Could a new LDS church raise surrounding property values enough to save the Southeast Valley from its real estate slump?

One Gilbert luxury home has experienced all of the Valley’s real estate mood swings, including a possible “Temple Effect” high.
 
Built during the height of the Southeast Valley real estate boom, the house sat empty for more than two years as observers wondered why million-dollar mansions were ever built in the middle of Gilbert alfalfa fields.

The answer may be looming to the west – the site of a planned Church of Jesus Christ of Latter-day Saints temple on the southeast corner of Greenfield and Pecos roads.

“Temples are famous for raising property values,” says Paul Gilbert, a Scottsdale attorney representing the LDS church for temple projects in Gilbert and northwest Phoenix.
 
Though it’s too early to tell if the “Temple Effect” will crack the depressed local housing market, the phenomenon has been witnessed several times near newer LDS buildings. In the past two years, new temples in the small Idaho cities of Twin Falls and Rexburg have been surrounded by custom home developments whose property values eclipse those in neighboring areas.
 
The Gilbert luxury house finally sold this summer, although the buyers say the proximity of the future LDS temple was just one part of a good buy in a buyer’s market.

“We didn’t know about the temple when we first inquired about the house,” says Tim Penrod, a Mormon who moved to Gilbert with his family from Mesa after getting a deal on the 6-bedroom, 5-bath mansion with a 3-car garage and guest casita for “considerably less” than the $999,000 listing price. “But we learned about it as negotiations went on, and it was a plus.”

Candace Robinson, the listing real estate agent, says that while LDS temples are “something a lot of buyers seek out,” she didn’t market the Penrod’s home solely to Mormons, adding that she had the long-vacant house listed for just 32 days before receiving an offer. But marketing efforts went as far as Salt Lake City, home to LDS headquarters, where a Web site focusing on Utah real estate listed the house as a “Beautiful Custom home near Gilbert Temple Grounds.”
 
Despite the sale, there are more than a dozen custom homes on the market in the exclusive, gated Whitewing Estates at Higley, where “For Sale” signs have popped up like the tumbleweeds in the foundering development to the south.
 
Whitewing resident Treven Rollins says the temple will mean more than real estate recovery. “Will it raise property values? Definitely,” says Rollins, who is LDS. “But it will bring a different environment to the community. Any time you build a building for sacred purposes, it brings value to the entire community. People not of the LDS faith will have respect for it.”

“[Temples] are very good neighbors and very special to Latter-day Saints,” says attorney Gilbert. “As a result, the Church has a very extensive budget for landscaping and maintenance.” For example, church officials recently decided to pay “a significant amount” to bury power lines near the Gilbert temple site, he says.

In 2008, LDS leaders announced plans for three new temples to handle church and population growth in Arizona. The third is in the Gila Valley in eastern Arizona.

The Phoenix and Gilbert temples, which are expected to open in two to three years, will be smaller than the Mesa temple serving the entire Valley, Gilbert says. The Phoenix temple, planned for land at 51st Avenue and Pinnacle Peak Road, will occupy about 9,500 square feet, Gilbert says. The Gilbert temple, on a site donated by the East Valley’s LeSueur family, which is LDS, is expected to be about twice that size.

Jim Golba, who owns a Gilbert real estate business, sees the temple as an important part of recovery.

 “Gilbert is a growing community and the temple will be integrated into the community,” Golba says. “By the time it opens, the local real estate market will be turning around and this will definitely help.”