Tag Archives: Dennis Hoffman

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Phoenix Joins Initiative to Promote Global Trade

The Greater Phoenix Economic Council announced the region has been selected as one of eight metro areas in the country to join a new exchange network created by the Global Cities Initiative, a joint project of Brookings and JPMorgan Chase. The Exchange is a network of metropolitan areas committed to promoting greater global trade and economic competitiveness. As part of the inaugural Exchange, Greater Phoenix will be required to design and implement a regional export plan in 2014.

In Greater Phoenix, the Global Cities Initiative will be led City of Phoenix Mayor Greg Stanton and a core leadership team including the following representatives:

> Joe Stewart, market manager – AZ & NV Middle Market, Chase
> Dennis Hoffman, professor and director, L. William Seidman Research Institute at the
W. P. Carey School of Business at Arizona State University
> Barry Broome, president and CEO Greater Phoenix Economic Council

“A strong trade and export strategy is critical to our region’s economic vitality, so I’m honored to lead this initiative for Greater Phoenix,” Mayor Stanton said. “I look forward to working with my fellow mayors and business and community leaders to build a regional export plan that capitalizes on our unique assets and advances a stronger and healthier economic platform by expanding our global trade and investment strategies.”

Other participating groups include the Arizona Export District Council, Canada-Arizona Business Council, Intel and the Arizona Commerce Authority.

Brookings selected metropolitan areas to join the network after an extensive application process that evaluated regions’ readiness and capability to pursue the Exchange’s curriculum and commitment to fulfill its goals. Greater Phoenix joins Atlanta; Greenville, S.C.; Indianapolis; Jacksonville, Fla.; Milwaukee; Phoenix; Sacramento, Calif.; and Wichita, Kan., in the Exchange’s inaugural class, which will work together over the next four years to establish new metro-to-metro relationships and to share best practices in global economic development.

“For the Exchange, we selected metro areas that are committed to expanding their global economic reach by working together to identify regional competitive strengths and increase exports,” said Brad McDearman, Brookings fellow. “The eight metro areas selected for this round represent a growing group of U.S. metro areas that understand the need to embrace the global market to remain competitive in the 21st century economy.”

Over time, the network will expand to include additional U.S. and international cities working together to strengthen their local economies through increased engagement with the rest of the world. This builds on the Global Cities Initiative’s work, which equips metropolitan leaders with the information, policy ideas, and global connections they need to bolster their regions’ positions in the global economy.

“I’m delighted Greater Phoenix will be a part of this new network – it’s exactly the kind of innovative planning that is needed to ensure our community’s long-term economic success,” said Joe Stewart, market manager – AZ & NV Middle Market, Chase. “We have a long history of helping businesses connect to global markets and now the Exchange brings additional resources to help our region’s leaders design strategies to further create jobs and grow our economy through greater global engagement.”

The Global Cities Initiative supports the region’s existing efforts to implement the Brookings Metropolitan Business Plan (MBP), where business, university, political and civic leaders have adopted several core strategies to leverage  the region’s assets in a way that secures economic strength for Greater Phoenix through the 21st century. The Global Cities Initiative will serve to fulfill the MBP’s global export and foreign direct investment strategy. Further details about the MBP will be announced in early 2014.

“It’s fantastic that Greater Phoenix is participating in this initiative – a reflection of our unified commitment to attract and retain export-based businesses that are ultimately responsible for regional economic growth and prosperity,” said Dennis Hoffman, professor and director, L. William Seidman Research Institute at the W. P. Carey School of Business at ASU. “A strong research university is an important attractor for businesses seeking talent and knowledge capital that can help them succeed in global markets, and I am pleased to represent ASU in this initiative.”

Metro area leaders play a critical role in promoting trade and developing infrastructure. Regional economic development leaders representing both the public and private sectors can help local firms access new markets and align existing export services because they know their regions best. These leaders are also best equipped to coordinate regional assets—such as skills training, innovation capacities, and freight and logistics—to better support global trade.

“In Greater Phoenix, we are already making exports and foreign direct investment a central and consistent part of our broader regional economic development strategy. Adding this partnership with the Global Cities Initiative will only strengthen our results,” said Barry Broome, president and CEO of the Greater Phoenix Economic Council. “I look forward to the collaboration involved – not only within our own regional leadership but also with the other participating metro areas – to advance and diversify our region’s economy and solidify our future prosperity.”

In December, the Greater Phoenix Exchange team will join those of the other accepted metropolitan areas at Brookings in Washington to participate in their first working group session, where they will learn how to develop an export plan as part of a global economic development strategy. Throughout the four-year Exchange, participating metros will periodically convene for in-person working groups and will continually engage in curriculum via conference calls and webinars.

Coinciding with the work of the Exchange, Greater Phoenix will host a forum in 2014, bringing together regional and national experts on trade. Greater Phoenix is the only metro participating in the Global Cities Initiative to host such a forum. Its proximity to Mexico and trade relationships position the region as the ideal host of a conversation on global trade and exports.

WPCarey-School-Sign

W. P. Carey School Dedicates New McCord Hall

One of the nation’s largest and highest-ranked business schools dedicated a brand new, state-of-the-art facility today. The W. P. Carey School of Business at Arizona State University held a ceremony to mark the official opening of its 129,000-square-foot McCord Hall.

“We believe we’ve built the most advanced learning environment available for graduate business students,” says W. P. Carey School of Business Dean Amy Hillman. “Every detail was designed to teach students in a way that makes them better contributors to today’s work environment. The building has an emphasis on collaboration, discussion-based learning and flexibility.”

The new building is being added to the school’s two existing structures, which were renovated during this project. Together, they will ease overcrowding for the 10,000-plus students who attend the W. P. Carey School. McCord Hall will be home to the school’s graduate and executive-education programs, including the Top 30 nationally ranked MBA programs.

The impressive facility features modern architecture, technologically advanced tiered and flat classrooms, a multipurpose event space, a new graduate-level career center, team rooms, study areas, outdoor assembly areas, a lounge for honors undergrads, and a health-conscious café. McCord Hall is also environmentally friendly, with less water and energy use than similar buildings and a solar array that returns power to the campus grid. The project totaled $57 million, and the return on investment is expected to be great.

“We estimate the project has already had an economic impact on the gross state product of $64 million and the creation of 880 jobs,” says Professor Dennis Hoffman, director of the L. William Seidman Research Institute at the W. P. Carey School of Business. “Of course, the value of the construction does not include the added value that will accrue from the human capital produced in McCord Hall’s learning environment, allowing students to acquire knowledge and skills to compete in today’s economy.”

ASU President Michael Crow and Hillman presided over the dedication ceremony at the university’s Tempe campus. Philanthropist Sharon Dupont McCord and other building donors also took part. McCord and her late husband, Bob, are the major donors behind the facility’s name. More than $17 million in gifts and pledges from area companies and families, as well as other various sources, are helping to fund the building. Student support has been robust.

To learn more about the W. P. Carey School of Business, visit wpcarey.asu.edu. For more information about McCord Hall, go to http://building.wpcarey.asu.edu/. Donations to the building campaign can still be made at asufoundation.org/wpcbuilding. The W. P. Carey School’s full-time MBA, evening MBA, online MBA and undergraduate business programs are all currently ranked Top 30 in the nation by U.S. News & World Report.

Royal Palms exterior

Royal Palms Debuts Brand New T. Cook's

On September 9th, Royal Palms Resort and Spa re-opened the highly acclaimed T. Cook’s restaurant. Highlighting Executive Chef Paul McCabe’s creative interpretation of New American cooking, the Mediterranean-inspired design and architecture; the restaurant is introducing a new culinary and overall guest experience while remaining loyal to the treasured, timeless atmosphere guests have come to know and love.

The refreshed T. Cook’s design, led by Haley Balzano, founder and architect of Phoenix-based creative design team Bar Napkin Productions, emphasizes a more vibrant color scheme, authentic design elements, an interactive kitchen, the remodeled private dining room “Delos” and a glass-enclosed wine and tequila tasting room. New boldly-colored chairs surround rustic wooden tables adding depth and diversity to the new dining room, while iron chandeliers create a sense of intimacy and stimulate an experience of romance. Al fresco dining can also be discovered at T. Cook’s with intimate patios and nooks, including a new private dining element found within the property’s historic Orange Grove.

Simple yet polished, the new dining menus, created by Executive Chef Paul McCabe, honor classical techniques while utilizing locally-grown and sustainably raised foods whenever possible. Chef McCabe has established relationships with a wide range of local purveyors, farmers and artisans, including McClendon’s Select, Singh Farms, Noble Bread and Hayden Flour Mills.

“The menu is designed to be more social and approachable, while incorporating cooking techniques that reflect the evolving culinary scene in Phoenix and beyond,” says McCabe. “Our dishes are inspired by seasonal, locally-sourced ingredients, with some of the freshest growing right in our backyard. T. Cook’s new edible gardens have been an ongoing project this summer that will have come to fruition in September. We’ll be handpicking everything from vegetables and citrus, to herbs and select seasonings.

Referencing the seasonal spirit of the Mediterranean, Chef McCabe also meticulously sources the richest of ingredients for fresh fish from the bountiful Basque Coast and Spanish ports, to sardines from the heart of Sicily. T. Cook’s culinary philosophy of magnifying the purity of fresh, seasonal ingredients is a celebration of its own treasured legacy. This respected tradition lives on at T. Cook’s with Chef McCabe at the helm.

Offering breakfast, lunch and dinner and brunch on Saturdays and Sundays, T. Cook’s new menus aim to be both approachable and intriguing. Breakfast and brunch offer a range of healthful dishes to more indulgent items.

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W.J. Maloney Plumbing, Heating & Cooling Wraps Up Work On Muhammad Ali Parkinson Center

 

W.J. Maloney Plumbing, Heating & Cooling has added to its healthcare and medical center expertise with the conclusion of its work on the plumbing system at the Muhammad Ali Parkinson Center and Movement Disorders Clinic at St. Joseph’s Barrow Neurological Institute in Phoenix.

W.J. Maloney Plumbing, Heating & Cooling was the responsive low bidder of the plumbing system on the remodeling project, including testing and certification.

Kitchell served as the general contractor on the project.

The Barrow Neurological Institute is part of St. Joseph’s Hospital and Medical Center, the largest hospital in the Dignity Health system. Barrow has been one of the preeminent centers for specialty neurological care in the United States for more than four decades.

The healthcare industry continues to be a strong construction segment for W.J. Maloney Plumbing, Heating & Cooling, as the company has recently been contracted for design/build services at the Veteran’s Administration’s Southeast Healthcare Clinic in Gilbert, St. Joseph’s Westgate Medical Center in Glendale and La Loma Village assisted living complex in Litchfield Park and a completed project at the Orthopedic and Spine Inpatient Surgical (OASIS) Hospital in Phoenix.

“We have been selected by a number of general contractors to work on some of the most prominent hospital and healthcare centers in Arizona,” said Kathryn “Kitty” Maloney-Langmade, president of W.J. Maloney Plumbing, Heating & Cooling.

“Our team is proud to be able to continually deliver outstanding construction services on these projects that have such a positive impact on each of their respective communities.”

 

Arizona Is Losing Economic Grounds To Other Southwestern States, 2008

Rebound for Arizona and U.S. Slows Down

Jobs, home prices and population growth are all slowly rebounding in Arizona. However, experts from the W. P. Carey School of Business at Arizona State University say we still have a long way to go, and the automatic federal budget cuts known as the sequester aren’t helping our momentum. The experts delivered their forecasts today at the annual Economic Outlook Luncheon sponsored by the Economic Club of Phoenix.

Research Professor Lee McPheters, director of the JPMorgan Chase Economic Outlook Center at the W. P. Carey School, confirmed Arizona is once again a Top 15 growth state for both employment and population, but we’re not back to normal levels. From 1960 to 2007, we routinely ranked among the Top 5 states for both employment and population growth. In the rough years from 2008 to 2011, we dropped down to No. 48 and No. 14 in those areas.

“Last year, we finally bounced back to No. 8 for employment growth and No. 7 for population growth,” said McPheters. “However, the sequester and other factors have been clouding the economy here in recent months, and the year-over-year job-growth ranking issued this March dropped Arizona down to No. 13. The state will have to wait a couple more years for full recovery.”

Arizona added 48,900 jobs in 2012. The state is projected to add 61,000 jobs this year. The fastest-growing industries are construction, wholesale trade, information, state government and leisure/hospitality.

“Arizona has gained back 39 percent of the 314,000 jobs we lost in the recession,” explained McPheters. “However, that’s a pace well behind the nation as a whole, which has regained 67 percent of its 8.8 million lost jobs.”

In recent years, population growth in Arizona had dropped from the state’s typical 2- to 3-percent range to less than 1 percent. Finally last year we popped back up to 1.3 percent.

Personal income may also be coming back. The consensus of Arizona Blue Chip economists shows growth in this area of 3.7 percent in 2012, 5.1 percent expected in 2013, and 6 percent expected in 2014.

“The bottom line is that Arizona is doing better than most states, but this will still be the seventh year in a row of lean, subpar growth for us,” said McPheters.

Dennis Hoffman, economics professor and director of the L. William Seidman Research Institute at the W. P. Carey School of Business, reiterated that Arizona is recovering more slowly from this recession than from others in the past. However, we are coming back stronger than the nation as a whole in most areas of the economy. Hoffman expects the United States to see 2- to 3-percent gross-domestic-product (GDP) growth this year. That will likely include more moderate job growth and low inflation.

“The economy is plodding along, assisted by the real-estate and stock-market recoveries, low fuel prices and innovation in the business world,” said Hoffman. “Still, we face a lot of uncertainty from our national-debt crisis, political squabbling in Washington, economic difficulties in Europe and China, and changing demographics. One huge issue remains the problem of future funding for Social Security and Medicare.”

At the state level, Hoffman says we’re going to be strongly affected by the decisions still to be made this year on possible Medicaid expansion, the loss of the temporary sales tax, the potential taxing of online sales, and other big issues. For now, state revenue has been coming back with the rebounding economy.

When it comes to the housing market, Mike Orr, director of the Center for Real Estate Theory and Practice at the W. P. Carey School of Business, delivered good news about the recovery. Specifically, the median Phoenix-area home price was up a whopping 58 percent from a low of $111,000 in May 2011 to $175,000 this March. Foreclosures were down 60 percent just over the last year from March 2012 to March 2013, and Orr expects foreclosure rates to dip below long-term averages by the end of next year. Also, less than 5 percent of Arizona home loans (not already in foreclosure) are delinquent now.

However, we do face some problems in the housing market. For one thing, there’s a chronic shortage of homes for sale. Now that there’s no flood of cheap foreclosures and short sales coming onto the market, buyers are dependent mostly on normal resales and new-home sales.

“Higher prices would normally bring more ordinary home sellers into the market, but many are either locked into their homes because of negative equity, or they’re simply waiting for prices to go up more,” explained Orr. “As a result, some buyers are turning to new-home sales, but developers are reluctant to overbuild as much as they did at the market peak. Therefore, we may see about 50,000 to 60,000 new people being added to our local population this year, but only around 12,000 new single-family homes being built.”

Today’s Economic Outlook Luncheon was held at the JW Marriott Desert Ridge Resort & Spa in Phoenix. The Economic Club of Phoenix hosts this event every spring, as one of its opportunities for Valley business leaders and others to network and engage. The club was founded by a group of prominent business executives called the Dean’s Council of 100, in conjunction with the W. P. Carey School of Business. More information about the club can be found at www.wpcarey.asu.edu/ecp.

Today’s presentations will be posted at knowWPCarey, the business school’s online resource, at http://knowwpcarey.com.

Arizona Economic Forecast 2011

Arizona’s Economic Recovery Remains Sluggish, But The Outlook Is Brighter

While the nation’s economy showed some significant signs of life in the first half of 2011, the state’s economy continues to bounce along the bottom. But forecasters at the Economic Club of Phoenix’s Annual Economic Outlook 2011 luncheon on May 5, said they are looking at a comparably stronger finish to the year, with growth continuing at a healthier pace leading up to 2015.

“Arizona job growth is still very weak. For the first quarter, the Arizona economy has added only 4,100 jobs over the first quarter of last year, so growth is well below one half of one percent,” said Lee McPheters, director of the JPMorgan Chase Economic Outlook Center at the W. P. Carey School of Business in an interview before the luncheon. “The summer is not usually a strong period for job growth in Arizona, in fact the economy basically goes nearly flat. We are currently forecasting 1 percent job growth, or an increase of about 24,000 new jobs for the year.”

McPheters said that if Arizona has any hope of generating 1 percent job growth, the state and nation’s economies needed to get moving in the second half of the year.

“Current national forecasts are calling for improved job growth this year, but it will also tend to be weighted to the second half,” he said. “So, economy watchers have their fingers crossed that things will improve after summer.”

According McPheters’ forecast, in 2011 the nation will record 650,00 housing starts, an inflation rate of 2.6 percent, 2 million jobs created and GDP growth of 3.1 percent.

Here in Arizona, where the state once led national economic recoveries, it is now relying on growth in other parts of the country to rev up its financial engine.

“Arizona population growth depends as much on events outside Arizona as within the state,” McPheters said. “If Arizona job growth improves (and it has a long way to go), this would act as a ‘draw.’ But people have trouble moving if they cannot sell their house or if they cannot get the price they need. That is why we expect to see more young people move to the state, they will rent instead of buy and are less locked into a particular career path.”

This year, McPheters forecasts that Arizona job growth will only be 1 percent, with personal income rising 4 percent. Meanwhile, single-family home permits are expected to rise by just 10 percent and the population will increase by 1.5 percent. The forecast is only slightly better in 2012, with employment expected to be up 2 percent, a 30 percent increase in single-family home permits and a 1.8 percent rise in the number of people moving into the state.

Arizona Economic Forecast 2011

However, McPheters said, the state’s economy will continue an upward trajectory through 2015, with personal income rising 6.5 percent, the rate of job growth hitting 3.5 percent and a population increase of 2.5 percent. Single-family housing permits are expected to increase by 50 percent in 2013 (reflecting the current stasis in the residential home industry) before leveling off to a 20 percent growth rate in 2015.

Arizona Economic Forecast, Far Forecast, Arizona Recovers

In raw numbers, McPheters forecasts that between 2011 and 2015 the state will create 300,00 jobs, issue 112,500 single-family home permits, and see 665,000 new residents.

Arizona Forecast, Annual numberic change in employment

The state’s ongoing budget crisis has been one of the major factors in Arizona’s slow economic recovery.

“The effect of budget cut backs has been felt sharply by local governments,” McPheters said. “Their employment is down by 5,000 workers and is expected to decline more in the months ahead. Typically, we look to state and local government as a source of stability, not necessarily a growth sector. But current budget problems have changed all that.”

Not too long ago, Arizona enjoyed a substantial budget surplus. So, where did all the money go? Dennis Hoffman, director of the L. William Seidman Research Institute, succinctly illustrated the devastating effect the economic crash had on Arizona residents and, in turn, the state’s revenue.

  • The number of millionaires in Arizona dropped from 6,000 in 2006 to about 2,500 in 2009.
  • Taxes paid by millionaires dropped from more than $800 million in 2006 to under $300 million in 2009.
  • In 2006, the state’s 70,000 tax filers with incomes of $200,000 and above paid half of all taxes or $1.6 billion. In 2009, that same group of taxpayers shrank to under 50,000, paying about $550 million — less than 25 percent of the total taxes paid.
  • In addition, the state reduced tax rates by 10 percent after 2006.

 

When adjusted for inflation, the average amount of income tax collected from an Arizona resident dropped from about $1,650 in 2005 to about $1,050 in 2009. But even as fewer dollars come in, the state’s expenditures have remained relatively constant.

“Right now, the state’s expenditures represent about $425 per $10,000 of personal income in Arizona,” Hoff man said at the luncheon. “However, the state is only collecting about $300 per $10,000 of personal income. Obviously, that’s not sustainable.”

Hoffman did sound one bright note.

“The last couple of months have seen considerably robust retail sales, especially in the area of durable goods,” he said, adding that improved consumer confidence is fueling the recent growth.

That will certainly help the state government as it grapples with its budget crisis, but Hoffman also pointed out that the temporary sales tax increase will expire just as the economy is expanding and putting more pressure on public sector services. He added that state policymakers will face a “balancing act” during much of the next five years — especially in 2014. Part of the solution, Hoffman said, will involve streamlining the state’s expenses and raising taxes.

“Government just simply has to be more efficient in it’s expenditures,” he said. “(And) we have to ask everyone to contribute according to their means.”

To read more, visit knowledge.wpcarey.asu.edu.