales@azmultihousing.org Phone: 520-323-0643

Lisa Osborn-Warne Priderock Capital Partners

Krisanne Beckstead Picerne Real Estate Group

impact on our residents, employees,

Sarah Fluke Deputy Director sfluke@azmultihosusing.org Phone: 602-296-6212

April Morris Cox Communications

Stacey Searl Weidner Apartment Homes

the continued COVID-19 pandemic

Courtney Gilstrap LeVinus President and CEO clevinus@azmultihousing.org Phone: 602-296-6200

Omar Mireles HSL Asset Management

BOARD OF DIRECTORS Elizabeth Beaulieu Quarterpenny Management

many ongoing challenges, including

AMA STAFF

3

Bastien Andruet Municipal Lobbyist bastien@azcapitolconsulting.com Phone: 602-712-1121 GRAPHIC DESIGN James Dempsey Design james@jdempsey.com Phone: 602-510-5508

PUBLIC RELATIONS/ COMMUNICATIONS MadridMedia Peter Madrid Owner, MadridMedia ptmadrid1975@gmail.com Phone: 480-495-3762 Leibowitz Solo David Leibowitz Owner, Leibowitz Solo david@leibowitzsolo.com

azmultihousing.org

Change has been a good ‘partner’ for AMA members, leadership in 2021

AUGUST-SEPTEMBER 2021 NEW AMA MEMBERS

The adage “There is nothing permanent except

The AMA would like to welcome all new members from August and September. We are excited to work alongside you and to continue to make our association and industry the best.

change” pretty much sums up the past year for AMA members and its leadership.

Fortunately for us much of the

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change has been positive.

AMA emerged from the COVID-19

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pandemic a stronger and more

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cohesive organization. We learned to

Andrea Castilla & Ben Anderson Jerry Strebig Homegate Properties LLC

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Shelter Asset Management Urbanity Properties SJB Properties-Taylor Operations dba Pacana Apartments

change and adapt from how we used

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JMSred

to operate. We made modifications

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Pierce St. Triplex, LLC

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Stargate West LLC

that kept our education programs

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Madison Villas

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Array

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Xena Waste Valet

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and events going.

Courtney LeVinus AMA President & CEO

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The highlight of 2021 was seeing so many familiar faces at the 29th Annual AMA/Cox Communications

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Tribute Awards in August at the Fairmont Scottsdale Princess Resort.

That was a change of scene we really needed from 2020.

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As we look ahead to 2022, we anticipate more positive changes. There

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are two I would like to share with you.

Since 1966, we’ve called our regular members “Associates.” This fall we changed that moniker to “Industry Partners,” because that’s what they truly are – industry partners.

Tucson. We knew she couldn’t resist to continue her involvement

Villas Los Limones

P.R.O.S. Property Services

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Villas De Las Montana

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Four Peaks- Shelton Tides East Broadway Veranda Apartments

Landing

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Standard Interiors

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Securitas Security Services USA Industry Standard Fire Protection, LLC

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Posada Del Rio Apartments The Wyatt by Watermark Maguire Hill Apartments

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Airspeed Mechanical

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Veterans Singleply llc

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Bellevue Towers

Peterson Geotechnical Group

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University Commons

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The Benedictine

We welcome Linda Morales, who will lead the Tucson office. You will

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find a short bio on our new Tucson executive on Page 24.

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Another adage says, “Change is inevitable. Change is constant.”

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Change has also been a good thing at the AMA this past year.

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– Courtney LeVinus, President & CEO, Arizona Multihousing Association

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■

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with AMA.

iApartments

Activ Answer

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Equinox on Country Club

Greener Roofing Solution of Arizona

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herself become an Industry Partner.

Villas Del Paraiso LLC

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Lauren joins the leadership team at Avalanche Security Solutions in

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There is also a change of leadership in Tucson. Lauren Romero, who served us tremendously as Tucson Area Association Executive, will

Speed Pro Desert Valley

Cortland at Desert Ridge

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APS Take Charge AZ Sprague Pest Solutions Corporate

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The Michelle on Roosevelt

Comprehensive Managed Services Lanmor James Associates Management Equity Services LLC

ON THE COVER Grayson Place in Goodyear was one of numerous apartment communities that came online during 2021. P.B. Bell developed the project and has at least two more communities scheduled to open in 2022. (Photo by Michael Baxter) Apartment News | November/December 2021

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I also had specific and measurable goals, which we achieved as well.

We maintained our Better Government Fund and continued to engage our elected leaders.

I also noted AMA is all about our members, and said my goals were to focus on regular member engagement at events, education and on the committees. We came out of the COVID-19 pandemic and

AMA

held in-person events once again. This included the Tribute Awards,

Holiday Party

which were a huge success this year. Congratulations, again, to all the nominees and winners.

As I hand the wheel of Board Chair over to Scott Hines for 2022, I thank you giving me the opportunity to serve you in 2021. And I look

Join us to celebrate the end of 2021 and toast what we know will be a great 2022!

forward to my continued service to AMA and the housing industry on our Executive Committee and in our Government Affairs Committee

Thursday, December 2, 2021 4:00 PM - 6:30 PM Hyatt Regency Phoenix 122 North 2nd Street

and our Developer SubComittee in 2022 and beyond – hopefully into a sixth decade.

My deepest thanks for all your support.

– Reid Butler, AMA Board Chair, Butler Housing Company

Regular Members | Free *There is no cost for regular members to attend.

Bring your team and enjoy an afternoon of food, beverages and networking.

Industry Partners | Must Sponsor To Attend *Invite all your regular members to join you!

Register Now! https://www.azmultihousing.org/events/holiday-party

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Apartment News | November/December 2021

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azmultihousing.org

A year of resiliency Despite challenges, Arizona’s apartment industry weathered numerous storms in 2021; will 2022 bring calmer waters?

By Peter Madrid

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Labor shortages. Work disruption. Affordability.

have the income and the ability to make these rent payments. We are building a whole new class of renters. They have a higher profile

Virus variants. Eviction moratoriums. Land prices.

because of their income levels.”

Cost of building materials.

The most popular Metro Phoenix apartment submarkets? Lybik lists Downtown Phoenix, Tempe, the East Valley, Gilbert, Deer Valley, and

Despite a barrage of headwinds it faced coming

the Southwest Valley.

out of the COVID-19 pandemic that dealt a blow to

In Tucson, Lybik saws demand is strong although rents are going up.

every segment of the economy in 2020, Arizona’s

“Tucson has a lot going for it now,” he says. “It has the benefit of being

apartment industry has shown resiliency.

a tertiary market.”

Lybik says Flagstaff is seeing good rent growth. It will continue for the

Factors in its favor remain a strong Arizona economy, job growth, new

next couple of quarters. Vacancy rate is low, and so is new construction.

residents moving to the state, and a continued pent-up demand for

Local job market outlook

rental housing.

It’s all good news when it comes to Arizona’s job market, says Mark

As 2022 looms on the horizon, economic experts are feeling better

Paratore, Vice President for Business Development with the Greater

about the state of the apartment industry in Arizona. Panelists at this

Phoenix Economic Council (GPEC).

year’s AMA Perspectives & Projections industry outlook conference painted a positive picture, but also told those in attendance to be wary.

Arizona housing perspective In Arizona, developers are attempting to meet pentup demand, says Jay Lybik, Director of Multifamily Analytics at CoStar Group. Twelve years ago, we were over-housed; today we are under-housed, he says.

“You can see that in terms of multifamily,” Lybik explains. “We need more of it. It has shifted outward since the Great Recession. Household growth is muted because of lack of supply. At the same time, rent growth has exploded across the nation.

In Phoenix by 22½ percent year over year and by

Lots of ideas are being tried,” Cook-Davis says. “No one has totally figured it out.

It’s one of those things that’s not just one policy. It will take a blended approach.”

15 percent year over year in Tucson.”

“People are relocating to Arizona, and they’re not just moving here to retire but enter the workforce as well,” he says. “We live in the fastest growing county (Maricopa) in the country. And it’s happened despite the pandemic. Livability is top of mind for companies looking to move here.”

Paratore says that more than 850 companies located to Arizona from 2017 to 2021. It represents a potential capital expenditure of $71.5 billion. Fiscal year 2022 prospects by headquarter relocations: 18 percent of the prospects will be from California; 32 percent international prospects.

“Arizona is now part of the conversation,” he says.

“That’s what happened when 300 new residents move to Arizona each day.”

Arizona legal and affordable housing outlooks

The Valley’s apartment market is also under-housed, he says.

Panelists put the spotlight on two of the industry’s major challenges

“It’s all about supply, demand, and occupancy. There has been a lot of

in 2020 – the eviction moratorium and affordable housing.

absorption in the first and second quarters of the year. The upside?

“Why aren’t we able to figure out this affordability piece?” asked

This is definitely very good in a market like ours because of migration.”

moderator Jake Hinman, Government Affairs Consultant for Capitol

Apartment vacancy in Metro Phoenix was 6.9 percent a year ago; it’s

Consulting.

4.9 percent today, Lybik says.

The affordable housing crisis has been around for years, but it became

“The lower-priced assets have been continuing to decline in vacancy.

a much bigger issue during the pandemic. Owners and residents alike struggled as evictions became a scourge on the industry.

What’s helping on the demand for higher-end units is people relocating from California where rents are $4,000 to $5,000 a month. They

“There is a great need for a mix of affordable and market units,” says

move here and $2,000 a month is a bargain.”

Gloria Munoz, Executive Director for the Housing Authority of Mar-

Data show that the Metro Phoenix economy has changed dramatically,

icopa County. “It’s an under count when we see a need for 136,000

Lybik says. It has experienced a big boost in the high-wage jobs, a

affordable units in the Valley. About 163,000 are needed in Phoenix

huge shift for the Valley.

alone. This includes multifamily and single-family housing.

“It has become a more self-sustaining region economically,” he says.

“And it’s growing with jobs that are high paying and sustainable. People

Apartment News | November/December 2021

–Continued on next page

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Repurposing other property types into apartments A trend witnessed in 2021 was turning office buildings into apartments, which presented opportunities and challenges for downtown business districts, according to Rent.com.

It makes sense. During the pandemic, U.S. workers turned their homes into offices. Office buildings becoming apartments could be a major real estate trend, Rent.com reported.

“ Work from home” has opened-up new development opportunities.

“A lack of it translates into $2 trillion in lost wages and productivity,” says Allison Cook-Davis, Associate Director of Research at the Morrison Institute of Public Policy. “Think of the cost burden. It can quickly further instability and lead to eviction.”

In Arizona, AMA member MEB Management Services redeveloped a struggling Comfort Inn and Suites hotel in Prescott into The View at Prescott Valley. It offers exclusive short-term multifamily housing, and temporary housing arrangements on a four-week (28-day) rolling basis to those seeking a place to live while they search for their permanent home.

Legal panelist Mark Zinman with Zona Law Group says bills at the Arizona Legislature are just as important as keeping false stories about rent control out of the media.

“We can’t continue to be the dog everyone likes to kick,” he says. “We need owner and tenant advocates. You don’t want to kick people out.

You want a threshold to make a living be able to pay your rent.”

What states are doing it right when it comes to the affordable housing issue?

“Lots of ideas are being tried,” Cook-Davis says. “No one has totally figured it out. It’s one of those things that’s not just one policy. It will take a blended approach.”

National housing perspective Job growth continues to be contributing factor for a robust national housing outlook, according to Kimberly Bynum, Principal with Zonda Advisory. Leading the way, she said, are jobs in the business and professional sectors.

“Jobs are always the best indication of that (a healthy housing market),” Bynum says. “We are seeing a little bit of a divergent GDP and labor market. We witnessed the largest drop in history (during the height of COVID-19) and the largest uptick in history.

“We’re still down 5.5 million jobs. What will it take us to get them back?

Probably another two years to get us up to par. We were experiencing two decent months this year, then the delta variant took over. That set us back another seven months,” she says.

“The new red line in America is single family. That has driven develop-

Indeed.com postings are in Phoenix and Tucson, Bynum says, adding

ers to single family neighborhoods. We have to push that political will

“it’s a great job market for those coming out of school.”

to get affordable housing done. This includes zoning and permitting; removing some of the barriers that exist. NIMBYism is strong and

However, there are also factors that could decelerate the housing

organized,” Munoz adds.

market’s growth, she says.

Why does affordable housing matter?

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“The next two years there will be a lot of bounce back in the industry. Issues include access to labor, inflation, higher interest rates, virus variants, supply chain challenges, changes in regulations, cybersecurity, and as always, the unknown factors,” Bynum predicts.

affordability … entry level means something

amenities appeal to those looking to rent

totally different today.”

and remain flexible.

The rental housing market is just as robust,

Where are the deals?

Bynum says.

“More suburban than urban,” Bynum says,

“People are renting today,” she says. “They

Concerning sales and supply, Bynum says housing is driving levels not seen since the mid-2000s.

are wanting bigger units again. In the past we saw urban apartments of 700 square feet. It’s different now. People are moving again. During the Great Recession every-

“The national projection is that the single-fam-

one stopped moving. Now the work from

ily count is down 18 percent year over year,”

home dynamic opens up new development

she says. “Builders were slowing construc-

locations.”

tion in spring 2020 and developers were delaying land purchases. We are up from the bottom in resale inventory. Pricing and

adding that urban deals used to be more expensive. “It’s equalizing now.”

According to GlobeSt.com, the U.S. multifamily market in 2021 “rebounded as swiftly as it stalled last year.” For industry experts the market enthusiasm came as no surprise.

Multifamily benefits from a renting culture

It’s a “more of everything mentality,” Bynum says. More companies, more salary, more diversity, more retail options. All of these

–Continued on next page

Apartment Demand Apartment demand will likely remain robust and rent growth remain elevated in 2022, given the current rates of absorption, and rising mortgage rates in 2022, according to GlobeSt.com.

Demand for multifamily apartments remains strong so far in the fourth quarter with a net increase of 1.06 million apartment units occupied since Q2 2020.

The multifamily vacancy rate has fallen to 4.6% (6.6% in Q2 2020) and the multifamily median asking rent is up 11.4% year-over-year (1.6% in Q2 2020).

50000

Apartment Units Absorbed

37500

25000

12500

Dallas

Houston

New York

Los Angeles

47,182

37,117

34,619

30,879

Washington D.C. 22,436

Atlanta

Chicago

Austin

Seattle

Phoenix

22,272

20,810

20,443

18,481

16,054

0

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that has driven apartment investment for

A apartments were marked by stability in

“COVID-19 has its own plan,” he says. “The

the last decade, GlobeSt.com reported, but

both rent collections and occupancy. In some

2022 midterm elections will be key when it

during periods of economic dislocation, hous-

cases, these buildings actually reported rent

comes to scrutiny and regulation of the in-

ing shows its resiliency. The pandemic has

growth.

dustry. That’s why we have to remain vigilant

been no different.

On the national legislative perspective, Greg

Due to the dynamics of this downturn, a Main

Brown, Senior Vice President Government

Street recession affecting service workers,

Affairs for the National Apartment Association,

luxury Class A owners and operators saw

says the eviction moratorium dominated the

little disruption, GlobeSt.com reported. Class

headlines in 2020.

when it comes to rental housing advocacy, strength, weakness, threat, and opportunity.”

What are the hot Valley markets?

It’s an exciting time to be an investor or developer in

“Arizona’s pro-business environment and decision to

Metro Phoenix, according to Yardi Matrix data.

remain open for business during the pandemic has allowed current businesses to expand and grow, and

The Valley’s multifamily market is enjoying some of the

has driven new businesses to locate and relocate in

most robust activity in its history, fueled primarily by

the metro area to benefit from fewer regulations and

its diverse economy and favorable demographic trends.

taxes,” Paul Tuchin, principal with High Street Residential,

According to Yardi Matrix data, multifamily sales totaled

Trammell Crow Company’s residential subsidiary, told

more than $8.5 billion in 2021 through September, plac-

Multi-Housing News.

ing Metro Phoenix among the top spots for investment among major U.S. metros.

The Valley’s top submarkets according to Yardi Matrix:

Several submarkets and cities in Metro Phoenix have been bustling with activity, buoyed by large commercial

1. Scottsdale

investments that are generating demand for housing. The $20 billion Intel expansion in Chandler, the $12 billion

2. Tempe

Taiwan Semiconductor Manufacturing Co. facility taking

3. Deer Valley-Union Hills

shape in Deer Valley, and the abundance of industrial facilities in West and Southeast valleys, as well as office

4. Chandler-Gilbert

relocations to Tempe, Scottsdale and Downtown Phoe-

5. West Valley.

nix, have all resulted in significant boosts for Phoenix’s multifamily market.

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Participation in the Resident Relief Foundation program is critical to our residents and industry

By Tom Shelton

The multihousing industry and the residents we

The success of this program lies largely with us, multihousing’s lead-

serve have endured a very trying past 18 months

Foundation program is critical in ensuring that residents are able to

ers, owners and managers. Our participation in the Resident Relief receive the funding available to them for rental assistance.

because of the COVID-19 pandemic.

How can you help?

It has brought about hardships for our residents that no one could

The easiest way to ensure that your residents receive the funding that

have anticipated two years ago, leaving many jobless and without

they need is to simply participate in the program by responding to

a reliable source of income to secure even their most basic needs,

inquiries from the Resident Relief Foundation regarding your residents.

including housing.

If a resident at your property applies for assistance, a representative

More often than not these individuals are hardworking, responsible

from the foundation will reach out to you to verify resident identity

residents, facing a temporary crisis that is outside of their control.

and rental history. It is a quick process that makes a large impact.

The Resident Relief Foundation recognizes that these short-term cir-

Tell your residents about the program. Residents may apply directly

cumstances can have a devastating and long-term impact on residents’

for funding at residentrelieffoundation.org/our-programs/.

stability and aim to intervene before it is too late.

Help fund the grants provided by the Resident Relief Foundation by

Through a thorough vetting process, the Resident Relief Foundation

making a monetary contribution. The Arizona Multihousing Associ-

provides emergency rental assistance to responsible residents, en-

ation believes so strongly in this program that it has already made

suring that they and their families have the means necessary to stay

a $50,000 contribution to help keep our residents in their homes.

Won’t you consider making your own contribution so we can help

in their homes as they get back on their feet.

even more people?

Please make any contributions at azmultihousing.org/GiveNow to ensure that your donation stays with Arizona residents.

As industry leaders, our participation in the Resident Relief Foundation program is critical to our residents and our industry. I urge you all to get involved and make a profound impact in the lives of our residents in need.

Tom Shelton is Principal with Asset Living and a former Chairman for the Arizona Multihousing Association.

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AMA Patron Profile Windom Security

4914 E. McDowell Road, Suite 101, Phoenix, Arizona, 85008

By Peter Madrid

As a relatively new AMA member, Windom Security has wasted little in becoming fully engaged with the organization.

According to Chief of Staff Ruth Fosnot, the Phoenix-based security firm has been affiliated with AMA since the fall of 2017.

“As a Platinum Patron of AMA, the Windom Security team has been able to build relationships with the property managers, regional managers, and decision makers in the multifamily industry here in the Valley,” Fosnot says. “We can provide their communities support with our high-quality security services. It’s a joy to passionately share about our veteran-operated security agency that was founded to bridge the gap between security and law enforcement.”

Security is a key aspect of consideration for potential residents and can make all the difference on what community they and their family decide to move into...”

The past 18 months have taken a toll on the industry as COVID-19 affected almost every business across the U.S. Fosnot says Windom Security successfully pulled through during this particularly challenging time.

Ruth Fosnot Chief of Staff P: 480-478-0778 rfosnot@windomsecurity.com

“Our team has been so supportive and caring towards each other during the past year and a half,” she says. “When a few of our folks contracted COVID-19, our incredible team members stepped up to the plate, covered shifts, checked up on each other, and filled the voids so that our services to clients would not be negatively

Windom weathered the pandemic by aggressively hiring, but not

impacted.

because of COVID-19 vacancies. The hiring was made possible by

“Windom Security also ensured that our guards had all the pro-

a surge in new contracts.

tective equipment and gear necessary to safely utilize company

“We nearly doubled in size over the past year and a half,” Fosnot

patrols, conduct patrols, and interact with community members

explains. “It’s an exciting time for folks to join our team because

and the public.”

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we can promise the highest pay in the industry plus benefits as

“As we make a difference at these communities, these managers

well as a steady full-time schedule and a tight-knit comradery. This

share their testimony with other communities and then these

allows us to hire veterans, current military members, and folks

folks reach out to us. Referrals are the main way that we get

pursuing law enforcement careers and train and retain them as

new business. That speaks volumes of our reputation within the

high-quality guards.

Arizona multifamily community.”

Multifamily is one of the most robust asset types in Arizona. How

“In my function as a recruiter, I have a lot of fun speaking to folks on the phone talking about how active and interactive our patrol

is this benefiting Windom Security as hundreds of new residents

positions are. Some of these folks transitioned out of the military

move to the Valley each day?

during the pandemic or were laid off and have been ‘itching’ for an

“The need for multifamily communities has never been more

action-packed job where they can make a difference. We definitely

prevalent. Security is a key aspect of consideration for potential

can check all of those boxes for them,” she says.

residents and can make all the difference on what community

Industry groups are vital to the success of any business. How has

they and their family decide to move into since they want to feel

Windom Security leveraged its standing in the Arizona multifamily

safe in their new environment,” Fosnot says.

community through its membership in AMA?

“When security is prioritized at a community, it impacts many

“We have made a powerful difference at more than 130 commu-

aspects. We can support the property manager with concerning

nities across the Valley,” Fosnot says. “When Windom Security is

misconduct or criminal trends; residents have a fast and reliable

patrolling those communities, we are handling noise complaints,

source to reach out to in order to provide solutions and be safer

pool parties, trespassers, transients, suspicious persons, inter-

and this results in renewed leases, referrals of the community to

acting with community members, ensuring that our guards are

others, and increased property value. Security that truly partners

interacting with anyone that looks suspicious, and watching for

with law enforcement and does not just observe and report is an

area trends.

asset to communities all over the Valley.”

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Legally Speaking Here comes 2022: What’s on the horizon?

By Mark B. Zinman, Esq.

For the past few years, I have written the year-end,

they would like to keep their customers, provided they are paid for the services rendered.

legal article about what to expect for the coming

It is notable that the lack of an eviction tsunami is not widely report-

year. It’s fascinating to look back and see my past

ed. Instead, there was a complete change in narrative, which now

projections.

focuses on the increase in evictions and how owners allegedly have too much power over residents. This narrative will shape what we

Good news: I am happy to report that if you look at the past few years,

expect to see in 2022.

I have done pretty well in projecting what was coming. More than that, it’s fascinating to see how the landscape in our industry has changed,

As we have already seen, it doesn’t necessarily matter what facts

and continued to change, over the past several years.

eventually come to light and whether the stories about our industry are true, the repeated, incessant stories about “the big bad property

As they say – change is constant.

owner” have meaningful impact on legislators. Instead of stories

Before analyzing the details of what is coming, it’s important to quickly

about how developers are building beautiful properties with incredible

look back and see what we have seen so far. Most importantly, we

new amenities, or how developers are facing “not in my back yard”

are happy to report that there was never an “eviction tsunami” after

arguments preventing new developments on a local level, you see

the eviction moratoriums expired.

stories of how rents are increasing. This ignores the obvious fact that if developers are allowed to build more units, rents would go down.

Reporters and legislators referenced this alleged tsunami for 18 months, justifying why the eviction moratoriums needed to be continued.

Given this, we would expect to see a lot of activity at the legislature

Even our U.S. Supreme Court originally allowed the unconstitutional

focusing on owner-resident matters, and most, if not all such legislation

moratorium to continue, citing the need to give government the time

will be pro-resident. We would expect that resident advocates propose

to get rental assistance out.

legislation that focuses on rental rates and the eviction process.

However, once the moratorium was held unconstitutional, there was

For example, we expect resident advocates to propose a bill that would

NEVER an eviction tsunami. As of the writing of this article in October,

permit cities and towns to enact rent control. For years, rent control

there has been an increase in eviction filings, but the number is still

has been prohibited in Arizona. This could change with a vote in the

below pre-pandemic levels.

Arizona Legislature, and it’s incredibly important to rebuff such efforts as most economists agree that rent control doesn’t actually work.

This is definitive proof that owners and managers worked with their residents and continue to do so. Just like we have been arguing for

Also, we expect to see more legislation to get legal representation for

years, rental property owners are not in the business of evicting

residents. There are numerous reports about how owners are regularly

people for no reason and would much rather keep a resident that is

represented in court, but that residents are not and that this makes

working with them to get the rent paid. As with any other business,

the entire system unfair.

Apartment News | November/December 2021

14

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The repeated prediction of an

“evection tsunami” never materialized.

This ignores the fact that owners are paying for their attorneys, and

Finally, to the good news. The change over the past two years has

that most often in a non-payment of rent eviction where there are few

brought a lot of innovations in our industry and we expect to see

legal defenses, it makes no sense for a resident to have an attorney.

this continue. There are a lot of companies that would never have

Resident advocates will push for new means to get residents free

considered doing self-guided tours before the pandemic, and now

legal representation.

such an amenity is common practice.

We expect that some advocates will also push to delay the eviction

We found that our industry was very quick to adapt to change, and

process. Changing the time period for notices, or giving extra time

we expect that to continue. The industry’s response to the pandemic

before trials are only two of the ways that we have heard to delay

as a whole, is something that all property managers and owners

eviction actions. This could happen on a local, state or even a federal

should be proud of.

level. We suspect that we have not heard the end of the 30-day notice

We addressed an unprecedented change to the industry and worked

requirement coming from federal agencies.

to improve the properties and offerings for residents at the same time.

Remember, just because these issues will be raised, doesn’t mean they

We expect our industry to do the same moving forward.

will become law. What happens down at the legislature, is a function

While the reporting often tries to paint a picture of “owners v. resi-

of the make-up of the legislative body as well as the advocacy that

dents,” we know the truth that all people in our industry want to build

the AMA is able to accomplish on behalf of its members.

and manage great apartment communities and provide exceptional

Outside of the legislative matters, we expect to see an increase in

service for residents.

the number of fair housing complaints, BBB complaints as well as Attorney General Consumer Protection complaints – frankly, we have already seen an increase.

Mark B. Zinman is an attorney with Zona Law

While there was never an eviction tsunami, once the moratoriums

Group. He is a past and present board

ended, there was an increase in complaints and hostility from resi-

member with the AMA. He may be reached

dents against managers. Once non-paying residents lost their gov-

at 480-949-1400.

ernment-forced protection from eviction, they sought other avenues against their landlords as retaliation for evictions being filed. We have seen a significant spike in such matters and expect it to continue into 2022.

Apartment News | November/December 2021

15

azmultihousing.org

AMA Happenings

Yes! Day for Autism Phoenix AMA staffers and AMCF committee members turned out to volunteer at the Kid Zone at the SARRC (Southwest Autism Research and Resource Center) YES! Day for Autism at Tempe Town Lake. The event was held in October.

Apartment News | November/December 2021

16

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–Continued on page 14

Legislative Update

Housing Affordability Who dug the hole and how do we climb out?

By Jake Hinman

In the 2021 Arizona legislative session, lawmakers passed, in what amounts to one of the largest investments in housing in our state’s history through the creation of a state-level Low Income Housing Tax Credit (LIHTC) program.

Apartment News | November/December 2021

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The $160 million program may nearly double

Between the moratoria and regulatory barri-

In 2016 the Obama Administration released

the production of affordable housing units for

ers to build new homes, Arizona is in the mid-

a Housing Toolkit, outlining many of these

those earning at the lower tier of the income

dle of a perfect storm of a dwindling housing

regulatory challenges. The president noted

scale. This was an important first step and

supply and a surging demand.

that, “local policies acting as barriers to hous-

investment in housing and could help alleviate an immediate housing need.

Possibly some of the most glaring evidence to support this can be seen through a recent

While the state LIHTC program might have

economic study commissioned by the AMA.

garnered most of the attention this year, law-

The study indicates that in the 1980s, Metro

makers also passed legislation that could

Phoenix produced more than 105,000 mul-

begin the conversation into a much broader

tifamily units.

debate on housing policy.

However, in the following three decades, the production plummeted, and the Valley

law by Gov. Doug Ducey last May. While it

averaged only 47,000 units per decade. This

may have lacked any media fanfare, it will

production dropped even while the state has

have critical policy implications going for-

consistently been one of the fastest growing

ward. The bill is relatively straightforward: it

states in the country.

the probable impact of any proposed zoning ordinance or text amendment on the cost to construct housing.

In another study that was recently released by the National Multihousing Council and the National Association of Home Builders, on average, 32% of multifamily development

This is a relatively low bar for cities to comply

costs are attributable to the costs associated

with when enacting changes to their zoning or-

with complying with local, state, and federal

dinances, but it may have hinted what’s to come

regulations. In a quarter of cases, that number

with future deliberations on housing policy.

can reach as high as 42%.

The reality is, and especially more recently,

Over the years, these regulatory policies have

one cannot escape the “housing affordability”

only grown in scope and number. While in the

narrative that seems ever present in many of

past building construction codes, permitting

the mainstream media sources in Arizona and

fees and taxes were seen as the primary cost

across the country.

contributors to housing development, those

Certainly, one could point to the recent federal eviction moratoria as having created an acute

make developable land much more costly than it is inherently, zoning restrictions, offstreet parking requirements, arbitrary or antiquated preservation regulations, residential conversion restrictions, and unnecessarily slow permitting processes.”

SB1409 was unceremoniously signed into

simply requires a local jurisdiction to consider

ing supply include land use restrictions that

codes have now morphed into non-life safety energy, green and design standards.

The president went on to say that, “emerging research has shown that in areas with highcost housing such as California, zoning and other land-use controls contribute significantly to recent sharp cost increases, reflecting the increasing difficulty of obtaining regulatory approval for building new homes.”

Remarkably the Trump Administration seemed to agree with the prior administration’s assessment and even created a White House Council on Eliminating Regulatory Barriers to Affordable Housing through executive action.

President Trump noted, “federal, state, local, and tribal governments impose a multitude of regulatory barriers — laws, regulations, and administrative practices — that hinder the development of housing. These regulatory barriers include … inordinate impact or developer fees. These regulatory barriers increase the costs associated with development, and, as a result, drive down the supply

impact on housing affordability especially

And then there is zoning, perhaps the great-

of affordable housing. They are the leading

with ‘mom and pop’ investors leaving the

est barrier of all. While zoning and land use

factor in the growth of housing prices across

markets altogether.

restrictions have always presented challenges,

metropolitan areas in the United States.”

According to a survey conducted by the National Rental Home Council, a majority of

those challenges have increased exponentially in recent years.

In many ways Arizona is at a crossroads. The state can continue to its course and allow

single-family rental home property owners

But perhaps there is some light at the end

local jurisdictions to artificially restrict the

say they’ve been negatively impacted by the

of the tunnel.

market, or the state can chart a new course.

eviction moratorium, with 30% saying they will be forced to tighten standards when evaluating future rental applications, 11% forced to sell at least one of their properties, and 12% forced to sell all their properties.

In the past few years, both sides of the aisle have started to recognize that regulations are

A course that allows the free market to keep up with a surging demand.

creating this affordability crisis and that local land use restrictions, discretionary review, fees and regulations are driving up the cost

But perhaps the most significant cause to

of housing, impacting the affordability in mar-

these affordability issues, and something that

kets and making the production of affordable

has been ignored for far too long and is what

housing less attainable.

SB1409 was trying to get to the root of, is

Jake Hinman is the Director of Government Affairs for Capitol Consulting.

He can be reached at 602-712-1121.

the regulatory side of housing construction.

Apartment News | November/December 2021

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azmultihousing.org

Education & Events AMA education classes are tentatively scheduled as online (Zoom) only. Some AMA events are scheduled to take place both in-person and online. To register online you will need your username and password. For times and more information on AMA events please visit azmultihousing.org.

PHOENIX

TUCSON

n EVENTS AND EDUCATION CLASSES

n EVENTS

November Fair Housing

Tucson Education Conference and Trade Show

Nov. 9

Nov. 10

For rental property owners and

Join us for AMA Tucson’s big-

managers, understanding and

gest event of the year. AMA’s

complying with fair housing

annual Trade Shows are the

laws and the American with

Association’s largest events of

Disabilities Act (ADA) is more

the year and on the “Can’t Miss”

important than ever. This

list of AMA activities. While

interactive course will provide

the highlight is most definitely

an overview of fair housing and

the over 80 Exhibiting Indus-

ADA law, and investigative procedures. This course is taught by an AMA attorney. Get your CALP, CAM, CAPS and Real Estate CEC’s.

Phoenix Education Conference & Trade Show Nov. 17 AMA’s annual Trade Show is the Association’s largest event of the year and on the “Can’t Miss” list of AMA activities. While the highlight is most definitely the over 150 Exhibiting Indus-

products and services to our

Landlord Tenant

Regular Members in a fun and

Dec. 8

casual atmosphere. Regular

Knowing how to use and com-

Members have the opportunity

ply with state law that governs

to hone their skills by attending

all rental housing operations can

dynamic education sessions.

save time, make you money, and minimize legal difficulties.

Lunch and Learn

This is a must for any property

Nov. 19

owner, community manager,

Grab your lunch and join us for a

and leasing consultant. You will

30-minute bite size lesson. Hear

review the revised law, which

tips and tricks on a variety of

outlines the rights and respon-

topics that will help you in your

sibilities for both landlords and

job or personal life immediately

renters. Time will be allocated

try Partner (Vendor) Member

for audience questions and

Companies, the themed show

answers. Get your CALP, CAM,

also includes giveaways, prizes,

CAPS, and Real Estate CEC’s.

try Partner (Vendor) Member Companies, the themed show also includes giveaways, prizes, networking and lots of fun. The AMA Trade Show is an excellent opportunity for Industry Partner Members to showcase their products and services to our Regular Members in a fun and casual atmosphere. Regular Members have the opportunity to hone their skills by attending dynamic education sessions in the morning.

networking and lots of fun. And puppies! This year will include a puppy cuddling lounge! The AMA Trade Show is an excellent opportunity for Industry Partner Members to showcase their

Holiday Party Dec. 2 Join us to celebrate the end of 2021 and toast what we know will be a great 2022.

Apartment News | November/December 2021

20

azmultihousing.org

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Newly named Industry Partner Committee wraps up year of events with visit to Avilla Lago

By Michelle Howland

The last event of the year was actually the first for

Jay filled us in on how many communities NexMetro owns and how many are in construction and in the pipeline. Ann highlighted MEB’s

the newly named Industry Partner Committee – a

partnership as a management company with NexMetro and its com-

visit to Avilla Lago in Peoria, Arizona.

munities.

This year Associate Members became Industry Partners. So, it was

In addition, Danielle provided us all the details on Avilla Lago. From the

fitting that on a gorgeous fall day the AMC, now known as the IPC,

time they received the first building, it took Danielle and her amazing

held its last event of the year around the community’s amazing pool

team three months to lease up.

area. Avilla Lago is located at 10310 W. Beardsley Road in Peoria. About

The winner of the lunch with NexMetro and MEB is Blue Steel Security.

45 industry partners attended.

About NexMetro

Avilla Lago is owned by NexMetro Communities and managed by MEB

NexMetro Communities is an innovative development company fo-

Management Services. Portfolio Manager Danielle Gilbert manages

cused on building luxury leased home neighborhoods that serve life-

Avilla Lago and other Avilla properties as well.

style conscious consumers seeking a new home experience without

IPC was fortunate to have Asset Manager Jay Dassele and his team

the burdens of a mortgage. In partnership with its affiliated companies,

from NexMetro with us as well as Ann Boomsma, Senior Vice President

NexMetro has developed Avilla Homes neighborhoods since 2010 in

of Operations and Amity Dalton, Asset Director, with MEB.

key Sunbelt locations. Combining elements of residential single-family

Apartment News | November/December 2021

22

azmultihousing.org

living with rental terms and management, NexMetro supplies a growing market niche of consumers a leased home experience like no other. Our residents are renters by choice. They seek a new American dream untethered by the responsibilities of home ownership. They want to live on their own terms with maximum flexibility and mobility.

At the same time, they value their personal space and privacy that a traditional apartment complex can’t provide. For more information on NexMetro, visit www.nexmetro.com.

■

On-site management

■

Concierge lifestyle services

■

Valet trash & recycling services

Avilla Lago offers a lifestyle bursting with opportunities to relax in comfort. A lifestyle where quality living is met by outstanding

Avilla Lago Avilla Lago features single-story detached homes with private entryways and backyards.

Be among the first to reserve a brand-new home and get ready to fall in love with your best life. Avilla Lago is Peoria’s newest luxury gated community and is the premier destination for pet-friendly living.

Relax in comfort with top-of-the-line home

community amenities and premier home features. With stunning one, two- and three-bed-

■

Private backyard

■

Front porch/private entrance

built to awe and inspire. They are perfectly

■

High ceilings

crafted just for you.

■

Open floor plans

room homes for rent, we have the floor plan for you. Our brand-new Peoria homes were

Community amenities ■

Pet friendly (no breed restrictions)

■

Dog park Resort style pool

interiors and expansive floor plans. Private

■

backyards with patios make for the perfect

■

Spa/hot tub

combination of privacy and luxury with main-

■

Outdoor kitchen & BBQ

tenance-free living. Each detached home of-

■

Fire pit

fers amenities catered to your lifestyle. No

■

Outdoor lounge seating

breed restrictions mean your pets can join

■

Putting green

our pet-friendly community.

■

Game area

■

Walking paths

perience Avilla Lago living. Get your sweat on

■

Outdoor green/open areas

and then cool off in the swimming pool. Rent

■

Gated community

a private detached garage for extra space.

■

Our professionally managed community is

Covered parking

■

Garages available

■

24/7 emergency maintenance

be a member of the Avilla family.

Apartment News | November/December 2021

■

■

23

Wood plank style flooring throughout Granite countertops

■

Stainless steel appliances

■

Ceiling fans with light kits

■

Walk-in closets

■

Full size washer/dryer

■

EPA indoor AirPLUS Certified

■

Air conditioner

■

Energy Star Certified thermostat

■

Step outside of your brand-new home and ex-

designed to be your home, where you can

Apartment amenities

Preinstalled Wi-Fi with 1st month free from Cox

Pet policy Avilla welcomes all dog breeds, ages, and sizes. Three pets per home maximum. Pet interview required. All fees are per pet.

azmultihousing.org

What’s Up Down in Tucson

AMA Tucson Leadership Change

Tucson AMCF Bowl-A-Rama

We are pleased to announce that Linda Mo-

Big Hearts was back with its much-antic-

rales is the new Tucson Area Association

ipated Tucson Bowl-A-Thon and this year

Executive. Linda joins AMA after serving as

everyone had fun with a 50s Bowl-A-Rama

Property Manager at Sabino Canyon Apart-

theme. Members had a great time network-

ment Homes. She has been in the apartment

ing and bowling for a cause, raising more than

industry for 27 years.

$10,000 through lane sponsorships, Bowling

A native of Southern California, Linda has been involved with AMA, serving on various committees. They include Big Hearts, the

Bingo games and silent auction. Thank you to all of our supporters and donors for this incredible event benefiting AMCF.

Linda was a Tribute Awards winner in 2018

Tucson Fall Festival and Trunk-Or-Treat

as Volunteer of the Year Tucson.

The networking committee shook things up

Trade Show, and Networking committees.

Away from the office, Linda enjoys spending time with friends and family. She says she truly believes that water is good for the soul.

You will find her also enjoying time at the lake, at the beach or by the pool.

Linda moved to Tucson in 1997. She is married and has two children and one grandchild.

Welcome to the AMA family, Linda.

this year and hosted a Fall Festival & Trunk-orTreat instead of its usual chili cook off. Management companies decorated their vehicles to compete in a contest to win one of four theme prizes: Scariest Car, Cutest Car, Funniest Car, Best Costumes, and People’s Choice.

Our Industry Partners didn’t let the fun stop there. They livened up the festival with games and a jumping castle to keep the fun going.

Thank you to all our participants for a great event.

Apartment News | November/December 2021

24

azmultihousing.org

THANK YOU

BGF UPDATE

PATRON MEMBERS! P L AT I N U M

5 million reasons to keep supporting BGF The AMA Better Government Fund (BGF) hit and surpassed its $1 million goal in 2020 at $1.046 million. The BGF is an industry defense fund used to independently support candidates and initiatives and to help support policies that strengthen the

Bringing us closer

apartment industry in Arizona.

Click here to learn more.

GOAL $5.0m $4.5m $4.0m $3.5m $3.0m $2.5m

G O L D

$2.0m $1.5m $1.0m S I LV E R

Current BGF Dollars Raised:

$1,529,379

For more information on how to become a patron member of AMA, please contact Charnissa Moore, cmoore@azmultihousing.org, 602-296-6208.

Apartment News | November/December 2021

25

azmultihousing.org

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