What is being built in Fountain Hills: the downtown overlay, streetscape, and new parks

Nov 10

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On April 21, 2026, the Fountain Hills Town Council formally applied a new Downtown Overlay District that, over time, reserves ground floor space on the Avenue of the Fountains mainly for restaurants, shops, and entertainment. It is the biggest zoning change downtown in years, and it sits alongside a five year streetscape program, two new park projects, a 25 lot rezoning, and a water main job that has narrowed Palisades Boulevard since spring. Here is what the town has approved, what is still in design, and what it means if you own or plan to buy in Fountain Hills homes for sale.

The short answer The biggest approved change is the Downtown Overlay District, which steers future ground floor space on the Avenue of the Fountains toward dining, retail, and entertainment and allows homes above shops. Streetscape work on Verde River Drive and Parkview Avenue is in design, with later phases not yet funded. Skyview Park is out for bid, Sierra Madre Community Park is in design, and the Council rezoned about 20 acres for 25 single story lots.

What the town has approved and planned

Downtown Overlay District: added to the zoning code September 2, 2025 and applied to downtown April 21, 2026, with Innovation, Business, and Avenue subareas (Town of Fountain Hills news releases, Sept 16, 2025 and April 22, 2026)
Homes above shops: up to 35 units per acre on a parcel in the Business and Avenue Districts, with a full block average of no more than 15 units per acre (Town of Fountain Hills, April 22, 2026)
Streetscape design: $515,000 for Verde River Drive and Parkview Avenue design, started November 2025; program runs through 2030 (Town Projects page, checked Nov 10, 2026)
Drainage design add: $133,605 approved unanimously, moved from fiscal 2027 money budgeted to build the first section (Fountain Hills Times, June 24, 2026)
Sierra Madre Community Park: $600,000 budgeted for design in fiscal 2027, $11.4 million planned for construction over the next four fiscal years (Town Projects page, checked Nov 10, 2026)
New lots: about 20 acres between Golden Eagle Boulevard and Aspen Drive rezoned 5 to 1 for 25 Toll Brothers lots (Fountain Hills Times, April 22, 2026)

Downtown: the overlay in plain terms

The overlay divides downtown into three parts. The Innovation District, between Palisades Boulevard and La Montana Drive, is meant for uses such as laboratories and light manufacturing. The Business District, south of Palisades between Saguaro Boulevard and La Montana Drive, is aimed at offices and professional services. The Avenue District covers the Avenue of the Fountains and Verde River Drive from the Avenue to Parkview Avenue, and it is where the restaurant, retail, and entertainment rule applies. Existing businesses can stay as they are.

For housing, the key line is the density rule. Homes are allowed above ground floor commercial space in the Business and Avenue Districts at up to 35 units per acre on one parcel, as long as the whole block averages 15 units per acre or less. On a 4 acre block, that average works out to no more than 60 units in total (calculated by Arizona Luxury Partners). See where the district sits on our Northeast Valley map, which shows Downtown Fountain Hills (Town Center) and has a Fountain Hills zoom.

Downtown is a small housing market today. Our Downtown Fountain Hills homes for sale page counts 145 homes in county records, all condos and townhomes, with a median year built of 2005. Seven sold in the 12 months ending November 6, 2026 at a median of $450,000, with 2 listed for sale and about 3.4 months of supply (ARMLS via Flexmls, as of November 6, 2026). That is about 1% of the 672 sales town wide (calculated by Arizona Luxury Partners).

The streetscape program

The first phase covers Verde River Drive between Palisades Boulevard and Avenue of the Fountains, and Parkview Avenue between La Montana Boulevard and Saguaro Boulevard. Planned elements include sidewalks and curb ramps, trees, lighting, landscaping, and pedestrian crossings. The town held an open house on the 30% design on April 9, 2026 and closed online feedback May 9. In June, engineers found drainage needs that were not known earlier, and the Council approved $133,605 for added design. Combined with the $515,000 design budget, that is $648,605 committed to design so far (calculated by Arizona Luxury Partners from the two figures). The town has not posted a construction start date, and it says later years still need Council funding decisions.

Parks, roads, and other projects

Skyview Park: out for bid, planned with stabilized walking paths and space for stargazing at night and wellness classes during the day.
Sierra Madre Community Park: design contract awarded for land set aside near Golden Eagle Boulevard and Sierra Madre Drive, with a Council update scheduled for November.
Fountain Park: ramada replacement installation was expected around November 1 after fabrication delays, and more than 300 bollard lights are being retrofitted to 2,700 Kelvin LEDs, which fits the town's dark sky practices. Design for a future lake liner replacement has a $1 million fiscal 2027 budget.
Palisades Boulevard: EPCOR is installing about 1.5 miles of new water main between Shea Boulevard and SunRidge Drive, the road into SunRidge Canyon homes for sale, with lane restrictions expected at least through the end of 2026.

New homes and a denied rezone

The Fountain Hills Times reported that the Council approved a rezoning on April 21, 2026 for 25 Toll Brothers lots on about 20 acres between Golden Eagle Boulevard and Aspen Drive, with conditions for single story homes, a non developable floodplain, a 25 lot cap, and a sidewalk on Aspen Drive. For other new builds around the Valley, see our new construction homes for sale page. Separately, on October 12, 2026 the Planning and Zoning Commission voted 4 to 2 to deny a request to convert the third floor of the Fountain Park Hotel to residential units, citing concerns about mixing hotel guests with long term residents and lost sales tax.

What it means for owners and buyers

Most of Fountain Hills is built out, so changes like these tend to show up as gradual shifts in a few areas rather than large new subdivisions. Across ZIP 85268, 671 homes sold over the past 12 months at a median of $725,000 and 97.56% of list price, with about 5.1 months of supply (homes for sale in 85268, as of November 5, 2026). Those are the numbers to compare against as projects move forward.

Read the agenda. Planning and Zoning and Town Council agendas list pending cases near any address.
Ask about the parcel. Development Services can confirm zoning, overlay rules, and height limits.
Plan for event days. Big events on the Avenue bring crowds and street closures, so visit on one if you are buying close by.
Expect construction time. The Palisades water main and future streetscape phases mean lane work for months.
Avoid this mistake: treating a proposal or a design drawing as a sure thing. Only approved items on the official record are certain, and funding for later streetscape years is still open.

The honest caveats

Plans change. A zoning approval allows a use; it does not mean a builder or tenant will show up on any schedule. The streetscape program's later years are not funded yet, and the town has said Council still needs to set priorities for them. Some of what we cite comes from local news summaries, and full meeting details sit behind a subscription, so read the town's agendas and minutes for the official record. Downtown's 7 sales in 12 months is a very small sample, and one or two closings can move its median a lot. Nothing here predicts what any project will do to home values.

Frequently asked questions

What is the Fountain Hills Downtown Overlay District?

It is a zoning overlay the Town Council added to the zoning code on September 2, 2025 and formally applied to downtown on April 21, 2026. It splits downtown into three subareas, the Innovation, Business, and Avenue Districts, each with its own intended uses. The town says the goal is more dining, retail, and entertainment along the Avenue of the Fountains.

Do existing businesses on the Avenue of the Fountains have to change?

No. The town says existing businesses are not affected and can keep operating under current regulations. The ground floor rule applies over time as spaces turn over, so the mix changes gradually rather than all at once.

Can new apartments or condos be built in downtown Fountain Hills?

Yes, above ground floor commercial space in the Business and Avenue Districts. A single parcel can go up to 35 units per acre, but the average across a full block cannot exceed 15 units per acre. Any specific project still goes through the town's review process.

Does the overlay raise the height limit downtown?

Our downtown page notes that the overlay keeps the base 40 foot height limit, and the General Plan calls for buildings up to three stories with shops on the ground floor and homes above. Confirm current height rules for a specific parcel with the town's Development Services department before you rely on them.

What is the Downtown Streetscape Improvement Program?

It is a five year town capital program running through 2030 to improve sidewalks, landscaping, lighting, and pedestrian crossings downtown. The first phase is design work on Verde River Drive between Palisades Boulevard and Avenue of the Fountains, and on Parkview Avenue between La Montana Boulevard and Saguaro Boulevard. The town says future years' priorities and funding still need Council discussion.

When will streetscape construction start on Verde River Drive?

The town has not published a construction start date. Design began in November 2025, the town expected design to finish by July 2026, and in June 2026 the Council added $133,605 for drainage design that was taken from money budgeted for building the first section. Watch the town's Town Projects page for updates.

Why are there lane restrictions on Palisades Boulevard?

EPCOR began replacing about 1.5 miles of water main on Palisades Boulevard between Shea Boulevard and SunRidge Drive on April 21, 2026. The town says the work is expected to last at least through the end of 2026. EPCOR handles customer questions at 1.800.383.0834.

What new parks are planned in Fountain Hills?

Skyview Park is out for bid and is planned with walking paths and space for stargazing and wellness classes. The Sierra Madre Community Park near Golden Eagle Boulevard and Sierra Madre Drive is in design, with $600,000 budgeted for design in fiscal year 2027 and $11.4 million planned for construction over the following four fiscal years.

Were any new home lots approved in Fountain Hills this year?

Yes. The Fountain Hills Times reported that the Town Council voted 5 to 1 on April 21, 2026 to rezone about 20 acres between Golden Eagle Boulevard and Aspen Drive for a Toll Brothers development of 25 lots. Conditions included single story homes, a non developable floodplain, and a sidewalk along Aspen Drive. Check with the builder for plans, prices, and timing.

How do I check what is planned near a home I am considering?

Start with the Town of Fountain Hills Town Projects page and the Planning and Zoning Commission and Town Council agendas, which list pending cases. Ask Development Services about the zoning on the parcel and any nearby applications. An advisor can also pull the area's recent sales so you can compare prices on either side of a project.

The bottom line

Fountain Hills is putting rules and money behind a more active downtown: the overlay is in effect, the first streetscape phase is in design, and two parks are moving forward. Much of it will take years, and the later phases are not funded. If you own or plan to buy near the Avenue, Palisades, or Golden Eagle Boulevard, follow the town's agendas and compare prices with current sales data before you decide.

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Sources

Town of Fountain Hills, Town Council Adopts Downtown Overlay District, April 22, 2026. Link
Town of Fountain Hills, New Downtown Overlay District to Help Create Thriving Avenue of the Fountains, September 16, 2025. Link
Town of Fountain Hills, Town Projects page (streetscape, EPCOR water main, parks, Fountain Park), checked November 10, 2026. Link
Town of Fountain Hills, Open House for Preliminary Design of Verde River Dr. and Parkview Ave., March 25, 2026. Link
Fountain Hills Times, Town Council OKs additional funds for downtown streetscape designs, June 24, 2026. Link
Fountain Hills Times, Town Council approves rezone for 25 residential homes, April 22, 2026. Link
Fountain Hills Times, Fountain Park Hotel denied rezone for 46 residential units, October 13, 2026. Link
Arizona Luxury Partners, Downtown Fountain Hills homes for sale page, ARMLS via Flexmls as of November 6, 2026 and Maricopa County Assessor records pulled November 3, 2026. Link
Arizona Luxury Partners, Fountain Hills homes for sale page, ARMLS via Flexmls as of November 6, 2026. Link
Arizona Luxury Partners, Fountain Hills 85268 homes for sale page, ARMLS via Flexmls as of November 5, 2026. Link
Block unit example calculated by Arizona Luxury Partners: 4 acres times a 15 units per acre block average equals 60 units.
Design total calculated by Arizona Luxury Partners: $515,000 design budget plus $133,605 drainage design add equals $648,605. Downtown share calculated by Arizona Luxury Partners: 7 downtown sales divided by 672 Fountain Hills sales equals about 1%.

All information provided is deemed reliable but is not guaranteed and should be independently verified. This article is for general information only and is not financial, lending, legal, or tax advice. Arizona Luxury Partners | Real Estate Group at RE/MAX Fine Properties, 21020 N. Pima Road, Scottsdale, AZ 85255. Brokerage License LC629808000. Equal Housing Opportunity.

Kyle Hermann