Tag Archives: August – September 2006

21601 21st Avenue_Pompay

Cassidy Turley Completes $1.07M Sale of Deer Valley Industrial Property

Cassidy Turley sold 21601 N. 21st Ave., a ±13,068-square-foot warehouse property in Phoenix. Bunker Hill, LLC. (Phoenix), purchased the property for $1,078,000 ($82.49/psf) from High Altitude Holdings, LLC (Anthem, Ariz.). John Pompay of Cassidy Turley’s Industrial Group represented the buyer. Eric Bell and Mike Ciosek, with VOIT Real Estate Services negotiated the transaction for the seller.

Bunker Hill, LLC is a provider of ESD safe and static control equipment. The family owned and operated business has serviced the EOS/ESD Industry since the 1980’s. Bunker Hill, LLC plans to occupy ±7,468square feet of the building.
Built in 2000, 21601 N. 21st Ave. is a one-story warehouse-office building on .76 acres with freeway access to the Loop 101 and I-17 Freeway.

Tempe Rendering - PR 9-9-13

Liberty Center at Rio Salado Ready for Construction

Bulldozers and backhoes are in motion at Liberty Center at Rio Salado, the new sustainable mixed-use business park under development by Liberty Property Trust in Tempe at Priest Road and Rio Salado Parkway. The company is readying the location for construction with the recent approval of its site plan by the City of Tempe.

“Rising demand for larger, contiguous spaces is the catalyst for our quick start,” said John DiVall, senior vice president and city manager for Liberty’s Arizona region. “We have submitted plans for our first office building to the City and anticipate starting development of both that building and the main entrance to the park in the fourth quarter. Interest from current and prospective tenants is growing quickly, so we’re eager to begin to bring the vision of this park to life.”

In 2012, Liberty Property Trust was selected by the City of Tempe as the developer for the 100 acre site located at Priest Road and Rio Salado Parkway. Liberty Center at Rio Salado is centrally located in the heart of the Phoenix Metropolitan Area, offers unparalleled visibility from Arizona Route 143 and Red Mountain Loop 202, and is within minutes of Sky Harbor International Airport. The location is less than five miles from the company’s fully leased 1.2 million square foot business park Liberty Cotton Center. In addition to office, flex and industrial space, DiVall notes that the plans call for hotel, restaurant and retail locations.

“When complete, Liberty Center at Rio Salado will be a fully-visioned complex that will benefit tenants, employees and the City, and add valuable resources to the surrounding community,” he added. 

At build-out, Liberty Center at Rio Salado will feature more than one million square feet of space, and all buildings developed by Liberty Property Trust at the park will be designed to meet LEED certification with a focus on energy efficiency.

Wespac Construction will manage the earthwork on the site and RSP Architects is handling the land planning. Development work bids are still being processed.

Elliot Corp Center

CBRE Completes $23.5M Sale of Elliot Corporate Center in Tempe

CBRE arranged the sale of Elliot Corporate Center located at 875 W. Elliot Road in Tempe, Ariz. The 223,392 square-foot office building commanded a sale price of $23.5 million, or $105.20 per square-foot.

Jim Fijan and Will Mast with CBRE’s Phoenix office represented the seller, tenants-in-common owners through Costa Mesa, Calif.-based Thompson National Properties LLC . The purchase was a joint venture between Everest Holdings in Scottsdale, Ariz. and Walton Street Capital in Chicago, Ill.

This transaction is another example of the continued demand for office investment properties in the southeast Valley,” said Fijan. “Savvy investors recognize the continued strengthening of the market and well-located, well-taken-care of assets, like Elliot Corporate Center, are going to be well received.”

Anchored by The Apollo Group, Inc.’s The University of Phoenix, which occupies 162,069 square feet, the two-story Elliot Corporate Center was 87% at the time of sale. The project also houses Lamson Business College in 32,400 square feet. The remaining vacant space totals 29,923 square feet and is available for lease.

Built in 1998, Elliot Corporate Center benefits from immediate access to I-10 at Elliot Road as well as access to a densely-populated, large and well educated workforce in south Tempe and the extended southeast Valley.

The Offices at Reems.

Sperry Van Ness Represents the Seller in a 16-Unit Office Condo Portfolio Sale in Surprise

Justin Horwitz, Nicole Ridberg and Neil Sherman of Sperry Van Ness, LLC, in Phoenix represented Pacific Western Bank in the sale of the Offices at Reems, a 16-unit office condo portfolio located at 15515-15571 N. Reems Road in Surprise, Ariz.
The bank-owned shell and built-out condo units sold for $1,350,000 or $56 per square foot and closed on August 27. The portfolio is approximately 24,101 SF.
“The transaction turned out to be a win-win for both the buyer and seller,” said Justin Horwitz. “This sale put the Offices at Reems back on track to being a vibrant and desirable office condo project in the West Valley.”
The buyer, Reems and Greenway, LLC, was represented by Steve Cook of Escee Properties.

Michael Mahoney Cut

Mike Mahoney Awarded Sundt Construction Lifetime Achievement Award

Michael Mahoney CGM_9866Mike Mahoney, a general superintendent who most recently worked on Sundt Construction’s federal projects, was recently given a Lifetime Achievement award, underscoring Sundt’s core values of longevity and loyalty.

The award is not given annually; instead, it is only presented when warranted. This is the third time in the company’s 123-year history the Lifetime Achievement award has been presented. Mahoney’s contributions to Sundt were acknowledged during Sundt’s Annual Leadership Conference, where 100 of the top senior management gathered.

Mahoney, who started with M.M. Sundt as a concrete finisher, has worked on a wide range of projects across the United States for 40 years.


CBRE Hosts City-Wide Clothing Drive

Commercial real estate services firm CBRE is holding its third annual, city-wide business clothing drive called PurSUIT of SUCCESS, benefiting two nonprofit organizations that provide job training and career counseling to women and men throughout the Phoenix area.

The two beneficiaries of the business clothing drive are:

  • Fresh Start Women’s Foundation, a nonprofit organization dedicated to helping empower women through services focused on economic self-sufficiency, self-esteem and lifelong learning.
  • St. Joseph the Worker, which assists the homeless, low-income and other disadvantaged individuals in their efforts to become self-sufficient through quality employment.
WHEN: September 9 – 20, 2013 
WHERE: Current, gently-used business attire can be donated—Monday through Friday, 8 a.m. to 5 p.m. —at CBRE’s Phoenix Esplanade office, located at 2415 E. Camelback Road. In addition, 18 CBRE-managed buildings throughout the Phoenix area, along with hundreds of building tenants, are participating in the business clothing drive. Many of these locations are also accepting donations from the public, including: 

  • 3131 & 3333 E. Camelback Road, Phoenix
  • 3300 Tower, 3300 N. Central Ave., Phoenix
  • 5090 N. 40th Street, Phoenix
  • 92 Mountain View, 10001 N. 92nd St., Scottsdale
  • Broadway 101 Office Park, 2151 E. Broadway Road, Tempe
  • Desert Ridge Corporate Center, 20860 N. Tatum Blvd., Phoenix
  • Esplanade III, 2415 E. Camelback Road, Phoenix
  • Gainey Center II, 8501 N. Scottsdale Road, Scottsdale
  • MAX at Kierland, 16220 N. Scottsdale Road, Scottsdale
  • Northsight Financial Office Park, 14500 N. Northsight Blvd., Scottsdale
  • Phoenix Plaza, 2929 N. Central Ave., Phoenix
  • San Tan Corporate Center, 3100 W. Ray Road, Chandler
  • Scottsdale Financial Center III, 7272 E. Indian School Road, Scottsdale
  • Scottsdale Gateway, 9201 E. Mountain View Road, Scottsdale
  • Stapley Center, 1630, S. Stapley Drive, Mesa


PurSUIT of SUCCESS is the largest, business clothing drive in metro Phoenix, and benefits women and men in job training programs at Fresh Start Women’s Foundation and St. Joseph the Worker. Through these organizations, women and men receive career counseling, job skill training, emotional support and clothing suitable to wear in a business environment, which, in turn, provide confidence and a positive self-image—an important step in their individual pursuit of success.

During the past two years, CBRE’s PurSUIT of SUCCESS has collected more than 6,900 articles of clothing, providing interview and work outfits for hundreds of people working to regain their independence.

To learn more about PurSUIT of SUCCESS visit www.cbre.com/purSUITofSUCCESS.

Scott Canada & Eric Doran

McCarthy Building Companies Announces A Pair Of Promotions

Scott Canada, pre-construction director for solar installations at McCarthy Building Companies, was recently promoted to director of the company’s growing Renewable Energy team within the Southwest Division.

In this role, Canada will use his 15 years of experience in the solar industry to oversee a diverse portfolio of solar and energy related projects in Arizona, California, Nevada and New Mexico. He has been highly successful with forging true collaboration among the owner, design team and subcontractors on a variety of projects, and brings this experience to his new role.

“Scott’s extensive experience dealing with various aspects of utility-scale solar projects has been a tremendous asset to our team at McCarthy,” said Dennis Tucker, executive vice president of McCarthy Building Companies. “His expertise combined with his proven leadership abilities makes him a good fit for this new role.”

Canada is a LEED AP and a Certified Energy Manager and Certified Power Quality Professional with the Association of Energy Engineers. Last year, he was named to the merit review committee for the U.S. Department of Energy’s SunShot Concentrating Solar Power R&D Solicitation. He has also published several articles that have appeared in SolarPro magazine.

Canada holds a bachelor’s degree in chemical engineering from Texas Tech University and a master’s degree in construction management from Arizona State University.

McCarthy also recently promoted Eric Doran to project director.

In this new position, Doran will oversee a diverse portfolio of projects in Arizona, including the Banner Estrella Medical Center new tower addition as well as the IHS San Carlos Apache Rural Healthcare Center in northern Arizona. He has been highly successful with forging true collaboration among the owner, design team and subcontractors on a variety of projects, and brings this experience to his new role.

As project director, he will also serve as a liaison between the office and field teams; champion job-site safety efforts and proactively manage project budgets and schedules. He previously served as project manager and worked on a variety of projects including Banner Ironwood Medical Center in Queen Creek and Banner Gateway Medical Center in Gilbert.

“Eric has demonstrated excellent leadership and mentoring skills, which have earned him the promotion to project director,” said Bo Calbert, president of McCarthy’s Southwest Division. 

“He also played a key role in one of our most successful projects – Banner Gateway Medical Center in Gilbert – where he ran all aspects of the MEP scope of work from buyout and construction to BIM coordination and modeling.”

Doran joined McCarthy in 2003 as a project engineer upon graduating from Oregon State University with a bachelor’s degree in Construction Engineering Management. He is a member of the American Society of Healthcare Engineers (ASHE) and is a LEED accredited member of the U.S. Green Building Council.


Mi Casa, Su Casa

Protecting Your Mexican Real Estate Investment

Mi Casa, Su Casa

Protecting your Mexican
real estate investment

By David M. Brown

Contrary to what you may have heard, Americans, or any non-Mexican nationals, can purchase property fee simple (or direct deed) in Mexico except when the property is in the restricted zone: 32 miles from the shoreline or 62.5 miles from the border.

mi_casaHowever, buyers can acquire coastal and border-area properties in the restricted zone by establishing a Mexican Bank Trust, or fideicomiso. The bank, as trustee, charges an annual service fee and holds the legal title to the property for up to 50 years. For less than $1,000, the potential buyers register for a permit to establish the trust at the Secretariat de Relaciones Exteriores. The permit issued, a notario prepares the deed or “escritura.” After acquisition taxes and filing fees are paid, the deed is recorded.

Unlike the English common-law based American system, Mexican law is a civil law system and therefore heavily codified. However, it is specific regarding fee-simple ownership. The Foreign Investment Law of Mexico (FIL), established in 1971 and amended twice since, explains what properties must be in a “fideicomiso” and what properties are nonresidential and therefore can be purchased by foreigners in a Mexican corporation, explains Mitch Creekmore, director of business development for the Mexico Division of Stewart Title Guaranty Company in Houston.

As beneficiary of the 50-year fideicomiso, the buyer can basically do what he or she wants: Improve it, lease it, sell it, mortgage it, will it. Your estate becomes the beneficiary, and you or the estate can indefinitely extend the trust in 50-year periods. Buyers of a property already in a fideicomiso can begin a new 50-year cycle.

Dinero is spoken here
Don’t worry about financing either. Although most purchases of Mexican real estate by Americans have traditionally been cash deals, through home equity loans on a primary residence, or through private lenders, a growing number of developers are becoming involved in financing. In addition, third-party lenders in the United States are available, often accepting as little as 20 percent down on a purchase.

One of these lenders is the International Mortgage and Investment Group, based in Phoenix with offices in Austin and New York. Led by Timothy K. Kelley and Kevin Hardin, the IMI Group is helping to solve the former challenges of securing financing for property in Mexico. “In the past year and a half, there have been entities that have lent private-equity money to individuals buying homes,” says Hardin, the company’s CEO and a certified mortgage banker and certified mortgage consultant who has placed more than $10 billion in mortgages into the secondary market.

“Right now our biggest initiative is to educate people on either side of the transaction,” adds Kelley, a native Phoenician who learned about the Mexican industry by living and working in Mexico City for 10 years before returning to Arizona.

In addition, the men are working to establish a sound secondary market for selling Mexican-based mortgages. By providing a dependable means by which existing mortgages can be sold, more capital will be freed for new buyers, creating what Hardin calls a “free-flowing market.”

The IMI Group is also leading a nationwide effort to create an International Mortgage Lenders Association to represent individuals and entities involved in or related to the business of lending money to Americans buying property in Mexico. The men are working with stakeholders such as the Arizona Mexico Commission, the National Law Center for Inter-American Free Trade and financial-industry players such as GMAC-RFC, Stewart Title, Collateral International and M&I Bank.

Both men agree that the process for financing property in Mexico is much more accessible than it was even a few years ago. “It’s identical to the U.S. mortgage process, much like a Fannie Mae structure, in U.S. dollars, with a U.S. company, a U.S. escrow agent, and with a high level of confidence.” Similarly, title insurance policies are almost identical to those issued for American properties.

Get good counsel
Most importantly, when buying property in Mexico, have the right information and the right counseling, specifically with professionals who have experience on cross-border matters.

“More and more, the practice of law in Mexico is resembling the practice of law in the United States,” explains Benjamin Aguilera, an attorney with the Phoenix office of Greenberg Traurig. The reason for this, of course, is that so much of the capital is from the United States, though a U.S. attorney must still be familiar with the proper documentation in order to comply both systems.

Aguilera underscores: “There is no single glove that will fit every transaction.” Different states, for instance, may have different laws. “Despite the proximity, the ease of traveling, the appeal and allure of doing business in Mexico, it is a different country with very stringent laws and its own judicial system.”

AZ Business MagazineHe offers a few caveats: “Don’t eschew common sense in your south-of-the-border transaction. Don’t do in Mexico what you wouldn’t do here.” Furthermore, just being able to habla espanol isn’t enough. “It involves being knowledgeable of the interrelation of the two legal systems, the protocol for doing business, the nuances of the spoken and body languages and the financial effects on both sides of the border,” he says.





Arizona Business Magazine Aug/Sept 2006

AZ Business Magazine Aug-Sept 2006 | Previous: Urban Living | Next: Baby Steps

Urban Living

Urban Living Trends and Design

Urban Living Trends
and Design

What do the experts say on the Valley’s latest housing fad?

By David M. Brown

Developers are investing billions of dollars into urban-living newbuilds and renovations. Lofts, condos, townhomes in a variety of configurations and high-rises are attracting an array of buyers, from Millennials and Gen Xers to Baby Boomer empty-nesters. As the homesteading paradigm changes, Phoenix is distancing itself from the Wagon out West, put up your fence and enjoy the rural lifestyle mentality. Reporter David M. Brown brought together a group of experts to discuss this and the burning issues surrounding Valley urban living.

Urban LivingDMB: Let’s start with some of the larger issues of urban living. Why the proliferation of urban living spaces in an area whose tendencies have been almost anti-urban?
BG: One of the major drivers is that people who live here didn’t grow up in Phoenix and they’re used to a different type of living. We have a large part of the population coming in from the Chicago area, and that’s the way they’re use to living. The reasons? For one, people like to be around people. The hallways become the front porches, you run into your neighbors in the elevators.

DMB: Car dependency: How is that driving the demand for urban living?
SB: We’re working on several sites on the light rail route in downtown Phoenix, so developers are banking on having close access to that. Indeed, these developments would decrease our dependency on the automobile. Another reason is that people are tired of the daily commute, the sprawl. They’re starting to focus where the activities are.

DMB: But that’s a paradigm shift. People traditionally moved West for open space, not for urban space.
JB: Yes. The development patterns of the past have changed. In the past it was the developers rolling out the red carpet, grabbing up land because that was the most cost effective way to go. But what’s happening now is that there’s an influx of people and a demand for urban redevelopment. Right now, there may be 2,000—some developers say 5,000—of these units in construction. That will shake out in time. Traditionally the Valley developed in a variety of nodes, such as Phoenix, Scottsdale, Tempe. And, of all of them, where you can work and play, the one that I think has the best chance is Tempe, which has so many of the components for success in place. Kierland is a great place, and will be a great model and successful, but it’s still car dependent and I think it always will be…For downtown Phoenix, I am not yet sure as to how it will sustain itself in terms of the urban living model. There are a lot of condos being built or on the boards.

DMB: Hasn’t the urban living component been the element that has been missing there for so many years. The stadium is good, the entertainment venues, but the city needed people down there 24/7 to support the restaurants, the shops?
SB: And a grocery store!
JB: Yes. We will see how that plays out.

DMB: How about demographics? Is youth is a factor for the rise of urban living? We are one of the youngest big cities in the country.
BG: I think older people are getting younger, too. They’re looking at the same kind of fashions as the younger generation.
JB: It’s a lifestyle decision. Across the board, there’s a choice being made, whether you’re a Baby Boomer or a young professional or a young couple. They’re making a choice whether to live out on the fringe or near the mix of what’s going on.

DMB: How about the spaces themselves? They are various in terms of design—high rises, lofts, condos—but similar perhaps in terms of flexibility. That is, they are performing the functions of the white picket-fence home.
DL: We’ve been doing towers and townhomes, too, with equal interest by the buying public. What draws them together is that they must be part of the urban fabric. The townhomes, with a front door, open up to the street with a front yard. The high rises also engage the city as well.
SB: The Esplanade on the Camelback Corridor is a high-end area, with an average size of about 2,800 square feet. Those buyers want something totally different than what the loft product buyers want—more toward downtown and Tempe. The finish levels are different, the prices are different.

DMB: Much of this urban living market is enabled by the wealthy. What about overall affordability? Can the urban living model provide a variety for students and young couples?
DL: Yes, I think so. Let’s look at the markets that we’ve identified: First, the retirees; then the empty-nesters; dual-income, no children; investors; and those who are buying a second home.
BG: I think we can throw in a new category of the newly divorced . . .
SB: Then there’s another category, such as the W Hotel going downtown: the hotel, with a major portion of condominiums.

DMB: So because of the many markets, there are opportunities for affordable urban living spaces?
SB: Yes, that’s what’s driving the smaller units in downtown Phoenix. The goal our developer has on the downtown projects is a price point under $400 a square foot. That’s difficult to do on high-rise construction because of the requirements of that mode of construction. So, if you can keep the price under $500,000, that’s a good entry level price point.

DMB: What about the design itself?
JB: You mentioned flexibility and that’s a big part of those spaces. Say it’s a studio or a one-bedroom: Our challenge is how to make that one-bedroom feel as if it’s the biggest one bedroom you can get? Well, you get floor-to-ceiling glass. You have a balcony with doors, so the room expands when they’re open and you get additional space. Say the balcony is 180 square feet and the unit is 640 or so; you’re entertaining and you open up those doors, so now you have an 800-square-foot unit.

DMB: This is a different way of thinking. The luxury single home opens out toward more space; these require the designer’s capacity to, in essence, create space?
JB: You become as efficient as you can; you use every inch.
SB: You want the greatest floor-to-ceiling height these units can afford. At the same, time, you have a fixed envelope for high-rise projects. What we will often do is provide the lower floor-to-ceiling heights on the lower floors and greater on the upper. It would be nice if we didn’t have to fight the limit on every project.
BG: Getting back to the matter of space, I guess I would call it “rigid flexibility” because you want to move things around inside the units. Certain matters are fixed, like the plumbing; but you can change the interior, too, with items like furnishings.

DMB: You might speak a little to that, Janelle? You coordinated the models at the Landmark on Central, originally built in 1964 as a luxury apartment complex. What were your challenges to convert these to 21st century condos?
JS: You want to retain functionality yet fit it into a very small space. You’re dealing with a market that wants to work at home, wants a place to dine, a view, all of that. But you have a small space. You have a kitchen that opens onto a living area, which is very good. But the developer was creative, too. The company took a studio and connected it with a one bedroom and made a two bedroom. This allowed them to use the entrance to the studio as a larger plaza and an office space. So, we were able to pull lines in there and utilize this space for their computer or laptop. We were also able to develop usable space from some of the closets, while still maintaining closet space in the bedrooms.

DMB: That seems to be a theme here. Maximize, utilize to the fullest. How about furnishings?
JS: Well, we had to custom design a lot of the furniture there. We made tables lower, for example, which makes the ceilings appear higher. And, the developer also did some unique features to reawaken those existing hallways.

DMB: How is the market dictating what you are building?
BG: Technology is key. We need to make sure the units are wired for everything. The work-from-home trend is a big deal, and wireless technology is certainly important.
JB: It’s an always-on environment. We have people constantly walking around with their PDAs and constant inputs.
SB: Well, we’re doing media rooms in some of our spaces—places that collect all of these inputs. Big-screen TV, computer, that sort of thing.
JB: So many of these places have concierge services where you can check in through a media center to see what’s going on in downtown Phoenix tonight.

DMB: And this is also good for empty-nesters, too?
JS: Allied with this is that so many of these buyers don’t want to do anything. They just want to turn the key, get their car, which has been brought up by the valet service and drive away.

DMB: Are we becoming more cosmopolitan with our living needs?
DL: We talked about Tempe, that it has so many of these components for urban living in place. For one, they have to be safe. And, there have to be schools in place. You have to have services and, fourth, you have to have things to do. That’s what we’re doing in the warehouse district of Phoenix, to make a segue into an entertainment strip they are working on. If you’re missing one, that’s not good. Tempe has it all.

DMB: At Centerpoint in Tempe, you are actually trying to embrace the street.
JB: Yes, the front plaza of the project is the front yard.
BG: Of course, it’s not for everybody. When we were developing Kierland, we actually looked at Mill Avenue.
JB: Tempe is its own model and Kierland is a different and very successful model. Each can be successful in its own way. What it all comes back to is location. You can build a small unit because you have all of the other amenities around you. These young people coming out of school, they are used to spending time in an urban environment, so that they can go out shopping, sitting at the street café. It’s an extension of their living space.
JS: I have two questions. As the economy levels off, will the excitement level off about these spaces? And, the lifestyle issue. I may walk down the hall and run into people I may not want to see. I think one of the high rises, perhaps the Esplanade, advertised that someone may knock on your door for a cocktail party. Well, maybe that’s too much. Where’s my privacy?
BG: To the question of are we overbuilt: I think we can all name the projects that are going, which are working. Most developers are not going to get building until they have a substantial number of presales, so it’s not going forward if it’s not going to work.
JS: I don’t think we are quite there yet. I would be concerned about the ones on the boards.
SB: We’ve got 10 or 12 towers on the boards and not all of them are going to happen. It depends who pulls the trigger first. The developers all seem to be waiting there on the next guy.

DMB: More for the high rises or the lofts?
SB: I see it more for the high rises because of the costs involved.
DL: We have two things that are happening in this state that are not happening elsewhere. One is population. As long as we are getting more people at the rate that we are getting them, I am not sure that we will have this sort of bust. If population levels off, then something else may happen. The other part of this is that the mayor in his recent “State of the Downtown” address said that the goal is to have 10,000 people downtown. So, align that with housing, and go and find 50 or so available pieces of land for the new developments. The answer is that you have to go up. And with high rises, as you know, there are often years of the entitlement process to go through.

AZ Business MagazineDMB: We have to sum up. Let’s go around the room for some closing thoughts.
SB: As an architect, I like these projects because they come with a program, rather than just a series of specs and spaces. I think this kind of project is gong to continue to happen more and more in Phoenix. My only concern involves construction costs and their escalation: These projects could become both unaffordable to build and also to sell.
BG: I think we also need to revisit how buildings are built. Over the next 10 years, I think there will be a lot of changes coming on line.
JB: I’ve been here for 10 years now, from Chicago. I came out here for school, but I stayed out here because I thought the opportunity here was greater than it was in Chicago. When I first came out, from a younger generation’s perspective, Phoenix was a stop to somewhere else; now it’s become a place to go. These projects are part of that evolution. These monumental buildings help to create urban density and a city. This is why we are all here, to execute these kinds of projects. They contribute to the vitality of the economy, of the city.



Arizona Business Magazine Aug/Sept 2006

AZ Business Magazine Aug-Sept 2006 | Previous: Gone Fishing | Next: Mi Casa, Su Casa

Arizona Majority

Surging Hispanic Population Growth Creates Opportunity, Challenges

Arizona’s Majority Minority

Surging Hispanic population growth creates opportunity, challenges


Arizona’s population is changing as fast as its landscape. At present, approximately 1.6 million Hispanics, or one in four Arizonans, call the Grand Canyon State home. Since 40 percent of the state’s population now consists of Hispanic and other minority residents, the U.S. Census Bureau estimates Arizona will soon be joining Texas, California, New Mexico and Hawaii as a “majority minority” state.

majority_minorityHispanics are the biggest and fastest growing minority group in Arizona, in its K-12 schools and in the United States, according to Datos 2005, an annual report released by the Hispanic Chamber of Commerce. The number of Hispanic Americans grew by 40 percent between 1990 and 2000 and 49 percent from 2000 to 2004. Between 2000 and 2020, Hispanic growth is estimated to outpace that of non-Hispanic Whites by nearly 2 to 1. “Local businesses need to focus on the Hispanic market,” says Dr. Loui Olivas, assistant vice president of academic affairs at Arizona State University. “Whether businesses do an effective job will be measured through the metrics of customers, billing and revenue by market segmentation. But unless, and until, businesses grasp the numbers and clearly identify what they mean, the Hispanic market will continue to be a lost opportunity for many of them.”

Harry Garewal, president and CEO of the Arizona Hispanic Chamber of Commerce, recommends local business owners utilize published data to learn about the Hispanic market. Datos 2005 is a 10-year culmination of demographic and census data that can help businesses understand the changing Hispanic market, and in turn, help them develop a sound marketing strategy for selling products and services to the Latino community. “Businesses will have a better chance of developing a good marketing strategy if they understand the market,” Garewal adds. “That includes understanding that all Hispanics are looking for the same things as everyone else—opportunity, good quality of life, education and what brings happiness in life.”

Avondale Mazda, an independently owned used car dealership that opened in November 2005, used the Datos report to develop its first marketing strategy. Since close to 50 percent of the local community and its customer base are Hispanic, the report was extremely helpful, says Xavier Brizar, Avondale Mazda’s Hispanic marketing and business manager. “Datos helped us gain a better understanding of the Latino market and the information was easy to understand,” he adds. “In the dealership world, no one in the past would consider using direct mail, but we learned from the report that Hispanics do read it, so using direct mail has been very successful for us. We also know the Latino market uses the Internet (13.6 million Hispanics online), so we have an Espanola link on our Web site to direct them to an Avondale Mazda site in Spanish.”

Avondale Mazda has banners, signage and information about buying cars in Spanish inside the dealership, which makes Hispanic customers feel welcome and comfortable. The dealership also is involved in the Hispanic Chamber of Commerce and is supportive of local community events. “This is a small dealership with only 40 employees, so if someone calls that speaks Spanish, they get to talk to me every time,” adds Brizar, who prior to Avondale Mazda spent 18 years as the marketing manager of Pioneer Ford, where 50 percent of customers were Hispanic. “We know our Hispanic customers want to speak with a person, so it’s important we take care of them in the manner they appreciate.”

Home furnishings retailer IKEA launched a Hispanic multimedia marketing campaign in the United States in late 2004. The ongoing campaign includes Spanish-language TV and radio commercials, print ads, a 300-page Spanish catalog, store signage, product information brochures in both English and Spanish and sponsorships. They also have Spanish-speaking employees in stores. “The Hispanic market is vital to our business,” says Maria Lovera, IKEA’s deputy marketing manager for general and Hispanic markets in the United States. “We’ve always seen it that way, but in the last couple of years, we have strengthened our efforts to address their unique needs and understand their culture. We have also allocated more money for our Hispanic marketing efforts and made a very significant increase in our advertising budget. We feel this is a fast-growing market that is going to be phenomenally successful for retailers who can understand the benefit and embrace the Hispanic community.”

Phoenix is a top 10 Hispanic television market. Hispanic consumers spend an average of 58 hours per week watching television. Arbitron ranked Phoenix as the ninth largest Hispanic radio market reaching 742,000 Hispanics more than 12 years old. Nearly half of Phoenix Hispanics read a Spanish-language newspaper compared to half as many reading an English-language daily.

The Hispanic marketing team at Qwest has used Datos every year since 2000, as one of its tools to compile demographic and census information on the local and regional Hispanic market. They also use it to compare differences year after year in population growth, household growth, buying trends and purchasing power and to develop the company’s marketing strategy. “Datos comes in handy for the Arizona market in particular because it has the lionshare of the Hispanic market in our region,” says Hector Placencia, marketing director for Qwest. “Arizona’s population changes year to year and the updated reports keep us on the curve of these changes. There are many tools out there, but for us, Datos speaks to our customer base. We also share it internally with senior management to raise awareness of change within the Qwest organization.”

AZ Business CoverBased on the growth of the Hispanic population in Arizona over the last year, Qwest, like IKEA, has allocated additional monies for marketing and advertising to the Hispanic community. The fattened budget also includes face-to-face events. “The Hispanic consumer likes to do business in person,” says Alex Juarez, marketing manager for Qwest. “So we partner with businesses in the community like Food City where we have Qwest kiosks set up to meet with them face to face. It works out great because we understand our market very well.”




Arizona Business Magazine Aug/Sept 2006

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Mega Retailers

Mega Retailers Provide Optimum Outdoor Opportunities

Gone Fishing

Mega retailers provide optimum outdoor opportunities, but how do cities lure them here in the first place?

By Mica Thomas Mulloy

Glendale and Mesa may as well be bringing amusement parks into their respective towns. Upcoming additions to the cities are expected to draw millions of visitors each year—many traveling from hours away—and infuse hundreds of millions of dollars into municipal coffers. But it isn’t Disneyland and Six Flags opening their doors in the Valley; rather outdoor mega-retailers Cabela’s Inc. and Bass Pro Shop.

gone_fishingCabela’s plans its grand opening at the end of August in the Zanjero Business Park near Glendale’s Westgate City Center. Bass Pro Shop recently broke ground in Mesa’s super-sized Riverview retail center at the confluence of loops 101 and 202. Both sporting megaliths are highly coveted and, much as IKEA put Tempe on the retail destination map, are expected to edge West and East Valley commerce opportunities toward retail nirvana.

Born in the ‘War Room’
Cabela’s opens in the midst of Glendale Arena and Cardinals’ stadium to offer West Valley residents a super supply of hunting, fishing and outdoor gear. Cabela’s spokesman David Draper says when his company looks for a retail location, executives first examine their mail-order customer base. They literally pinpoint their customers on large maps in their retail “war room” and determine if there is a large enough demand. With countless recreation opportunities in Arizona and metropolitan Phoenix, Glendale was a good match. “Obviously there is a great opportunity there,” Draper says.

Cabela’s purchased a 28-acre site in September 2005 and anticipates hosting 3 to 5 million customers in its first year. The store will feature acres of sporting displays, a freshwater aquarium and a centerpiece mountain replica complete with running waterfalls and streams.

The retailer received some help along the way—Glendale foot the bill to add necessary infrastructure as a development incentive. “The way we look at it, we are bringing something to the area,” Draper says. “To put our store there, we are going to need some infrastructure.” Glendale Economic Development Director Karen Thoreson says the city agreed to build public improvements based on the calculated financial boom Cabela’s should bring: an estimated $34.6 million in tax revenues over 10 years. “It’s bringing in a lot of business around it, it’s bringing in a lot of people who have never been to this side of the Valley,” she says.

Thoreson believes the area will experience supplementary benefits upon the mega-retailer’s arrival such as more than 1 million annual tourists and the addition of 300 new hotel rooms worth $30 million. “People come to Cabela’s like they come to Disneyland,” she says.

How to Land a Retail Giant
Marty DeRito, DeRito Partners CEO and Riverview developer, wanted to kick off the 250-acre commerce center with a unique anchor tenant. With that in mind, he, project partner Kimco Developers and Mesa economic officials started pursuing IKEA and Bass Pro Shop. When IKEA signed on with Tempe, all focus moved to Bass.

DeRito notes Bass Pro Shop, which sells everything outdoors from boats to bait, was interested, but also looked elsewhere in the state and toward California for their next location. “I had as much competition from other states as I did locally,” he says.

A Mesa contingency traveled to the International Council of Shopping Centers convention several years ago to meet with Bass Pro Shop executives and tout what Mesa, and the entire region for that matter, had to offer the retailer.

DeRito said Riverview will ultimately house three to five auto dealerships, 1.5 million square feet of retail space, 400,000 to 500,000 square feet of office and commerce facilities and two hotels. The center is expected to employ 5,000 to 6,000 people, making it one of the largest employers in the region.

After two years of negotiations, Bass Pro Shop was hooked and signed a letter of intent. Larry Whiteley, Bass Pro Shop manager of corporate public relations, says regardless of what a developer offers, all the puzzle pieces must fit together perfectly before the retailer makes a move. “They could offer the moon, but it still has to be right for us,” he says. “We have to research it ourselves and find out if there is a built-in customer base.” Bass looks at the number of hunting and fishing licenses sold in an area, zip code reports of catalog sales and the area’s outdoor activities. Whiteley says in Mesa’s case, everything fit. “We wouldn’t be considering this and doing this if we didn’t feel confident with this,” he says.

With Bass Pro Shop now on board, DeRito Partners and Mesa came to terms on an incentive package for the project. Developers agreed to front $42 million needed to get the center on its feet with the possibility of earning that money back in coming years with shared retail-generated sales taxes.

AZ Business MagazineDeRito says if the center, and therefore the city, makes money, the developers earn some of their down payment back. If not, it is the developer who will suffer, not the tax payers.

Mesa Economic Development Management Assistant Scot Rigby says the incentive package is a win-win situation for Mesa, and the region as a whole. “Since you’re performing, since you are truly becoming a benefit to the city, you are eligible for these types of incentives,” he says of the plan’s structure.

Rigby believes Bass Pro Shop’s agreement to build in Mesa speaks volumes not only for the store and local citizens, but also the economic viability of the entire valley. “The region is showing national retailers that they need to be in Arizona if they are going to be successful in their plans as a business,” he says. “It’s too big of an area for them to overlook now.”


Arizona Business Magazine Aug/Sept 2006

AZ schools

Schools Feel The Pinch When It Comes To Growth In West Valley

Growing Pains

Schools feel the pinch when it comes to growth in the West Valley

By Lori K. Baker

It’s back-to-school time. Will the children in the West Valley’s new residential developments have a neighborhood school to attend? At first, that question might strike you as odd. After all, many consider school the cornerstone of the neighborhood, something you automatically count on to be there. But officials in the West Valley’s fastest growing school districts say it’s not correct to make that assumption. “People assume there’s a place for their kid to go to school, but logistically it isn’t always so,” says Pete Turner, superintendent of Liberty Elementary School District in Buckeye.

growing_painsTwo potent forces have converged in the West Valley to create a school shortage: rapid growth and a school funding formula that fails to keep pace.

Mark Maksimowicz heads Dysart Unified School District, one of the Valley’s fastest growing districts. In the 2005-2006 school year, the student population shot up by 3,500 students, more than a 25 percent leap for a district with approximately 18,000 students. In a perpetual game of catch-up to meet the demand for classroom space, DUSD is expected to open four new schools in the 2006-2007 school year.

The long-term outlook looks even more daunting for the Liberty District. While it ended last school year with 3,000 students and five schools, Liberty is expected to have 35,000 students and 45 to 50 schools by 2020. “But that depends on what happens in the housing market over the next 15 years,” Turner says.

That means 15 years of wrestling with overcrowding for Turner and other West Valley superintendents, unless the state’s schools funding formula is changed.

The old school finance system relied on the secondary property tax, driven by the assessed valuation of a school district and general obligation bonding. In the old system, school districts could ask for voter approval for bonds of up to 15 percent of the school district’s assessed valuation as a way to keep pace with growth.

But all that changed in 1994, when the Arizona Supreme Court decided that the funding formula was unconstitutional in the landmark case, Roosevelt Elementary School District No. 66 v. Bishop.

Four years later, then-Gov. Jane Dee Hull signed legislation that dramatically reformed the way K-12 schools are constructed in Arizona. The legislation is known as Students FIRST (Fair and Immediate Resources for Students Today). Students FIRST moved responsibility for funding school construction and other capital items away from local districts to the state and phased out those local property taxes used to support capital expenditures. The new law created a state School Facilities Board to administer the system.

“I don’t think anyone realized at the time what was about to happen,” says Roxanne Morris, superintendent of the Saddle Mountain Unified School District in Tonopah.

Rapidly growing districts found it nearly impossible to keep pace with growth. The funding formula multiplies the number of students by the square footage and cost per square foot to determine the allocation. “By the time you can even begin construction you’re already overcrowded in some—if not all—of your schools,” Turner says. “Construction of a new school takes between eight to 12 months, so sometimes when a school opens, it’s already full. It makes it very difficult to keep up with growth without having overcrowded schools.”

Meanwhile, developers say the School Facilities Board’s cost per square foot doesn’t reflect the fact that construction costs have catapulted over the last few years. Barry Chasse, vice president of Adolfson & Peterson, developer of numerous Valley schools, says his company has seen a 30 to 40 percent hike in construction material costs—namely steel, copper and petroleum-based products—over the last two and a half years. Labor costs have also jumped 15 to 20 percent over the same period, he says. “The funding levels are inadequate in today’s dollars,” he says.

A solution? “It’s time for the School Facilities Board to be revisited,” says Jack Lunsford, president and CEO of WESTMARC. Fellow WESTMARC member Herman Orcutt, partner of The Orcutt/Winslow Partnership, says schools are a key component in the future of the West Valley’s successful economic development. “The quality of schools is an important fabric of the community,” he says. “Higher quality schools bring up the level of residential, commercial and business development.”

AZ Business MagazineMeanwhile, savvy school district officials like Morris are discovering ways to free themselves from state funding straitjackets. She’s discovered a key is forging successful partnerships with developers, such as Joel H. Farkas, chairman of JF Companies. Forget golf courses and greenbelts. Farkas believes the wisest investment for developers is the neighborhood school. “Of all the things we could possibly do as a developer, that’s the most important,” he says.


Arizona Business Magazine Aug/Sept 2006

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West Valley Looks To Improve Transportation Efforts

Finding Solutions to Gridlock

West Valley looks to improve transportation efforts

By Debra Gelbart

Transportation issues affect the entire Valley of the Sun, of course, but they are particularly weighty in the West Valley, where lack of sufficient freeway miles and the dearth of motorist-friendly roadways are taking a toll on commerce, economic development, tempers and safety. “We simply don’t have the freeway miles that the East Valley does,” says Glendale Mayor Elaine Scruggs, who also chairs the Maricopa Association of Government’s (MAG) Transportation Policy Committee. “In the West Valley, we have too many people traveling on arterial streets, which hurts the quality of life within a city.”

find_solutionsShe says other areas of the Valley are able to concentrate on different aspects of transportation besides freeways. “Phoenix is focused on building light rail and expanding bus service. The East Valley is improving arterial streets,” she says. “But here in the West Valley, we’re still trying to get enough freeways to manage our explosive growth.”

It’s more than just an issue of convenience. “The seven-mile stretch of Interstate 10 that passes through the city of Goodyear—between Perryville Road on the west and Dysart Road on the east—is a major corridor of commerce for products from Asian manufacturing centers off-loaded at the Los Angeles ports,” says Goodyear Mayor Jim Cavanaugh, “and because of the narrowing of the freeway here [there are only two lanes in each direction], traffic backs up terribly. We’ve investigated and found that these seven miles have 10 times the number of traffic fatalities compared with the national average for the 2,500 miles of Interstate 10 across the nation. And we know that this leg of I-10 accounts for 35 percent of all traffic fatalities on I-10 within metropolitan Phoenix.”

The reality is that the commute from the West Valley to Phoenix has become unbearable, says Jay Ellingson, vice president of land development for SunCor, developer of the master planned community of Palm Valley. In January, Ellingson will become chair of WESTMARC, the Western Maricopa Coalition, which brings together representatives of business, 13 local governments and educational organizations to advocate for sound public policy in the West Valley. “We’re just not given the attention we deserve by employers and educational institutions,” Scruggs says, “in part because it’s difficult to travel from and through the West Valley because of so few freeway miles.”

Cavanaugh has been instrumental in securing relief for the congestion on I-10. Originally, I-10 between Dysart Road and the Loop 303 at Cotton Lane was not supposed to be widened until 2011. But because of the efforts of Cavanaugh, other Goodyear officials, leaders from the cities of Avondale, Buckeye, Litchfield Park, MAG and the Arizona Department of Transportation, the widening project will now get under way in 2007. “By late 2008, we will have four lanes in each direction,” Cavanaugh says. “By early 2010, we’ll have five lanes in each direction.”

Jack Lunsford, president and CEO of WESTMARC, says accelerating the widening of I-10 will have a dramatic effect on businesses. “If your people are sitting in traffic for an extra half hour at any given time, that results in a decrease in productivity,” he adds.

Accelerating the widening of I-10 is critical for the people who live in the West Valley, adds John Bradley, general manager of Verrado, DMB’s master planned community in Buckeye. The residents of Verrado may be able to look forward to the I-10 widening from Loop 303 to State Route 85 possibly beginning in 2013 rather than 2023, as originally planned. Currently about 2,000 people live in Verrado; at build-out in 2017 it’s expected to be home to as many as 30,000 residents.
The widening of I-10 is one of three freeway projects that will affect the West Valley. Another is extending Loop 202 from I-10 linking I-10 in the West Valley to I-10 in the Southeast Valley. Construction would start in 2009 and finish in 2015.

AZ Business MagazineThe third freeway project affecting the West Valley is construction of Loop 303, located about 10 of miles west of Loop 101 and currently a two-lane roadway extending from McDowell Road to Grand Avenue in Surprise. Future construction of what will be called the Estrella Freeway will link Interstates 10 and 17 in the far West Valley, but the six-lane freeway won’t be completed until about 2014. “All of these projects are vital now to moving traffic more efficiently and effectively in and around our West Valley cities,” Lunsford says, “and they will be critical in the West Valley’s ability to accommodate and manage future growth.”

Scruggs says the West Valley’s time in the spotlight is overdue. “The West Valley still isn’t recognized for the role it plays in Maricopa County,” she says. “The center of the Valley is shifting westward, to right around Loop 101 and Glendale Avenue. The way the West Valley is perceived will begin to change when we get the freeways we need.”


Arizona Business Magazine Aug/Sept 2006

AZ Business Magazine Aug-Sept 2006 | Previous: Policy Agenda | Next: Home Run


Baby Steps

Hispanic Chamber To Push For Guest Worker Program

Baby Steps

Hispanic Chamber to push for guest worker program

By David Schwartz

They are the lessons pulled from the history books and reinforced in the mind of a 12-year-old boy working in the picking fields of Holtville, a small agricultural enclave in Imperial Valley, Calif. It was there that young, macho Harry Garewal learned first-hand about the importance of immigrant labor, schooled on the tricks of the trade from the guest workers at the time as he harvested crops of carrots, onions, watermelons and tomatoes.


baby_stepsBeyond wearing long sleeves in the blaring sun and using overripe tomatoes to wash away the insecticides, the youth cultivated a broad realization that sticks with him today. “This country has been reliant on imported immigrant labor since its inception,” says Garewal, president and chief executive of the Arizona Hispanic Chamber of Commerce. “That’s the way it has been and always will be. That’s what this issue is all about. Our labor market is based on supply and demand. There is a demand for these workers. And we need to have a program in place that gets the job done.” That’s why the 567-member chamber now is pushing for a federal guest worker program with renewed vigor, backed by small and medium-sized businesses who overwhelmingly have said they want the group to get involved in public policy issues.

Starting first with “baby steps,” Garewal says the chamber plans to add a stronger voice than ever before to the immigration debate as the nation struggles with a solution to what most agree is a broken system. Congress is expected to hold public hearings around the country this summer to listen to what the American public has to say about the divisive issue. This as President George W. Bush has made immigration reform a top priority and a guest worker program a key element in his plan.

Garewal says the timing could not be better for the chamber to play a more active role on an issue that hits hard locally, potentially harming Arizona’s robust economy. “Before, we served as an information highway and voiced our opinion to people,” says Garewal, who has led the chamber for three years. “Now, we’re going to do a little more.”

He says future plans tentatively call for the chamber to join or start a political action committee and hire a part-time lobbyist to rally support. Chamber members also would be trained to help make the case for reforms.

Chamber officials are working from a document that was passed by its public policy committee about three years ago, stitched together after a meeting with congressional leaders and staff members from Arizona. Outlined in the one-page proposal are the key reasons for a federal guest worker program and six tenants that such an effort should contain.

Jessica Pacheco, the committee’s chairwoman, says the policy seeks to move beyond the politics and heated rhetoric swirling about the issue and provide businesses with badly needed workers at a time when the labor market is wound tightly.

“What we wanted to do was bring some facts back into the conversation,” says Pacheco, an Arizona Public Service Co. executive. “The fact is that we need temporary workers to fill jobs in this country. We frankly don’t have enough bodies to do certain jobs.”

She says a guest worker program is not about amnesty or a path to citizenship—two thorny issues that often cloud the debate and prevent clear-headed measures from progressing. Pacheco also says that changes are needed to improve the system now, allowing employers to determine whether prospective employees are legal. “Any thoughtful business person in this country believes there is a need for a guest worker program,” Pacheco says. “It’s just good for business.”

AZ Business MagazineRay Gonzales, president of RBG Construction Co. in Glendale, says a guest worker program is long overdue and that the workers are vital to the industry and others statewide. “It would really hurt if we tried to get rid of these people instead of making it right for them,” adds Gonzales, whose decade-old company employs about 80 workers. “It’s a shame that we fail to recognize that immigrants bring success to whatever it is and wherever we are using them.”

In the end, Garewal believes long-awaited immigration reform—one with a guest worker program at its heart—will be passed into law in the near future. “I think we will come to an agreement in this country for systematic improvement,” he says. “It may take a couple of years to iron out the details, but it is going to happen. It has to happen.”





Arizona Business Magazine Aug/Sept 2006

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Wineries Win Battle At Capital

Southeastern Arizona:
The Border Report

Significant business developments promise to fortify the economies of Arizona’s southern half

By Peter O’Dowd

After battle waged at the Capitol, local wineries still in the game. Poised to enter the State Legislature with a litigious flurry, Arizona wine growers dug in for a fight of David and Goliath proportions. When the dust settled and the vote was cast, the underdog had defeated a lobbying giant, leaving an unencumbered path for the future of the state’s wine industry.

border_reportThe history of Arizona wine law is tangled in a bevy of U.S. Supreme Court cases and litigation in states that were previously consumed with distributing regulations. In a nutshell, with the approval of Senate Bill 1276 last May, Arizona wineries reaffirmed the right to self-distribute to restaurants and retailers. Smaller wine growers also secured the privilege to bypass wholesalers and ship directly to consumers via telephone, mail and Internet sales, or set up satellite tasting rooms and retail outfits away from their remote locales. These steps, which wine growers say are essential to their survival, were not allowed under previous legislation.

“You have to understand how dominate the wholesale part of the liquor industry has been for years from a policy standpoint,” says Rod Keeling, president of the Arizona Wine Growers Association and owner of Keeling-Schaefer Vineyards in Pearce, Ariz. “They were in total disbelief that a bunch of guys with dirt under their fingernails could come up here and convince the legislature that they ought to do something for us instead of something for them. I’m still not sure they know what hit them.”

Keeling and his colleagues feared wholesalers would convince lawmakers to revert back to a three-tier system that mandated even small wine makers sell to wholesalers who would then distribute to retailers, and ultimately, consumers. Keeling says an 11th-hour compromise between the groups was preferable to the lawsuit his organization would have brought if boutique growers were forced under the three-tier system. “That would have been death,” he explains.
So, instead of a deathblow, Arizona vineyards are in a position to expand. Kent Callaghan, who has received international attention for his varietals crafted 30 miles from the Mexican border, says offsite retail presence gives growers more options to stay in business. “Certainly you’ll see an increase in quality and quantity,” says Callaghan, who claims improvements are already brewing. “Nobody associated Oregon or Washington as a wine growing area 30 years ago. It took a while for the state’s wine to catch on with its residents. The same thing is happening here where people have stopped immediately acting negatively toward Arizona wine.”

Keeling agrees, but doesn’t shy away from past shortcomings. Five years ago he could only stomach two Arizona labels. Now he drinks six or seven. “We’ve added a lot of quality producers,” he says. “They are smarter, more committed to quality, not using the tourism model; it’s not being sold as a novelty but on its own merits. Kent Callaghan deserves all the credit for that.”

For years, Keeling says the state was stuck at eight or nine wine growers, but in the last two years that number has swelled to 22. What used to be a state of 12 or 13 vineyards is now the home to 32. Perhaps most telling are the production numbers: 15,000 annual gallons four years ago compared to 47,000 gallons today.

Indeed, the gears may already be moving and some predict Willcox will become the state’s vineyard epicenter. Amid favorable water and weather conditions in Cochise County, experienced wine grower Dick Erath bought 200 acres close to town. As these seasoned experts employ Arizona’s nascent vineyards, the relatively small knowledge base grows, techniques improve and the industry blossoms.
Of course, favorable legislation doesn’t hurt either.

Extra Lanes Slash 4-hour Border Wait
Nogales, Ariz.—Port Authority officials here anticipated a July completion of two additional commerce lanes linking Mexican and U.S. boundaries that would reduce agonizing wait times at the border. The $4.3 million expansion brings to four the number of lanes motorists and commercial trucks use to cross the border. Terry Shannon, chairman of the Greater Nogales-Santa Cruz County Port Authority, says the Mariposa Port of Entry can process 300 trailers effectively per day, but in reality 1,400 trailers line up daily on either side of the border. The glut creates an average wait of four hours. This is the first step in a larger plan to reconfigure the port. $9.8 million is secured in the 2007 presidential budget for a port with capacity for 3,000 trucks per day.

SlimFast Site to Can Beans, Not Shakes

Tucson, Ariz.—The former SlimFast manufacturing building in Tucson has been vacant for nearly two years, but plans are under way to fill the 440,000-square-foot plant with food of a different fare. Arizona Canning Company LLC, of Mexico, announced in June the building would house its U.S. headquarters, bringing 200 employees to the region in the next three years. The majority of the recruits will be from the Tucson area. By summer 2007, Arizona Canning Company plans to buy raw material from U.S.-based suppliers, receive it in Tucson, process and sell the plant’s output to U.S. markets across the country. “This will be a huge win for Tucson,” notes Joe Snell, TREO President & CEO.


Gasified Coal Emits a Fresh Breath

Bowie, Ariz.—Developers of the 600-megawatt Bowie Power Station announced the electric generation facility planned for Southeastern Arizona will now incorporate environmentally sensitive coal technology. The project will gasify coal before combustion for cost-effective generation while protecting the environment, creating local jobs and economic growth. Developers say the project will lessen Arizona’s dependence on natural gas for electric generation. “This is unlike a conventional coal plant where its pulverized and burned,” says spokesman Ian Caulkins. “In this case, mercury, sulfur and other contaminants are removed prior to combustion.” Bowie is expected to outperform the efficiency and emissions of existing coal power plants, which will make it one of the cleanest coal plants in the world. The Arizona Corporation Commission has already granted a certificate. All remaining regulatory requirements will be completed by 2007 and construction will then begin as soon as possible with commercial operation expected in 2012.


AZ Business MagazineSuperior
Broadband a Boon to Local Businesses

Superior, Ariz.—Until recently, sending large files over the Internet was an exercise in patience for business owners in Superior. But a gift from the Arizona Department of Commerce will funnel in $35,000, bringing high-speed broadband infrastructure and the potential for hundreds of new jobs.
Superior businesses were hindered with limited dial-up connections, which severely limited communications, ordering products online and carrying out tasks as simple as e-mailing digital photos. “Our business has suffered as a result of our inability to access reliable infrastructure,” says Rozlyn Lipsey, a Superior business owner. Several local businesses have provided $1,000 matches to fund the project. The town has dedicated $25,000 and applied for an additional $270,000 from the federal government to enhance the initiative. An award announcement will be made this fall. Officials expect the improved connectivity will allow business the chance to grow, facilitating 300 full-time jobs.


Arizona Business Magazine Aug/Sept 2006

AZ Business Magazine Aug-Sept 2006 | Previous: Metro Report | Next: Colorado…

Home Run

Playing The Economics Of Sports In The West Valley

Home Run

Playing the economics of sports in the West Valley


It’s not so much a case of “if you build it, they will come” that is turning the West Valley into a sports mecca. Rather, it’s the other way around. People have come to the West Valley in droves, setting the stage for an economic explosion and a sports megalopolis. The Arizona Cardinals stadium opens this month, the NHL Phoenix Coyotes play in adjacent Glendale Arena, five Major League Baseball teams conduct spring training at West Valley sites with two cities avidly seeking other teams to call their own and Phoenix International Raceway stages two major NASCAR races a year.

home_runEconomist Elliott Pollack says population growth came to the West Valley first. Contrary to the view of some, Pollack says, “The Phoenix area grows like a balloon in a very orderly manner, at its periphery. Growth got to the west side and the area was looking for an image.”

He calls Glendale Mayor Elaine Scruggs “a very smart lady,” who took advantage of the situation—a population explosion and an abundance of available land. The growth is happening not only in Glendale but in Peoria, Surprise, Goodyear, Avondale and Buckeye as well.

Cardinals Stadium and Glendale Arena essentially created a focal point for that area. “It gave the media something to focus on,” Pollack says. “The area would have grown anyway, but now with a much better image than before.”

Julie Frisoni, marketing and communication director for the city of Glendale, agrees. “Growth is driving the West Valley expansion,” she says. “Much of the East Valley is built up and developed. In the next 15 to 20 years, 40 percent of all growth will be west of the 101 (Agua Fria Freeway).”
People moving to the West Valley expect good housing, quality jobs, entertainment and sporting options, restaurants and shopping opportunities, Frisoni says. “Glendale always has been a bedroom community, a place where people lived and went somewhere else to work and for entertainment. Growth demands the amenities you’re seeing spring up.”

With growth comes soaring land prices. When the deal for the Glendale Arena was struck in 2001, agricultural land there was selling for $2 a square foot. Today, commercial land at the Westgate City Center in Glendale carries a price tag of as much as $25 a square foot. In seven to 10 years, Westgate will have 6 million square feet of retail and restaurants.

Jack Lunsford, president and CEO of WESTMARC, a West Valley economic development organization, says the sports explosion is having a huge dual impact—direct and indirect—on the West Valley economy. The direct impact is fairly easy to calculate. For example, Lunsford says, each of the two NASCAR races are worth $200 million to $250 million to the local economy, and the 2008 NFL Super Bowl, $250 million to $300 million. Add to the mix the Fiesta Bowl and the NCAA Bowl Championship games, plus the hundreds of events, concerts and meetings to be held in the Arizona Cardinals stadium and Glendale Arena and the economic impact is huge, he says.

Spring training is yet another economic engine. The Kansas City Royals and Texas Rangers train in Surprise, the Milwaukee Brewers are in the Maryvale area of Phoenix and the San Diego Padres and Seattle Mariners share a stadium in Peoria. Glendale and Goodyear are on the hunt for Major League teams and appear serious about building their own stadiums. “In two years we could end up with eight teams in the West Valley,” Lunsford says.

Frisoni says Glendale has entered into an exclusive agreement with teams to discuss a potential spring training site. She won’t say how many or which teams the city is targeting or where a stadium site would be. “We are continuing to move forward,” Frisoni says. “We expect a resolution very soon.”
Meanwhile, the Goodyear City Council in March approved a site for a new spring training complex and gave the City Manager’s Office authority to seek Major League teams. Goodyear Mayor Jim Cavanaugh says the complex would be located on the Woods’ Family property east of Estrella Parkway near Yuma Road. The ballpark complex would include commercial, office, hospitality and residential uses.

AZ Business MagazineLunsford notes the indirect impact of the West Valley’s sports explosion is the retail and service development that those kinds of activities spawn.
Economist Pollack sees a change overtaking the West Valley, particularly in the Westgate City Center complex. “There was a lot of economic development going on during construction of the stadium and arena, bringing in retail and more revenues,” he says. “Hopefully the concept will be that people will go there, eat, shop, go to a game or a concert and then go home. Now, they go to a Coyotes game, get out of their car, see the game, get back in their car, and go home. There are not a lot of places to eat on the west side, and that will change.

“It’s not that the arenas created the growth, they created a focal point for growth. It’s going to be a sports and retail mecca that people from other parts of the Valley will go to see games and concerts.”




Arizona Business Magazine Aug/Sept 2006


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Public Policy

Hispanic Chamber Takes On Key Issues

Matters of Public Policy

Hispanic chamber takes
on key issues


From immigration reform to healthcare affordability, the Arizona Hispanic Chamber of Commerce is once again wading into the turbulent waters of public policy and its already tackling big issues. The chamber’s public policy committee became active again last September and its 25 members have been busy the past several months educating themselves on state and federal issues.

public_policy“As an arm of an organization that represents primarily small Hispanic businesses, the committee explores issues that affect chamber members on a daily basis and their ability to grow and thrive,” says Jessica Pacheco, committee chairwoman and chamber board member and treasurer. “Not all Hispanic small businesses view these issues the same. We have a lot of debate and dialogue.”

Immigration Reform
So far, the Hispanic chamber has let other chambers take the lead on immigration reform, but Pacheco says her committee has its opinions on one facet of this issue—penalties for employers who hire undocumented workers. The committee has no problem with employer sanctions as a concept but opposes them as a “stand-alone issue” outside the context of comprehensive immigration reform. In June, Gov. Janet Napolitano vetoed a House immigration bill that included employer penalties. Its membership favors comprehensive immigration reform and the Hispanic chamber prefers that Congress address this issue, Pacheco says. “I can’t imagine a more difficult business environment than with each state having its own immigration laws.”

Procurement Opportunities
This fall, the chamber plans to help Arizona launch a “disparity study” to demonstrate how the state awards contracts for goods and services. It wants small business to garner a more equitable share of state procurement dollars, possibly an additional 10 percent. The chamber teamed with a variety of organizations to raise funds to pay for the study. The U.S. Department of Transportation is expected to provide $450,000 and a like amount must be raised locally through a public-private partnership, according to Pacheco. The first meeting with local donors was slated for June 14.

Federal Estate Tax
“There is a misconception that the federal estate tax affects very wealthy Americans, but if you look at the structure of the tax, it really hurts small businesses, especially Hispanic small businesses where 90 percent of them are inherited by family,” Pacheco says. The chamber believes the tax should be eliminated and committee members are communicating with Arizona’s congressional delegation.

Healthcare Affordability
Every small business grapples with the cost of providing health insurance, Pacheco says. “We would like to see a reduction in the cost of health insurance plans offered in the small group market. We also want to increase the number of workers in small business that have health insurance.”

Tax Relief
AZ Business MagazineThe chamber supports tax relief for small business. It favors reduction in dividend and capital gains taxes and supports accelerated depreciation for equipment and software. “Software depreciation is critical because small businesses often have to purchase very expensive software for accounting and networking,” Pacheco says.

Access to Capital
The Small Business Administration provides considerable capital for small businesses and the chamber is keenly interested that the SBA continuing to receive adequate funding. “The SBA has been a great partner and we want to be sure our membership knows what is out there and available to them,” Pacheco says.




Arizona Business Magazine Aug/Sept 2006


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Scott Norton

Arizona Cardinals Stadium Plays Host To Outside Events

Beyond Football

When the pigskin isn’t flying, Arizona Cardinals Stadium plays host to an impressive lineup of outside events.

By Tiffany M. Obergfoll

Valley sports fans share their anticipation as Cardinals Stadium draws nearer to opening day this summer—an opening day that will offer a glimpse of what’s to come, as the state-of-the-art facility will host the annual Tostitos Bowl and the first of many super bowls in 2008.

beyond_footballLong ago outgrowing their devilish college stadium, the NFL team finally comes into its own on Aug. 12 against the Pittsburgh Steelers. The move even helped the Cards sell out of season tickets for the 2006-2007 season—an impressive feat for a team that holds more low attendance records than Super Bowl appearances.

But the stadium is more than the steel embodiment of a fan’s dream. The uniqueness of its design establishes it as one of the most efficient and versatile structures in the history of sports complexes. Already famous for its appearance on the Discovery Channel’s “Extreme Engineering,” the stadium’s 12-million-pound rolling function permits the natural grass field uninhibited access to the Arizona sun without the high cost associated with completely removing the roof. The design also eliminates humidity problems other facilities face while attempting to sun their fields indoors. Removing the Bermuda hybrid turf when it isn’t being trampled by 22 sets of cleats also allows it to heal better in its natural environment—the grass is, indeed, greener on the other side.

In addition to the agricultural benefits resulting from the hour-long field exodus, the stadium’s interior is entirely transformed by the absence of its playing field. Teeming with 160,000 square feet of open, climate-controlled convention space uninhibited by columns or other impediments, the field-less stadium interior is fully geared with an electrical grid and ready for large-scale events. Global Spectrum, the facility’s management company, has booked everything from motocross events to food shows and women’s expos to maximize non-football revenue.

Working under contract with the Arizona Sports and Tourism Authority, Global Spectrum promotes and markets the multipurpose facility in accordance with Title 5 of the Arizona Revised Statutes, which requires the involvement of a third-party company. The Philadelphia-based firm also committed to finance the development of numerous spaces within the stadium.

Scott Norton, director of sales and marketing for the company, manages the building from an operational standpoint, “It’s cool and clean,” he says. “We have trade and consumer shows, private and public events, corporate and social functions, auctions—even weddings and proms.”

The stadium’s VIP Club rooms offer 39,000-square-foot lounge areas ideal for corporate and social functions, and the South-End Stadium Bridge consists of 12,500 square feet of open space overlooking the stadium floor. “We offer an unmatched setting,” Norton explains. “We don’t have a ballroom to hold a super-swank wedding, but we’re unique, especially for sports-minded people”—particularly those who do not mind an occasional Budweiser advertisement accompanying team insignia throughout the building.

AZ Business MagazineNorton, who has acted as Global Spectrum’s director of sales and marketing since March of 2005, is realistic about the facility’s appeal. “We’re not competing with the Marriott and the Phoenician,” he points out, shifting focus toward the unexpected and off-the-beaten-path appeal of Cardinals Stadium. Public tours are just one of the bonuses groups can opt for, and Global Spectrum’s large parent company, Comcast-Spectator, has many connections “to help book non-traditional, non-sports events.”

Of course, Glendale is quickly establishing itself as the metropolitan sports hub of the Valley, but the city’s newest megastructure demonstrates how innovation and efficient design allows both sports and non-sports events to flourish under one gigantic roof.



Arizona Business Magazine Aug/Sept 2006

AZ Business Magazine Aug-Sept 2006 | Previous: Eat & Tell | Next: Gone Fishing


Cover Story: State of the Navajo Nation

A president and the window to his Nation’s Future

By Peter O’Dowd

Somewhere on the Navajo Reservation, most often along Highway 264 between Arizona and New Mexico, a man holds his arm outstretched with a green flag fluttering from his fist. Instead of a thumb, the normal currency for hitchhikers in every other corner of America, the dollar bill is the fare he pays to do business off the reservation.nations_future

The scene escalates on the first of the month, on paydays, on weekends. On the busiest afternoons, a steady line of automobiles snakes from the center of quiet Window Rock, the Navajo capital, to Gallup’s commerce-laden main street. To some who worry about the state of the Navajo economy, the daily exodus is summarized by that single bill jutting from the hitchhiker’s hand—just one more dollar, among millions, sucked from the reservation.

Unemployment on the reservation is staggering, with estimates ranging from 35 to more than 60 percent. Miles of federal red tape has tangled generations of would-be entrepreneurs. Given one word to describe the Navajo business climate, those in the administration don’t shy away from pejoratives. Weak, they say. Hemorrhaging and tragic. Left unchanged, Patrick Sandoval, chief of staff to Navajo Nation President Joe Shirley Jr., believes the tribe will be bankrupt in 20 years. “Devastation,” he says, “if it’s not sooner than that.”

President Shirley has monuments to climb before delivering his constituents from financial purgatory. One of his latest challenges came last December when Navajos witnessed the shuttering of the Mojave Generating Station, a tangible symptom of economic malaise that sent a financial ripple through thousands of pocketbooks.

Still, there are signs of progress. For the first time in history, Navajos have approved gaming on the reservation. Plans are solidified to construct a major power plant that will deliver hundreds of tribal jobs. Dozens of economic development projects like these percolate through an arduous permitting process even as Shirley fights for a plan that would infuse the community with $500 million. But can business culture overcome the cycle of dependency that some call a way of life here? And in the midst of a presidential campaign, will politics unravel the entire process?

Dealings at the border
“I view the Navajo Nation growing like a giant oak tree,” says Shirley, in office since his election in 2002. “You don’t really see the tree growing, but you know its there. It’s a monstrosity; you can’t help but feel its presence.”

At any given time, Shirley’s administration can point to, and feel, a collection of monstrosities, whether it’s the nation’s double-digit unemployment rate, the complexity of its business leasing regulations or the bleeding of native dollars off the reservation. At last count, $2.75 billion circulated through the reservation from government funding, mom-and-pop shops and the countless ventures that support an economy. “Of that two and three-quarter billion,” explains Sandoval, “we estimate about 85 percent of it leaves the Navajo Nation…If we were a country suffering from those same types of economic imports and exports, we would close the border and say we’re going to end up committing suicide if we don’t do something.”

The problem is, as many will tell you, doing anything on the reservation can be complicated. The Navajo economy receives the majority of its dollars—Sandoval predicts up to 85 percent—from the Bureau of Indian Affairs and Indian Health Services. This dependency has perpetuated since the reservation was established in 1868, and an appendage of that relationship remains with the BIA’s business site leasing process. Critics say its existence is the most formidable barrier to Navajo economic development.

Because the federal government holds 17 million acres of Navajo land in trust, applications for business development must pass a series of stringent requirements: archeological clearance, appraisals, environmental assessments and legal surveys. Speaking before the Navajo Nation Council in 1996, Sen. John McCain said, “It takes three to five years to get the governmental approvals necessary to open a dry-cleaning shop in Window Rock. The same approvals can be obtained in Flagstaff in just three days.”

Allan Begay, Navajo executive director for the Division of Economic Development, says finding a single pottery shard on the premises can spark lengthy archeological investigations. To business hopefuls with limited resources, delays can be agonizing. “There has been an outcry from those with the entrepreneurial spirit against the bureaucracy that prevents them from getting from point A to point B,” Begay says.

There is reason to be hopeful, however. The Secretary of Interior approved in July regulations that will streamline the business-lease process. Omar Bradley, acting director of the BIA’s Navajo region, says in most cases the Navajo government will be able to sidestep the BIA altogether.

The bureau also continues to support and fund a program engineered to spur economic enterprises with loans from private lenders. Bradley says the BIA has requested a five-fold increase in the debt ceiling available to entrepreneurs. “Navajo really is at a crossroads,” Bradley says. “The implementation of the business-site leasing regs will give them an opportunity to step out and start grabbing a firm commitment on which way they want to go.”

While the business leasing issue hasn’t gone away, University of Colorado Law Professor Charles Wilkinson, who specializes in American Indian issues, says bureaucracy will continue to improve. “The business-lease approval situation is a vestige of the old-style, wet-blanket presence of the BIA,” he says. “It’s just a bureaucracy that grew over the years and much more than most bureaucracies. It was stultifying.”

Its past grip, however, has developed into today’s symbol of the hitchhiker en route to Gallup, Flagstaff or Farmington—communities that gleam with wealth when juxtaposed with their Navajo neighbors. Dan Brown, mayor of Page, says his local economy is buffeted by Navajos who not only shop, but also live in town. “Of the city’s population, approximately 30 percent of those are Native Americans, mainly Navajo.” he says. “I have a greater Native American population in Page than in the surrounding chapter.”

Of course, the anatomy of any economy is comprised of many parts. Even if proper permits are secured, can investors ever feel secure doing business in an environment where 95 percent of Navajo Supreme Court decisions have gone in favor of the government? And what of sovereign immunity—a tribal reality that protects the government from suit under federal common law? “How do you expect the world to do business with you if you enter into a contract and say, ‘I can sue you if you breach the contract; however, you cannot sue me if I breach it.’ Yet that is largely the position taken here,” a 2003 Navajo development report states.

Even as Shirley pushes for economic health, he and others realize some things will never change. There are those who see clinging to the status quo as dependency on decades of federal welfare; others simply call it the Navajo way of life—a cultural difference. “Do we even want to catch up?” Shirley posits. “Maybe we want to be who we are, the way that we are.”

A man with a plan
Shirley knows he’ll never recoup every cent siphoned away from the reservation, but he believes change can happen slowly—2 percent regained one year, 3 percent the next—so that decades from now doing business on Navajo land is not only attractive, but also a reality.

Early in his first term, Shirley proposed a $500 million financing plan that would have kindled scores of economic development projects: trauma centers, court houses and up to 10,000 jobs. The proposal failed to find support in the Navajo Legislature and ultimately died, but the president maintains its importance.

“Politics on Navajo land are fierce,” Shirley says from a cell phone between engagements scattered across the country. “That had a role in its failure, but the biggest hindrance was that this had never been done by any president or any legislature. There was talk about putting our children and grandchildren on hawk and I guess some thought it was a big risk.”

Some close to the president say if the bond package had passed, Joe Shirley would have had a “hell of a thing to hang up” on his reelection campaign. Meanwhile, with November’s election nearing, Shirley refuses to drop the issue, saying his administration still wants to take the risk. “We need to go out there and educate our populace to bring them to an understanding of what it means to talk economics,” says the president, who is pushing the federal government for a $500 million interest-free loan. If that doesn’t work, he’ll look beyond America’s borders.

“The Navajo nation is good for a loan,” Sandoval says. “We had banks from all over the world touting us, looking at our credit, saying ‘You can handle this.’ But the nation has never taken advantage of its credit rating.”

No one can put $500 million in the bank and expect the money to dispense itself. Sandoval says a capital infusion of that magnitude, which would nearly double the amount the nation now administers, requires skilled financial managers and better infrastructure. “You are essentially rebuilding a nation, but we were prepared to deal with that,” he says.

As the president continues his quest for half a billion dollars, other projects near fruition. Legislators secured the reservation’s first permanent casino after years of struggling to convey the value of gaming to its constituents. Those against the casinos believed it would interfere with their native culture, but after a major financial setback, Begay says feelings slowly shifted. “In the past years, people have known there is a chance of Mojave Generating Plant going under,” he adds. “People sensed there was much money to be lost.”

But can these new destinations compete with already established casinos? How big should they be? The administration is confident they have answers to these questions, especially as consultants begin locating suitable sites along Interstate 40 and near larger cities. Ultimately, Arizona could see four new Navajo casinos. “We want to turn that vacuum on to suck money out of other economies,” Sandoval says.

Equally ambitious is the Desert Rock Energy Project, a $2.5 billion venture—rife with long-term revenue potential—that Shirley calls the single largest economic development project on native lands. The coal plant, mine and transmission line will be one of the most significant taxpayers on the reservation. A latex glove facility, a Raytheon expansion and a handful of other proposals slowly add up, Shirley says. “In 20 years, we’ll be well on our way to a position of viability.”

Window to the future
From Professor Wilkinson’s perspective, excitement swirls over America’s tribal lands. The BIA is slowly lifting its lock on the reservations and shedding what he says was a long-held belief that American Indians were uncivilized and in need of a heavy hand to navigate through their incompetencies. “We are seeing a real revival in Indian country and certainly at Navajo,” he says. “Financial freedom is happening in spades. It’s not easy to take an area larger than West Virginia and make changes, but they are making changes and they are deep.”

Arizona Business Magazine Aug-Sept 2006Shirley fears economic progress will slow if he fails to regain office in the November elections, but Wilkinson suggests that no matter the result, the sight of Navajo politics at work, where candidates are elected and defeated, is the sign of good government. Navajos have stable policy he says, and “the staying power is unbelievable. They are not going to quit taking control over their homeland.”

So perhaps the hitchhiker, with his dollar fluttering toward New Mexico, will someday vanish from the reservation. Or perhaps he’ll keep his fist outstretched, reveling as all Americans do, in the choice to spend wherever he wants. But if President Joe Shirley has his way, every hitchhiker en route to Gallup, Flagstaff, Farmington or Page will someday have the choice to use that dollar on Navajo land. And in this corner of America, rich in everything but economic freedom, that would be the biggest victory of all.

Summer Ranch House

Western Mountain Cuisine At Hidden Meadow Ranch

Eat & Tell

Western Mountain Cuisine at Hidden Meadow Ranch is a Best Kept Secret No More


Rustic and luxurious Hidden Meadow Ranch, located just outside of Greer, is a year round, five-star-quality ranch offering high-end cabin rentals and property for sale along with a handful of outdoor activities, most of which are closed to the public. Fortunately, dining at the Lodge is one exception.

eat_and_tellHidden Meadow Ranch’s Lodge is a destination dining experience. Because it’s located in Northern Arizona’s high country, it’s not a place you pop in last minute. It’s a great incentive to take a scenic weekend road trip, perfect for celebrating a special occasion or as a reward for a day spent hiking or skiing. Approximately 15 percent of people dining at the Lodge come for the food only and are not cabin guests or living on property. A best kept secret no longer, this gourmet mountain cuisine is worth the drive.

The striking, 5,500-square-foot building made of hand-peeled logs is where all meals are served in casual elegance. During colder months, an enormous fireplace provides a cozy backdrop for the indoor dining area. When the ground thaws, meals are also served on a wrap-around porch overlooking a field of wildflowers.

A seasonal menu offers dishes with sophisticated, yet rugged flair. From main courses like stuffed pork loin with spinach wild mushroom phyllo to complimentary rosemary bread served with molasses-thick balsamic vinegar—Executive Sous Chef Joe Stoiber creates dishes with a delightful twist of the unexpected.

Food Review
Arizona Business Magazine Aug-Sept 2006Achiote-Marinated Elk Tenderloin—one of the best meals I’ve had. Ever. So good in fact, I wanted to order it for every meal thereafter: breakfast, lunchand dinner (and that’s coming from a borderline vegetarian). One bite and you’ll be a believer, too. The Lodge’s specialty and served year round, the New Zealand elk is teamed with braised red cabbage. The meat is remarkably more tender than the accompanying mushroom whiskey demi. Heaven.

Pan Seared Lump Crab Cakes—You wouldn’t think seafood served in the middle of a forest in Northern Arizona would be a party for the taste buds. Sometimes it’s nice to be wrong. Roasted corn relish and sweet Chile aioli accompany the appetizer that is just as tasty as it is pretty.

Green Chili Macaroni and Cheese—This supped up version of the staple comfort food has benign spiciness. The cheese gives it a thick, mild demeanor that kids and adults will enjoy.

Crème Brule—After breaking the caramelized surface of this favorite, the delicious body underneath has a pleasant cotton candy-like aftertaste.



Arizona Business Magazine Aug/Sept 2006

Waveyard Development

Valley’s Already Booming Economy Prepares For An Ambitious Future

The Metro Report

The Valley’s already booming economy prepares for an ambitious future.

By Peter O’Dowd

Surf park to bring millions to one lucky city and the entire region

Somewhere below this vast valley of dust and desert landscapes, an oasis is about to spring forth—a $250 million outdoor park on the scale of Disneyland but with an aquatic propensity previously unseen in Arizona.


Metro ReportWaveyard Development, founded by a life-long surfer and a former wireless executive, is capitalizing on the increased number of adventure sports enthusiasts flocking to Greater Phoenix. The plan is ambitious: a technological flurry of wave pools and whitewater rafting, kayaking and scuba diving—150,000 square feet of water surface in all—merged with a 320-room resort hotel, a conference center, retail, residential and restaurants on 200 acres. By incorporating these varied amenities into the master plan, Waveyard aims to become the nation’s first live, work and play surfing and adventure sports community. Developers cringe at the thought of calling Waveyard a theme park.

Wendell Pickett, managing partner of Greey-Pickett Landscape Architects, is leading the integration of Waveyard’s recreation and residential components. “Homebuilders are looking for the next growth driver in order to keep their pipelines full,” Pickett says in a prepared statement. “In a market of rising interest rates and declining demand, they need to remain competitive and add value to their product. The opportunity to surf, raft, snorkel, kayak and still be home by dinner is unprecedented in an urban environment.”

Developers Richard Mladick and Jerry Hug are keeping a tight lid on exactly where the park will break ground in 2007, though Mladick says the interest from several cities in the Phoenix area was extreme. Even as the group publicly gave the green light for development in June, a new municipality had come forward asking for consideration. “The impact on the city will be significant,” says Mladick, who spent the better part of his life in the ocean. “The city where it will be located has called this a transformational project. It will help define who and what that city is and drive the future growth around that city.”

However gung-ho the developers may be about their project today, the Waveyard concept started humbly. The original idea centered around a retail, entertainment and lodging concept with the potential to later bring in headline amenities like the whitewater course. But all signs pointed toward expansion when developers sat down with corporate sponsors and investment partners.

“Numerous feasibility studies were run by three separate companies on the Phoenix market and every time the capacity analysis exceeded our planning and design intentions for the original park,” Mladick says. “That’s what drove some of the growth.”

Phoenix has always had a radically under-served recreational market, developers say, which further supports Waveyard’s ambitious scope. Rawhide, the faux Western town that recently relocated from its longtime perch in north Scottsdale, was the state’s No. 2 tourist attraction behind the Grand Canyon for years, and Arizona is the only major metropolitan market without a theme park. This has always been attributed to the engineering challenges associated with the extreme temperature swings. Mladick says Waveyard is the logical approach to conquering these challenges in Arizona.

By catering to the nearly 39 million enthusiasts who participated in outdoor sports last year, according to the Outdoor Industry Association, Waveyard’s first-year attendance is projected to exceed 1 million, keeping dollars in Arizona that would otherwise be spent in coastal cities and drawing new revenue into the state during the scorching summer months.


Harquahala Switchyard
Power Line Proposal Would Link States

Harquahala Switchyard, Ariz.— A California power company wants to build a 230-mile high-voltage transmission line from Harquahala Switchyard outside of Phoenix to a substation near Palm Springs, Calif. Officials at the Southern Edison Co. say the project, called Devers-Palo Verde No. 2 because it runs parallel to an existing line, will lower the cost of electricity for California customers and increase tax revenues and employment figures in Arizona. During a two-year construction period, 150 people will work on the project and Arizona’s economy will receive $85 million. Before construction starts, however, multiple state and federal agencies must grant approval, including permission from the Arizona Corporation Commission, the Bureau of Land Management and the California Public Utilities Commission.


Expansion to Feed Need for Lawyers

Phoenix, Ariz.—For a state of its size, Arizona produces fewer attorneys than many of its peers; but now the capital city and fifth largest metropolitan area in America will finally see its first private, urban law school. The Phoenix School of Law will relocate from Scottsdale this fall to a campus on the southeast corner of Indian School Road and Central Avenue, adjacent to Steele Indian School Park. The move will bring an anticipated 150 students, faculty and staff to the new location–a number that will increase to about 500 within the next three years. The school’s spokeswoman Jodi Weisberg says Arizona falls below the national average of lawyers per capita. The state has approximately two attorneys per 1,000 citizens compared to the U.S. standard of 3.7 per 1,000. This is the first law school in Arizona that offers part-time and evening classes.


Lichfield Park
Mayor Keeps Commuter Rail Dream Alive

Lichfield Park, Ariz.— It may not be as glamorous as the light rail project snaking through Metro Phoenix, but Lichfield Park Mayor Woody Thomas believes commuter rail could service the region within the decade. The Maricopa Association of Governments put $300,000 into next year’s budget to study the feasibility of commuter rail and the Arizona Department of Transportation allocated $400,000 to update their reports, says Thomas. Thomas says light rail issues often clash with commuter rail proposals based on the “scepter of money” and fears that a regional transportation system would compete for light rail customers. But advocates say the two are complementary. Questions remain, however: How much would commuter rail cost? Is freight rail—running at capacity—able to share track? One proposed route would run from downtown Phoenix to near the Palo Verde power plant in the West Valley with only a handful of stops. Thomas says the East Valley would have similar opportunities.

AZ Business MagazinePhoenix
Metro Job Growth Tips National Scales

Phoenix, Ariz.— With population surging in all corners of the state, Greater Phoenix has edged ahead of every metropolitan area in the nation in at least one growth category. According to the U.S. Bureau of Labor Statistics, 308 metropolitan areas reported over-the-year increases in non-farm payroll employment from April 2005 to April 2006. Of those cities, the Phoenix-Mesa-Scottsdale area topped the list with 97,800 new jobs. Next was the Dallas area, which trailed the Valley by nearly 17,000 jobs. Not surprisingly, Valley unemployment also improved. At 3.6 percent in April 2006, it fell 0.4 percent from the previous year. The Arizona Department of Commerce announced it would receive recognition from Area Development magazine for its involvement in the state’s employment growth. The magazine acknowledged Intel, Countrywide and Verizon projects that brought approximately 3,600 jobs to Chandler in 2005.



Arizona Business Magazine Aug/Sept 2006