The Western region of the United States is preparing for another season of drought. California just experienced its driest January and February ever, and restrictions on the Colorado River are now hitting all sectors of the local economy, including home building. In her latest CNBC article, reporter Diana Olick explores how developers are pushing forward on large master-planned communities in states like Arizona, despite the lack of needed water to support those homes.
On a vast swath of land in Buckeye, Arizona, just west of Phoenix, the Howard Hughes Corporation is developing one of the largest master-planned communities in the nation, Douglas Ranch, flooding the desert with housing.
Howard Hughes CEO David O’Reilly says water will not be a problem.
“Every home will have low flow fixtures, national desert landscaping, drip irrigation and reclamation,” he said, adding, “we work with the local municipalities, the city of Buckeye, all the water districts, to make sure that we’re enacting real conservation measures, not just at our property, but across the entire region.”
The community is projected to have more than 100,000 homes, bringing in at least 300,000 new residents. Big public builders like Pulte, Taylor Morrison, Lennar, DR Horton and Toll Brothers have already expressed interest in building the homes, according to the Howard Hughes Corp.
And it’s just one of more than two dozen developments in the works around Phoenix, all as the West is in the midst of its worst drought in more than 1,000 years.
“They’re expecting the growth in this area to be a million people. And there isn’t the water to sustain that growth. Not with groundwater,” said Kathleen Ferris, senior water research fellow at Arizona State University.
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