AZRE January/February 2022

JANUARY-FEBRUARY 2022

50 COMPANIES

TO WATCH

The Central Park Developer: Pivotal Group

INSIDE: Emerging Leaders p. 34 | Build Your Future p. 57

CONNECT DESIGN BUILD We are proud to have received three 2020 Excellence in Masonry Architectural Awards from the Arizona Masonry Council for the Adelante Healthcare West Valley project.

• Top award: Gold Trowel Award • Craftsmanship Award • Merit Award for non-residential

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Architect: Cawley Architects | Designer: Douglas Cardinal Architect

Full Steam Ahead

A

s we close the page on 2021, hopes that we would be doing the same on the COVID pandemic have stalled.

The Omicron variant has been shuttering businesses, canceling flights and clouding the nearterm outlook. But ever since the emergence of COVID-19 in early 2020, one thing that the virus couldn’t stop was Arizona’s commercial growth. Brokers, developers and builders reported record numbers in 2021, exceeding 2020’s exceptional performance, which was one of the best years on record for the region. Net absorption, rental rates and sales volume are at historic highs, and vacancies have shrunk to an all-time low.

Leading the way are the industrial and multifamily markets.

“Industrial leasing in capital markets and multifamily capital markets have carried every large brokerage firm’s production in 2021,” says Mike Garlick, executive managing director for Newmark Knight Frank.

More than 24 million square feet of industrial construction is underway across Greater Phoenix, with approximately 30 million square feet completed in 2021.

And more than 32,000 new multifamily units are under construction or were completed during the year.

While the brokers, developers and builders remain bullish on the Phoenix market heading into 2022, one of the top concerns is supply chain delays. Manufacturers are still not at full capacity, and product delays could continue well into 2023.

“Material shortages are probably the biggest constraint in the market right now,” says Anthony Johnson, industrial business unit president for Clayco. “There would be more under construction and being delivered if people could get the materials they need.”

So what does this all mean for the future? We talked to experts in the various market sectors to get their insight into what we can expect in 2022. Find out what they have to say in our exclusive industry outlook, available online at azbigmedia.com.

President and CEO: Michael Atkinson Publisher: Amy Lindsey Vice president of operations: Audrey Webb EDITORIAL Editor in chief: Michael Gossie Senior editor: Rebecca L. Rhoades Staff Writer: Kyle Backer Interns: Jacob Flores, Elinor Tutora Contributing writers: Carrie Kelley | Suzanne Kinney Courtney Gilstrap LeVinus ART Art director: Mike Mertes Design director: Bruce Andersen Marketing designer: Heather Barnhill MARKETING/EVENTS Marketing and events specialist: Lynette Carrington Digital marketing specialist: Chrissy Souders OFFICE Special projects manager: Sara Fregapane Database solutions manager: Amanda Bruno AZRE | ARIZONA COMMERCIAL REAL ESTATE Director of sales: Ann McSherry AZ BUSINESS MAGAZINE Senior account executives: David Harken | April Rice | Maria Hansen AZ BUSINESS ANGELS AZ BUSINESS LEADERS Director of sales: Sheri Brown EXPERIENCE ARIZONA | PLAY BALL Director of sales: David Ealy RANKING ARIZONA Director of sales: Sheri King

Rebecca L. Rhoades Senior editor, AZRE rebecca.rhoades@azbigmedia.com 2 | January-February 2022

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CONTENTS

FEATURES 2 Editor’s Letter 6 Trendsetters 8 Executive Profile 10 After Hours 12 New to Market 14 Big Deals

18 Legislative Update

40

22 Concord General

26 BOMA 30 East Valley Focus

34 Emerging Leaders

12

40 50 Companies to Watch

57 Build Your Future

73 ULI

42

On the cover:

The Central Park Developer: Pivotal Group 4 | January-February 2022

GO TO store.azBIGmedia.com to purchase subscriptions, digital issues and plaques

26

CELEBRATE AN INCREDIBLE YEAR IN ARIZONA COMMERCIAL REAL ESTATE 2022 RED AWARDS The Real Estate and Development (RED) Awards — which are considered the Academy Awards of Arizona’s commercial real estate industry — honor the year’s top brokers, architects, contractors, developers and projects.

Thursday, March 10, 2022 5:30-8:30 p.m.

Embassy Suites by Hilton Scottsdale Resort

2022

Chaparral Conference Center 5001 N. Scottsdale Road Scottsdale, AZ 85250 FOR EVENT SPONSORSHIP INFORMATION CONTACT: Ann McSherry, ann.mcsherry@azbigmedia.com or call 602-291-9661 TICKETS ON SALE SOON: AzBigMedia.com/awards-events

TRENDSETTERS

34 Years of

Giving Back

O

ne of the cornerstones of Valley Partnership’s mission is community outreach, and at its end-of-the-year Friday Morning Breakfast on Dec. 17, the organization presented The Salvation Army Tempe with a check for $60,000. This generous donation was part of its annual community project.

For the past 34 years, Valley Partnership has been giving back to the community through monetary donations and labor. Each year, it selects a nonprofit organization that can benefit from the skills, efforts and supplies provided by its partners to renovate and enhance facilities for children and those in need.

In pre-pandemic years, the community project was an annual hands-on event that brought together upwards of 300 leaders and members from the real estate and development

6 | January-February 2022

communities for a day of service.

Past projects include painting murals and building patio furniture for New Pathways for Youth in Downtown Phoenix; creating parks, gardens and playing fields for the kids at Sunshine Acres Children’s Home in Mesa; and transforming a vacant parking lot into an urban farm for The Society of St. Vincent de Paul in Phoenix.

“We always ask ourselves, ‘Where can we make the biggest impact,’” says Carrie Martin, vice president of events and marketing for Valley Partnership. “With organizations such as St. Vincent de Paul or The Salvation Army, you’re helping hundreds of thousands of people.”

In addition to raising funds for The Salvation Army, this year’s project included an on-site component.

On Dec. 4, slightly more than 100 members volunteered at The Salvation

Army’s Tempe location, performing landscape maintenance, painting and packing food and hygiene supplies.

“Our focus was fundraising, but The Salvation Army building has been around for about 100 years. It’s just tired, and it needed some work,” Martin notes. The location serves more than 600 families and clients, offering life-saving services and support.

The money raised by the Valley Partnership Community Project will help with needed repairs, reorganization of the facility and additional food and hygiene bags among other things.

“With so much going on the past year or two, people just want to do something good,” Martin says. “Our community project is a way for them to not feel so helpless. It’s a true feel-good kind of moment.”

CHANGES AT THE TOP

With a new year comes new leadership as CRE professional organizations elect officers for 2022.

TAKING OWNERSHIP CHASSE Building Team is now 100% employee-owned. The firm recently launched an Employee Stock Ownership Plan (ESOP) — or, in this case, a TSOP. “We decided to call it our Teammate Stock Ownership Plan,” says founder and president Barry Chasse.

“We want our employees to act and think like owners.”

Chasse founded the eponymous company in 2007, and over the past 14 years, the company has grown to more than 200 team members and oversees more than $425 million in client engagements each year.

A surprise announcement of the TSOP was made to employees at a companywide meeting at Sloan Park in Mesa on Dec. 2.

Melissa Scott Building Owners and Management Association (BOMA) of Greater Phoenix President: Melissa Scott, Sunbelt Holdings Vice President: Kathryn Rhinehart, Davis Southwest Secretary/Treasurer: Lynn Nixon, Titan Restoration

Rusty Kennedy

NAIOP Arizona Board Chair: Rusty Kennedy, CBRE Vice Chair: Cathy Thuringer, Trammell Crow Company Treasurer: John Orsak, Lincoln Property Company Programs Chair: Phil Breidenbach, Colliers International Secretary: Derek Flottum, Irgens

Tyrel Williams Institute of Real Estate Management (IREM) President: Tyrel Williams, ORION Investment Real Estate President-Elect: Ed Valerio, Link Logistics Real Estate Treasurer: Brent Penrod, Eisenberg Company

Karla Moran Southwest chapter of the Real Estate Investment Advisory Council (REIAC) President: Karla Moran, SRP Vice President: Arthur J. Ferrari III, Lineage CRE Secretary: Keyvan Ghahreman, Willmeng Program Chair: Dick Lund, Biltmore Holdings Membership Chair: Chad Mantei, BBVA Commercial Treasurer: Phil McKenzie, KMPG Community Outreach Chair: Mark Singerman, Rockefeller Group

DATA CONCERNS According to the recent report, “Data Center Success … Leading to Sustainability Questions,” by Cushman & Wakefield, data centers are thriving, but water usage is a continued concern as the largest data centers can utilize millions of gallons of water for cooling. Desert areas, such as Phoenix, may be limited in their future data center deployments unless air cooling during the night or liquid cooling directly to the rack can be used instead. Excessive heat can limit server life, so continued optimization of cooling systems is an imperative moving forward.

7

EXECUTIVE PROFILE

Building Success Architect Mike Davis celebrates 30 years of great design

By ELINOR TUTORA and REBECCA L. RHOADES

M

ike Davis remembers seeing his first floor plan. He was 5 years old, and his parents showed the him the drawings for a house they were considering building. “I was mesmerized by it,” he recalls, “and I said to myself, ‘I will be an architect,’ and that pretty much stuck.”

Today, Davis is the founder and CEO of DAVIS, an architecture, interiors and urban design firm that is responsible for some of the most talked-about projects in the Valley in recent years.

And he has our turbulent economy to thank for it.

In 1991, Davis was working for a firm in Newport Beach, California, when the savings and loan industry collapsed, stunting commercial real estate development across the country.

“California really got rocked, and everything just shut down. So my boss at the time asked me to take over the

8 | January-February 2022

Phoenix office,” he says. “The beautiful thing was that I had spent the six years prior learning how to run a company.”

The firm began to hit its stride in 1994 when the market picked back up. Over the years, it has grown and shrank, acquiring competitors and increasing staff to as many as 150 in 2008. “We found that 40 is a good size for us. It’s pretty robust,” Davis says.

The team specializes in designing office spaces, hotels and some multifamily residential projects. More than 35% of the Class A office space in the Valley — 35 million of roughly 110 million square feet — was designed

by DAVIS. “Offices usually aren’t the statement projects that are front and center in the architecture magazines, but they’re important because they are the places people work in every day,” Davis explains.

One of the company’s most notable projects is Marina Heights, the single largest office development deal in Arizona history. Five buildings, ranging from six to 16 stories, span 20 acres on Tempe Town Lake. DAVIS had only 15 employees when it was approached by State Farm to design the structures.

“We were well into construction when one of their folks asked where our other office was. They were dumbstruck,” Davis recalls with a laugh.

A more recent project, the Class AA Grand2 at Papago Park Center, sold for more than $500 per square foot, making it the largest office sale in Arizona in 2020. Davis attributes the sale of the nine-story LEED Silver building not just to location but also to design. “We absolutely try to do the best looking buildings that we possibly can,” he points out. It’s an attribute that’s on display in the firm’s new headquarters.

After decades of renting, Davis decided it was time for a change.

His wife, Lisa, a commercial interior designer to whom Davis attributes much of the firm’s success, found their current location, which the company purchased, renovated and moved into in July 2020.

Located on the top floor of the iconic Mayer Central Building, the space was home to the Playboy Club in the 1960s and ’70s. “The views and the location are great,” Davis says. “And the midcentury architecture just feels like Phoenix.”

These days, Davis has stepped back from the nitty-gritty aspects of the business and focuses more on initial conceptual design and closing deals.

He looks to his oldest daughter, Taylor Sonoskey, to take the reins in the future. “I am really fascinated with having a daughter who’s way better at this than me. She’s a great architect,” Davis says. “She’s not as experienced as me yet, but I mentor her. I learn a lot from younger people; I think that’s a two-way street.”

Real Estate Industry Events Coming in 2022!

CITY OF TEMPE

2022 The Real Estate and Development (RED) Awards — honor the year’s top brokers, architects, contractors, developers and projects.

Thursday, March 10, 2022

FUELING THE ECONOMY The Fueling the Economy event will take an in-depth look at the health and current trends of commercial and residential real estate in Tempe. Industry insiders will provide expert insight into the robust developments that are happening in in 2022 and beyond.

Tuesday, May 17, 2022

MOST INFLUENTIAL

WOMEN

IN ARIZONA 2022

AZRE brings together some of Arizona’s most influential commercial real estate leaders to share their thoughts for a mid-year industry update.

Thursday, August 4, 2022

Az Business and AZRE magazines celebrate and honor the publications’ lists of the Most Influential Women in Arizona for 2022.

Thursday, August 25, 2022

For up-to-date event and sponsorship information,

Contact Ann McSherry at 602.291.9661 | ann.mcsherry@azbigmedia.com or visit azbigmedia.com/awards-events

AFTER HOURS

Words of Wisdom Land expert Greg Vogel reaps industry insight from Arizona’s history

By ELINOR TUTORA

B

ookshelves cover the walls of Greg Vogel’s private collection space, nicknamed the “book lounge.”

They brim with antique and modern manuscripts on topics such as water, land, biographies and the Southwest.

Vogel, CEO and founder of Land Advisors Organizatiom, specializes in providing brokerage and advising services for those acquiring, selling, financing or developing land. His passion for history has provided him

10 | January-February 2022

with a deep understanding of the core of his business. He is knowledgeable in land economics, use and trends and has become a trusted broker and advisor to his clients.

Shortly after moving to the Grand Canyon State from New Jersey to attend Arizona State University and earning a bachelor’s degree in real estate, Greg Vogel founded Land Advisors in 1987, known then as Arizona Land Advisors. He and his

team have since expanded into 26 markets and, in 2021, secured $4 billion in land trade, marking the firm’s best year of closure to date.

Before starting Land Advisors, Vogel interned at CBRE, where his passion for maps and the land history of the Southwest was launched. At age 19, he began putting land ownership into a database and knocking on doors, learning the histories of many families that have been in the region for generations. That database now includes millions of parcels, and Vogel is still in touch with many of the residents.

Vogel explains that he has always been an avid reader and in college his reading became embedded in the state’s history. Exploring the state via four-wheeler gave him an opportunity to get to know specific areas, leading to an interest in those places’ histories and the people who established them.

“I’ve got old biographies of all the pioneers and settlers who came out here and took a chance,” he says.

He began accumulating historic printed materials in the early 1990s, and his collection now includes thousands of books and maps. The need for a private space in which to store and display all the items came about when, after already owning about 1,000 volumes, he acquired 6,000 books all at once with no place for them.

It took him approximately a year and a half to unpack the nearly 200 boxes he moved into the space, and even now, with walls of shelving, his collection is so massive that there are books stacked behind the visible titles.

Over the years, the space has progressed from bean bags and card tables to the functional and stylish lounge it is today. In addition to the many books, maps, paintings, antiques and collectibles from the Southwest, it is outfitted with elegant furnishings and a small bar. Vogel recently opened the room to friends and acquaintances and began hosting events and meetings, such as book clubs.

“It has been great to share it with people, especially because all through the pandemic, it was a little bit of a hideout for me,” he says.

Vogel’s oldest map is an original 1620s map of the Americas. Another one, from the 1680s, features California as an island and excludes much of the land that makes up Canada. An 1886 mid-Civil War map shows Arizona split into a horizontal rectangle under New Mexico, and Arizona is spelled with two r’s.

Most of the collection was curated through antiquarian book dealers.

Vogel notes that there used to be five in Arizona; today, there are only two.

When visiting new cities, he always patronizes vintage book shops, and the digital age has brought about a whole new way to research and buy books.

The internet allows the bibliophile to make sure he is getting the best copy of any given text.

“Now it’s more hunting digitally than being on my knees looking through treasure troves at old bookstores,” Vogel says. “I like doing both, but I do love the smell of books and meeting people who are also passionate about collecting.”

Vogel reaches for a thick leatherbound book, slightly worn around the edges with the word “Biography” on it.

This prized tome, titled “Biography of Arizona,” includes stories of pioneers and a plethora of information about the makings of infrastructure that still exists today.

Not one to simply savor the works of other historians, Vogel currently is writing his own record of land in Arizona.

“History is rooted in the land,” he explains. “We have the concept of knowing where this all came from.

So I try to understand the lineage of families and what brought them here. I always hear these fabulous stories, and

I think that the deeper interest for the past 35 years in places such as Buckeye is odd because, for a long time, no one wanted to go out there to build homes or do commerce.”

After almost three decades of studying the Southwest’s unique and storied history, Vogel has gained an incomparable understanding of the region’s land history that sets him apart in the industry. His love of books, maps and related ephemera not only enhances his work but is a source of joy that he enjoys sharing with clients and those who are interested in what makes Arizona the booming state it is today.

11

NEW TO MARKET A

B

C

MULTIFAMILY A TOWN CHANDLER DEVELOPER: Related Group GENERAL CONTRACTOR: McShane Construction Company ARCHITECT: Todd & Associates SIZE: 420 units LOCATION: 18-acre site in Chandler COMPLETE: February 2024

12 | January-February 202

MULTIFAMILY B FLAGSTAFF MULTIFAMILY PROJECT DEVELOPER: Wexford Developments and Wexford Real Estate Investors ARCHITECT: Stewart + Reindersma Architecture SIZE: 224 units LOCATION: Northeast corner of 4th Street and Butler Avenue, Flagstaff START/COMPLETE: Q2 2022/early 2024

MULTIFAMILY C TEMPE MULTIFAMILY PROJECT DEVELOPER: Milhaus GENERAL CONTRACTOR: McShane Construction ARCHITECT: CCBG Architects LANDSCAPE DESIGN: Norris Design ENGINEER: 3 Engineering INTERIOR DESIGN: Design-Art SIZE: 219 units LOCATION: 2119 E. Apache Boulevard, Tempe COMPLETE: TBD

E

D

F

MIXED-USE D MESA ARTS DISTRICT LOFTS DEVELOPER: Opus Development Company ARCHITECT: Opus AE Group SIZE: 335-unit multifamily development, including close to 13,000 SF of retail space LOCATION: Main Street east of Sirrine, Mesa COMPLETE: October 2023

MULTIFAMILY E THE ALYSSA DEVELOPER: StreetLights Residential GENERAL CONTRACTOR: SLR Phoenix Construction ARCHITECT: StreetLights Creative Studio LANDSCAPE DESIGN: Norris Design SIZE: 335 units LOCATION: East Rio Salado Parkway just west of Arizona State Route 101, Tempe COMPLETE: TBD

HEALTHCARE F DESERT HARBOR MEDICAL COMMON DEVELOPER: Irgens CONSTRUCTION MANAGER: RSG Builders ARCHITECT: Upward Architects ENGINEERING CONSULTANT: IMEG Corp.

BROKER: Cushman & Wakefield SIZE: 43,873 SF LOCATION: 9000 W. Thunderbird Road, Peoria COMPLETE: September 2022

13

CITY OF THE FUTURE Proposed 37,000-acre community to bring 100,000 new homes to the West Valley

By KYLE BACKER

A

massive master-planned community (MPC) — one in which an estimated 300,000 residents will eventually call home — is underway in Buckeye. Known as Douglas Ranch, the nearly 37,000acre property is expected to become a leading MPC in the nation, with 100,000 homes and 55 million square feet of commercial development.

The Howard Hughes Corporation (HHC) purchased the property from acclaimed sports executive Jerry Colangelo and his team at JDM Partners, along with Eldorado Holdings. “Douglas Ranch is HHC’s largest MPC yet, spanning 37,000 acres in the West Valley. We could not be more thrilled to put our capital to work on this $600 million all-cash transaction. JDM and Eldorado will both remain as our 50/50 joint venture partners for the launch of Trillium, the first 3,000-acre village of Douglas Ranch,” explains David O’Reilly, CEO of HHC, on an investor call. Residential lot sales in Trillium are expected to begin in the first half of 2022.

In a press release announcing the launch of the community, Colangelo says, “To ensure the success of Douglas Ranch, we specifically sought out The Howard Hughes Corporation for its unique capability to build exceptional communities, implement proven best-in-class practices across new platforms at significant scale, and rapidly deliver on build-to-suit opportunities to help businesses relocate. As we prepare to start selling homes, we are excited that Douglas Ranch has been

14 | January-February 2022

Jerry Colangelo

Jay Cross

elevated to the ranks of the Howard Hughes communities that are among the most sought-after places to live, work and thrive in the nation.”

With this acquisition, HHC now holds the country’s largest portfolio of MPCs, totaling more than 100,000 acres. Other HHC communities include Summerlin in Las Vegas, and The Woodlands and Bridgeland in the Greater Houston area.

MEETING A NEED People seeking a low cost of living and respite from harsh winters have long looked to the Valley as a place to settle. Data from the U.S. Census Bureau shows that Maricopa County was the fastest growing county in the U.S. thanks in part to Greater Phoenix’s quality of life.

The City of Buckeye was among the 10 fastest-growing of all U.S. cities during the same period, growing 80% to nearly 92,000 residents, according to the U.S. Census Bureau. O’Reilly points to Arizona’s pro-business, low tax structure as a feature that will continue to draw future residents.

Over the last year, however, home prices in the Valley have soared as the trend of people moving to the Grand Canyon State continued. A Zillow market report shows that in October 2021, the metro area’s Zillow Home Value Index was $418,170, constituting a 32.7% year-over-year increase. During the same period, for-sale inventory dropped 17.4% year-over-year.

David O’Reilly Jay Cross, president of HHC, believes Douglas Ranch will help with the dearth of shelter.

“While the housing market over the last year saw a fast acceleration, there is no sign suggesting this will abate anytime soon, especially given the fact that demand in Phoenix is so much greater than supply,” he says. “If we look at this demand more closely, we can see that within Greater Phoenix, the majority of the market is migrating west directly along the path toward Douglas Ranch.”

Cross continues, “The West Valley has taken more than 50% of the market for single-family home permits. The demographics of those migrating to the West Valley are largely young families and professionals, and the amount of young people is only projected to grow faster over the next several years.”

With the expansion of a community the size of Douglas Ranch comes concerns about the desert’s most precious resource: water. O’Reilly contends that HHC has experience developing in arid conditions.

“We want to create a community that is built to last. We will be sharply focused on incorporating innovative solutions throughout Douglas Ranch in the form of cutting-edge technology,” he explains. “One of our major focuses will be around water conservation. Our team in Summerland has already implemented several water conservation measures due to the climate in the Las Vegas

Valley, and we will be able to replicate their best practices at Douglas Ranch to ensure we are being thoughtful about our water usage.”

HIGH POTENTIAL Greater Phoenix has become a darling for industry, with companies from Amazon to KORE Power, a lithiumion battery manufacturer, making significant investments in the region.

This inflow of capital further boosts the region’s appeal.

The possibility of Interstate 11 passing through Douglas Ranch is a boon for the community — along with its proximity to Interstate 10 — that will enable residents to travel throughout the region with ease. Cross remarks that HHC wants to ensure that the development of Interstate 11 is successful; the company even is willing to donate land to help the project come to fruition.

“We consider Douglas Ranch’s location as a strong catalyst

for residential and commercial opportunities. On the residential side, the close proximity to surrounding large cities will allow for the continued influx of residents from the West Coast and further afield,” he explains. “From the commercial lens, we see this as an opportunity to develop new asset types, such as industrial space. This MPC is ideally situated to become a transportation hub for several industries.”

Cross notes that Phoenix has gained significant traction in the industrial market. Indeed, Colliers in Arizona’s Q3 2021 industrial market report asserts that, “During the third quarter, the Phoenix industrial market was more active than at any time in its history, posting 7.2 million square feet of positive net absorption, outperforming last quarter, which was a previous milestone.

This marks the 10th consecutive quarter of more than 1,000,000 square feet of positive net absorption.”

The strength of the industrial market is intriguing to HHC, according to Cross.

“The Phoenix market currently has more than 24 million square feet of industrial space under construction, the most of any other city in the country. Over the last decade, rents have risen significantly while vacancy has consistently declined, which points to strong underlying demand in the sector.” Furthermore, the Valley has an established market for single-family build-to-rent communities.

Cross notes that these two sectors are asset classes that HHC is looking to add to its portfolio.

Ultimately, O’Reilly sees Douglas Ranch as a blank canvas on which to innovate. “We have the chance to develop this MPC from the ground up with a vision of distinguishing Douglas Ranch as a best-in-class community focused on sustainability and technology — a city for the future in a place residents and tenants can live, work, play and discover.”

Waterfront

Pedestrian Bridge

Trillium Rec Center Concept

Trillium Community Core Concept

15

MULTIFAMILY/SALES

$325M | 1,222 UNIT

VASEO APARTMENT HOMES 16220 N. 7th St., Phoenix BUYER: Invesco Real Estate SELLER: Klein Financial Corporation TITLE AGENT: Thomas Title & Escrow

$146M | 424 UNIT

$133.2M | 464 UNIT

GREEN LEAF PROMONTORY POINTE 888 E. Clinton St., Phoenix BUYER: Ivanhoe Cambridge SELLER: Greystar

TIDES AT MESA 45 S. Acacia and 2055 E. Broadway Road, Mesa BUYER: Tides Equities SELLER: IMT Residential / IMT Capital

$137M | 472 UNIT MIDTOWN ON MAIN STREET APARTMENTS

$126M | 376 UNIT

2121 W. Main St., Mesa BUYER: Kohlberg Kravis Roberts & Co. SELLER: Tides Equities

GARDEN GROVE APARTMENTS 900 W. Grove Parkway, Tempe BUYER: Intercontinental Real Estate Corporation SELLER: MG Properties

INDUSTRIAL/SALES

$135.89M | 728,390 SF

LOGIC PARK 9393 W. Buckeye Road and 1500 S. 91st Ave., Tolleson BUYER: The Pauls Corporation SELLER: Martens Development Company BROKER: Cushman & Wakefield

$126.75M | 718,200 SF

$71.6M | 600,256 SF

FAIRWAY 10 750, 850 and 950 N. 119th Ave., Avondale BUYER: CBRE Global Investors SELLER: Westcore Properties BROKER: Cushman & Wakefield

VT 303 - BUILDING 1 (AMAZON AZA9) 6395 N. Sarival Ave., Glendale BUYER: Preylock SELLER: VanTrust Real Estate BROKER: Goldman Sachs

$79.2M | 466,694 SF

$71.2M | 145,485 SF

9081 W. WASHINGTON ST. 9081 W. Washington St., Tolleson BUYER: Cohen Asset Management SELLER: Cohen Asset Management BROKER: Cushman & Wakefield

16 | January-February 2022

DTU6 AMAZON DELIVERY STATION 500 W. Pinnacle Peak Road, Phoenix BUYER: Stonemont Financial SELLER: Crow Holdings BROKER: Cushman & Wakefield

Here are the biggest deals in Arizona commerical real estate from Nov. 1, 2021 through Dec. 23, 2021, according to data collected by the commercial real estate tracking website Vizzda and AZRE magazine.

OFFICE/SALES

$106M | 277,161 SF

PARK PLACE 1650 and 1700 S. Price Road, Chandler BUYER: Manulife Investment Management SELLER: Douglas Allred Company

$37.75M | 109,811 SF

KIERLAND CORPORATE CENTER 1 7047 E. Greenway Parkway, Scottsdale BUYER: Yonezawa-Miller Company SELLER: Starwood Property Trust BROKER: Cushman & Wakefield

$33.4M | 68,000 SF

AKOS MEDICAL CAMPUS PHASE I & II 10825 W. McDowell Road, Avondale BUYER: Montecito Medical Real Estate SELLER: National Cardiovascular Management BROKER: Orion Investment Real Estate

$31.2M | 90,911 SF

CHANDLER AIRPORT CENTER I 1850 E. Northrop Boulevard, Chandler BUYER: Exeter Property Group / EQT Exeter SELLER: Exeter Property Group / EQT Exeter LENDER: New York Life Investment Management

$26.8M | 120,398 SF

CHANDLER CENTER COMMONS 5550-5590 W. Chandler Boulevard, Chandler BUYER: North Beacon Capital SELLER: Northstar Commercial Properties

LAND/SALES

$52.3M | 1,000.46 AC

COPPERWING LOGISTICS CENTER NWC El Mirage Road and Olive Avenue, El Mirage BUYER: Dermody Properties SELLER: John F. Long Family Trust

$45.2M | 143.31 AC

WATERSTON CENTRAL (PROPOSED) S. Val Vista Drive and E. Ocotillo Road, Gilbert BUYER: Hearthstone SELLER: Tri Pointe HomesS BROKER: Latigo Land & Capital

$45M | 11.99 AC

3929 W. LOWER BUCKEYE RD. 3929 W. Lower Buckeye Road, Phoenix BUYER: Exeter Property Group / EQT Exeter SELLER: Exeter Property Group / EQT Exeter

$??.?M | 112.34 AC

SOSSAMAN 202 (PROPOSED) SWC Sossaman and Warner roads, Mesa BUYER: Contour Real Estate SELLER: Gaylord Bob Yost BROKER: SVN | Desert Commercial Advisors TITLE AGENT: Thomas Title & Escrow

$36.5M | 70.15 AC

99TH AVENUE AND BUCKEYE ROAD SEC 99th Avenue and Buckeye Road, Tolleson BUYER: George Oliver SELLER: John E. Garretson BROKER: Cushman & Wakefield 17

LEGISLATIVE UPDATE

Arizona Economic Development Wins With Infrastructure Law I n November 2021, President Joe Biden signed H.R. 3684, the bipartisan Infrastructure Investment and Jobs Act. The compromise legislation, brokered in part by Arizona Senator Kyrsten Sinema, will provide a much-needed boost to the nation’s aging infrastructure. From ports, waterways and electricity to roads, transit and broadband, infrastructure improvements bolster the efficient movement of people and goods and act as a force multiplier for economic development activity.

So, what’s in it for Arizona?

Arizona Senator Mark Kelly released a list of state projects that will result from the passage of the infrastructure bill. These projects and the funding included in the bill will strengthen economic development with the following:

ROADS, BRIDGES AND MAJOR PROJECTS — $8.2 BILLION In addition to reauthorizing the Surface Transportation Reauthorization Act, the bill provides $8.2 billion for roads, bridges, and transit throughout Arizona. Arizona construction companies such as Skanska and Sundt will benefit greatly from projects funded by the bill through the Arizona Department of Transportation.

Workforce transit in rural and urban areas of Arizona will receive the following allocations: • $499.3 million for Valley Metro in the Phoenix Area • $118 million for SunTran in Tucson • $21 million for Yuma County Area Transit • $20.5 million for Mountain Line in the Flagstaff area • $11.1 million for Yavapai Regional Transit in the Prescott area • $7.5 million for Central Arizona Regional 18 | January-February 2022

Carrie Kelly AAED

Transit in the Casa Grande area • $7.2 million for Lake Havasu City Transit • $6.5 million for Vista Transit in Sierra Vista The Capital Investment and National Infrastructure Project Assistance programs will provide grant and discretionary funding for projects such as the I-10 expansion, I-11, light rail extensions and streetcars.

WATER INFRASTRUCTURE — $9 BILLION Water infrastructure is critical to Arizona’s future. Utility providers such as SRP and Central Arizona Project will benefit as the state will receive hundreds of millions for backlogged repairs to aging dams, canals, aqueducts and pumping plants.

The bill funds water settlements for our tribal partners, including the Gila River Indian Community, the Tohono O’odham Nation and the White Mountain Apache Tribe. While not Arizona-specific, $250 million will fund grants for desalination projects. Western states will receive $300 million to fund the Lower Basin Drought Contingency Plan, Lake Powell and the Upper Basin drought mitigation. Arizona will also receive $79.6 million annually to help public

wastewater systems finance significant infrastructure investments.

HIGH-SPEED INTERNET ACCESS — $58 BILLION Rural Arizona, in particular, needs better connectivity for economic development and health and safety.

Through grants to states, companies such as Cox and Lumen will help with rural broadband deployment and “middle mile” deficiencies throughout Arizona.

ENVIRONMENTAL — $5 BILLION Arizona companies such as Terracon and Ninyo & Moore will see a boost since the bill funds the Hazardous Substance Superfund program. The bill also includes $1.5 billion for the Brownfields program to help governments reuse contaminated properties.

RURAL FORESTS — $460 MILLION The bill includes a $400 million program at Forest Service to provide financial assistance to sawmills and wood products facilities that support forest restoration operations, including those in Arizona, and $60 million for grants under the USDA program to promote the use of wood biomass energy and the use of wood in construction materials.

These are only a few of the economic development funding opportunities for Arizona in the bipartisan infrastructure bill. Arizona is a leader in innovation and economic development, and this funding will allow our state to continue to lead the way and provide opportunities for citizens in every community.

Carrie Kelly is the executive director of the Arizona Association for Economic Development.

Housing is a statewide concern Local decision-making is resulting in an unaffordable Arizona

“O

ver the past three decades, local barriers to housing development have intensified, particularly in the high-growth metropolitan areas increasingly fueling the national economy. The accumulation of such barriers — including zoning, other land use regulations and lengthy development approval processes — has reduced the ability of many housing markets to respond to growing demand.”

These were not the words of a greedy developer or a special interest. Rather, these were the words of President Barack Obama prior to leaving office in 2016.

Interestingly enough, President Obama was not alone in his sentiments.

President Donald Trump, seemingly in agreement with his predecessor, established a White House Council on Eliminating Regulatory Barriers to Affordable Housing with the goal of providing recommendations to address the nation’s housing shortage.

In his executive order that established the council, President Trump noted that “[d]riving the rise in housing costs is a lack of housing supply to meet demand. Federal, state, local and tribal governments impose a multitude of regulatory barriers — laws, regulations and administrative practices — that hinder the development of housing.

These include overly restrictive zoning and growth management controls, rent

Courtney Gilstrap LeVinus AMA

controls, cumbersome building and rehabilitation codes, excessive energy and water efficiency mandates, unreasonable maximum-density allowances …”

In short, the country is facing a housing supply crisis due to years, if not decades, of poor growth management, and unless the state changes course, Arizona may soon be facing its own day of reckoning.

According to the Arizona Department of Housing, 250,000 homes must be built simply to keep pace with current and future demand. Last year, Maricopa County added 86,820 residents, making it the fastest-growing county in the nation, according to the U.S. Census.

The problem is, Arizona is not equipped (or motivated) to respond to this surging population growth.

In fact, according to the U.S. Department of Housing and Urban

Development, Census Bureau data indicates that from 2010 to 2016, only seven homes were built for every 10 households formed.

This isn’t because developers aren’t interested or available to answer the state’s need. It’s simply because the political appetite at the local level to allow the market to respond is waning.

For years, developers have complained, mostly to deaf ears, about the toxic realities of housing development in Arizona. Developers have pointed to neighborhood hostility and the not-in-my-backyard (NIMBY) mentality as the No. 1 threat to the state’s housing market.

Unfortunately, years of ceding to the NIMBYs has set Arizona up for a California-style housing crisis.

Rent pricing is no different than any other sector of the U.S. economy. If you limit the supply of a product or service, prices will increase. On the other hand, if you produce more of the product, prices will stabilize or even decrease.

This basic economic principal is true for housing prices as well. If we limit new housing development — as we are doing in Scottsdale, Mesa, Chandler, Goodyear, Surprise, Buckeye, Tucson and Flagstaff — then rental prices will increase.

We are also seeing a proliferation of new regulations, including new design guidelines, energy efficiency codes, parking standards and so on, that have added considerable costs to housing construction.

So, what’s the answer?

It’s fair to say that cities and towns are not equipped to respond to current housing needs. Perhaps it is time for the legislature to provide the tools necessary to dig Arizona out of this hole. Other states have taken drastic measures to increase the supply of housing, such as allowing housing to be built “by right,” removing onerous zoning restrictions or discretionary review processes, or providing statelevel review boards to overturn local land use decisions.

While it’s uncertain if these measures will become law in Arizona, policymakers are more willing to listen to ideas than ever before.

Courtney Gilstrap LeVinus is the executive director of the Arizona Multihousing Association.

19

LEGISLATIVE UPDATE

Ballot Initiative Reform: Restoring Integrity to the Process B

ack in 1912 when Arizona became the 48th state, populism was afoot. As a state founded on big industries such as mining and railroads, there was discontent among workers who demanded more rights in a political system they believed was stacked against them. Thus, the Citizens’ Initiative process was enshrined in our state constitution. It looked very different from its eastern state counterparts.

Jump forward 110 years, and we find ourselves in a vastly different situation.

Far from being a workable system for residents who feel their representatives in government are not listening to them, it has evolved into a boondoggle for well-financed special interests outside of Arizona to “try out” ideas they could not get onto the ballots of states with more restrictive initiative processes. We’ve seen billionaire hedge fund manager Tom Steyer, a Portlandbased activist group, and labor unions from California to New York pour tens of millions of dollars into Arizona ballot initiatives to persuade voters.

Because the U.S. Supreme Court ruled that political involvement is a form of free speech, we can’t prevent outside groups from bankrolling initiatives in Arizona. What we can do is put in place protections that have worked well in other states. These include raising the threshold required for passage, modifying geographic requirements for petition signatures to qualify for the ballot, or adding a sunset provision.

Who could be against concepts such as renewable energy, investments in education and affordable healthcare?

These sound benign enough until the details are revealed. Then a more

20 | January-February 2022

Suzanne Kinney NAIOP

disconcerting narrative emerges: higher energy costs with less service reliability, income tax rates among the 10 highest in the nation that hit small businesses already struggling to survive through the COVID pandemic, and the closure of rural hospitals that can’t afford mandated salary increases for all workers. These ballot measures are but a few recent examples of close calls.

They either failed to pass or were struck down by the courts for containing illegal or misleading language.

It is important to remember that Proposition 105 as passed in 1998 prevents the state legislature from addressing any unintended consequences that result from ballot initiatives. Even if uncompetitive taxes cause business attraction to grind to a halt, costly mandates result in hospitals closing down or energy portfolio requirements lead to rolling brownouts, the legislature’s hands are tied.

Over the past decade, several controversial initiatives, most recently Proposition 208 in 2020, have squeaked by in Arizona, passing with slightly more than 50% of the vote. Several states require a

super-majority of 55% to 60% for initiatives to pass. Nevada requires Constitutional amendments to pass in two consecutive elections. Raising the threshold above a simple majority could result in only those measures that enjoy broad support becoming law.

To get an initiative on the ballot, proponents must collect valid signatures from eligible voters representing 10% of the gubernatorial vote in the prior election for statutory changes and 15% percent for constitutional amendments. While these may seem like high thresholds, most well-funded out-of-state interests simply pay professional signature gatherers to get the job done. In doing so, they generally stand in highly trafficked areas in Metro Phoenix while ignoring the remainder of the state.

Adding a requirement that signatures be collected in all counties or from every Congressional or legislative district would improve fairness by including the voices of all Arizonans.

Finally, change is the only constant in the world today. Under current law, once an initiative has passed, it is here to stay. An automatic sunset provision of around 10 years would give voters the opportunity to re-evaluate the effects of an initiative. Measures that stand the test of time will continue to receive broad support, whereas those that have fallen short of expectations or that need to be modernized won’t hold back the state’s progress.

Arizona’s ballot initiative process is being abused by agenda-driven outsiders. The upcoming election provides an opportunity for Arizonans to take back control of the initiative process though common-sense reforms that increase transparency, respect the voices of all voters and prevent the state from being saddled with unintended consequences.

Suzanne Kinney is the president and CEO of the Arizona Chapter of NAIOP, the Commercial Real Estate Development Association.

THANK YOU 33rd Annual Community Project Donor’s for making this year’s project a success!

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9/1/21 21 1:59 PM

CONCORD GENERAL

50 YEARS OF INTEGRITY Celebrating five decades in Arizona, Concord General Contracting builds success on culture and principles By REBECCA L. RHOADES

A

lot has been said in recent years about the importance of corporate culture. More than a buzzword, it’s an important differentiator that sets a company apart from its competition.

Culture is what builds a brand’s identity.

It is shared values and goals. And when employees feel a personal connection to their company, they work hard to ensure its success.

Jim and Gary Jackson understood the importance of company culture

ROOSEVELT WATER CONSERVATION DISTRICT ADMINISTRATION AND OPERATIONS COMPLEX 22 | January-February 2022

long before it became embedded in corporate lexicon.

Fifty years ago, the brothers from Iowa traveled to Phoenix to study at Arizona State University. While in school, they realized there was a need in the Valley for a construction firm that operated with a high level of integrity, so they decided to start their own company. But rather than naming it after themselves, the pair wanted something that spoke to the

culture they hoped to foster, one built on principles of character and relationships rather than dollar signs.

The Jacksons settled on Concord.

Originating from the Latin roots “com,” meaning “together,” and “cor,” literally, “heart,” Concord in its most elemental form means unity. And in 1972, they founded a firm in Mesa, known as Concord General Contracting. Five decades later, the name endures — as do the principles behind it.

Jason Beaver

Grenee Martacho

“Jim had a vision that the business would bigger than him and that it would go well beyond his years,” explains Grenee Martacho of the timeless moniker. Martacho is the CEO of Concord General Contracting.

BUILDING RELATIONSHIPS For the first few years, the Jacksons worked mostly in framing and performed some minor residential work. In 1975, Concord completed work on its first religious institution, and in 1981, it finished its first school project.

As development in the Grand Canyon State continued to grow, so did Concord.

“Jim and Gary started out building a million dollars’ worth of projects,”

Martacho says. “Today, our revenues are around $65 million. The company’s portfolio centers on municipal, education, nonprofit and government development.

Notable projects have included the award-winning San Luis 1 Land Port of Entry in Nogales, Tucson Convention Center, 1891 Pinal County Courthouse Restoration, Westwood High School in Mesa and several facilities for Sun Valley Church.

“Our goal is to create great projects and great relationships with our partners and our clients, says Jason Beaver, COO of Concord. “We’ve chosen to focus on our relationships and our partnerships more than chasing some magical large annual revenue number.”

In 1992, Concord expanded its offices to Tucson. “Mesa has always been our home,” Martacho notes. “But in order to be successful in Tucson, you have to have a presence there — and not just a storefront.” To run the office, the firm hired John Nyman, a well-known figure in the city’s commercial real estate industry. Nyman later went on to become president and now shareholder and director of estimating.

“By opening an office in Tucson, we were able to divide and conquer,” Beaver remarks. The Phoenix teams handles projects located in the Valley and Northern Arizona, while the Tucson team handles everything from Casa Grande to the state’s southern border.

HILLENBRAND SOFTBALL STADIUM 23

CONCORD GENERAL

Concord General Contracting 50 Years in Arizona

1972: Jim and Gary Jackson found Concord General Contracting in Mesa.

Named Concord which means unity, or collaboration as the company refers to it today, the business would go well beyond the Jacksons’ years.

About 30 of Concord’s 45 employees are located in Mesa; the remainder work in Tucson.

Following Jim’s death in 2002, Gary decided it was time to pass the reins to a second generation of leaders. In 2006, joining Nyman on the executive team were industry veteran Dale Marr, who was named CEO, and Eric Peterson as CFO. At the time, Concord’s annual revenues had increased to between $10 million and $15 million.

“They really took us to even greater growth,” Martacho recalls. “But they also continued to focus on our culture, making it stronger. Through every generation, it’s always been a driving

1992: Concord expands into the Tucson market to better serve its clients statewide.

2006: Dale Marr, John Nyman and Eric Peterson named second-generation leadership.

2011: Focused on growth and defining its culture and brand, Concord puts in place its first strategic plan.

ROCK POINT CHURCH

2018: Concord becomes an employee stock ownership plan (ESOP) company, promoting each of its staff members to employee owners.

2019: Concord rebrands to reflect change and growth over the years.

2020: Grenee Martacho, Jason Beaver and JV Nyman are named third-generation leadership.

SAHUARITA REGIONAL LIBRARY

24 | January-February 2022

factor. We never want to lose that one element that has built who we are today.”

CONTINUED SUCCESS The late 2010s saw big changes for Concord. In 2018, Concord moved into its current location on West Broadway Road in Mesa. That same year, the third generation of leadership began.

Peterson retired in 2020. Marr followed suit on Dec. 31, 2021, and Nyman plans to retire in 2022. Marr and Nyman remain with the company as shareholders. Before stepping down, the trio turned to Beaver and Martacho and Tucson partner JV Nyman, to lead Concord into the future.

LEXUS OF TUCSON

Beaver began his career with Concord in 2003 as a project manager. “I’ve worked in every department since then,” he points out. Martacho joined in 2007 as a marketing coordinator before moving into business development. “I thought my initial job would a great stepping-stone, but the culture was very empowering. The company let me try different things,” she recalls. “I remember when I was hired on

by Dale Marr. He told me, ‘We like to work hard so we can play hard.’

“What’s great about working at Concord is that everyone can try new things.

We expect our employees to bring new creativity,” Martacho continues. “We’ll set the big picture, but we need the entire team to help us grow and get there.”

EMPLOYEE-DRIVEN Maintaining a balance of work and play is important to Martacho and Beaver.

“Because of our company culture, none of us, even Jason and me, have offices.

There are no doors,” Martacho says.

“That’s because we understand that in order for our entire team to be successful, we have to be available to each other. My favorite days are when I walk in the office and the place is full of people laughing and having good time.”

Open communication, an emphasis on teamwork and a respect for all levels of employees are cornerstones of Concord’s daily operations. “Sometimes in construction, you work in silos. Precon works in its own silo, operations has its own and so forth. At Concord, there’s no such thing as ‘that’s not my job,’” Martacho explains. “We’re a smaller team, and we do a large amount of revenue. It takes all of us working together to succeed.”

Empowering people to take ownership of their positions is just one way Concord instills pride in its employees — but that pride goes beyond job responsibilities. In September 2020, the firm transitioned to an employee stock ownership plan (ESOP). It’s an initiative that had been in the planning stages for more than a decade. “That was a huge accomplishment for us,” Martacho says. “An ESOP thrives on giving our employees the ability to have control over their projects and their careers.”

Currently, the firm is 30% owned by its employees and is planning for another sale in 2022. “The greatest part is that our team is personally invested in the company,” Martacho adds.

EMBRACING THE FUTURE As more and more national firms move into Arizona — and more local companies expand out-of-state, Concord continues to strengthen its reputation on the local level. “There’s so much growth right now in Arizona, and it’s exciting to be a part of it,” Martacho says. “When people find out that we’ve been in business for 50 years, they’re surprised.

They ask, ‘Where have you been?’”

In fact, Concord gets most of its jobs through architects or clients who have worked with the firm in the past.

As the firm steps into its next 50 years, Martacho and Beaver look to make Concord a recognized name throughout the entire state — with one proviso. “The most important thing for me is to see Concord evolve and grow and continue to elevate the industry while still maintaining who we are,” Beaver says. “It’s not just about the building process for us. Anyone can build a building. We want to bring something else to the client.”

Martacho agrees. “What sets us apart is our culture. That's why we've been in business for 50 years. And that's why we're going to continue to be in business 50 years from now.”

25

BOMA

QA &

I

n late November, BOMA Greater Phoenix, the industry group that advances the commercial real estate industry through advocacy, influence and knowledge, elected its 2022 officers and board members. Melissa Scott, property manager at Sunbelt Holdings, was named president.

Scott started in property management in 2005, and she has successfully managed a variety of properties, including industrial, medical and owner associations.

As a member of BOMA for the past six years, she has served on the board of directors and was vice president in 2021. She has chaired the organization’s TOBY Awards committee and currently serves on the Programs & Events group.

We asked Scott about her plans for her term and where she hopes to lead BOMA.

AZRE: What is on the top of your

agenda as the new president of BOMA Greater Phoenix?

MELISSA SCOTT: As the incoming

president for BOMA Greater Phoenix for 2022, I will continue to focus on building our membership and working with our committees to bring quality educational events to our members.

AZRE: In what ways has BOMA

Greater Phoenix progressed and evolved recently, given the COVID-19 pandemic that affected every industry across the country?

SCOTT: BOMA Greater Phoenix has done a wonderful job pivoting to

26 | January-February 2022

with BOMA President Melissa Scott

the online platform that has taken over professional industries. Our staff and committees provide flexible meeting opportunities so that all of our members and partners can stay engaged with the organization.

AZRE: What are the organization’s legislative priorities for 2022?

SCOTT: BOMA will continue to

work with our advocacy partners on legislation that helps leverage Phoenix as a corporate destination.

AZRE: What are some reasons for BOMA members to be optimistic, and what challenges do you still see in the future?

SCOTT: Due to the COVID-19

pandemic, many industries, including commercial real estate, were forced to pivot and become more flexible and innovative. It will be exciting to see what the future holds for our industry. Reengaging the work force has been and will continue to be a challenge as we see how professionals have adjusted their work-life balance over the past 18 months.

AZRE: What can we expect from BOMA Greater Phoenix moving forward?

SCOTT: BOMA Greater Phoenix is

dedicated to continuing to engage with the commercial real estate industry and bringing educational and relevant material to our members to help them grow and succeed.

COMING NEXT ISSUE FEATURED TOPICS INCLUDE:  Check out the finalists for the 2022 RED Awards  A look at the factors driving development in the West Valley  Here are the trends impacting building in Indian Country  A look into the impact of the pandemic on hospitality and tourism construction

For additional information call 602.277.6045 or visit

azBIGmedia.com

27

BOMA

BOMA Greater Phoenix

Outstanding Building of the Year Awards 2021

T

he Outstanding Building of the Year (TOBY) Awards recognize quality in buildings and reward excellence in building management. Five buildings were honored by BOMA Greater Phoenix during its 2021 awards presentation, held on Nov. 12. Entries were judged on community involvement, site management and environmental and “green” policies and procedures. Following are the 2021 award winners.

EARTH

GSA Professional Office Building Management company: Ryan Companies US Property manager: Amanda Forsmo

28 | January-February 2022

100,000 TO 249,999 SQUARE FEET

artHAUS Management company: Bridge Commercial Real Estate Property manager: Janalee Jackson

INDUSTRIAL

Lighting Unlimited Management company: A Brighter Idea Property manager: Cory Schneider

MEDICAL OFFICE BUILDING

St. Joseph’s Westgate Medical Center Management company: Davis Southwest Property manager: Kathryn Rhinehart

RENOVATED BUILDING 201 E. Washington Management company: Transwestern Property manager: Monica Greenman

29

EAST VALLEY FOCUS

GATEWAY TO PROSPERITY

I

n 2020, a study by J.D. Power ranked Phoenix Sky Harbor International Airport as the best major airport in the U.S. While many travelers coming to or departing from the Valley pass through Sky Harbor, it isn’t the only runway in town.

About 30 miles to the southeast is Phoenix-Mesa Gateway Airport, which originally was an Air Force base where more than 26,500 pilots trained over a 52-year period. Gateway Airport now offers non-stop flights to 60 cities and hosts more than 40 companies, with an annual economic impact of $1.3 billion to Arizona’s economy.

The land surrounding the airport, known as Mesa Gateway, has become a magnet for industry, with developments including the 1 million-square-foot speculative industrial building Elliot 202 and an $800 million data center by Meta, the parent company of Facebook, in the works.

FACEBOOK DATA CENTER 30 | January-February 2022

According to Mesa Councilmember Kevin Thompson, who represents Mesa Gateway as part of District 6, the accessibility of the area is attracting more industrial users. “Just the fact that SR 24 is coming has accelerated projects that have been looming in the background for years. Developers are seeing the nexus of everything coming together and they want to be part of that,” he says.

Between the availability of land and growing connectedness of the region, development in Mesa Gateway is thriving.

A LIMITED RESOURCE The esteemed American author Mark Twain once quipped, “Buy land, they’re not making it anymore.” Indeed, even in a sprawling city such as Greater Phoenix, space is at a premium.

The Southwest Valley is uniquely constrained due to surrounding state and tribal land. Despite the

Industrial users are fueling growth in Southeast Mesa

By KYLE BACKER

restrictions, industrial users are still scouting out the area.

“When I first got elected in 2015, I had developers telling me they wanted to build residential near Gateway saying, ‘You’ve got 200 years’ worth of land that you’ll never use,’” Thompson recalls. “Here we are seven years later, and even though there’s still land, it’s hard sometimes to parcel together enough of it when you have a big user that comes in and wants a millionsquare-foot facility.”

The appetite for larger space is something of a novelty for the Southeast Valley. Steve Larsen, managing director at JLL, notes that, historically, the Mesa Gateway area attracted smaller to mid-bay clients looking for 15,000 square feet to 50,000 square feet.

“Now, it’s closer to 150,000 square feet on average. There are some very large users — a million square feet or more — which we’ve never seen before

in the past,” he says. “The market is maturing and evolving.

“What we’re seeing is that industrial users have become more sophisticated,” Larsen continues. “A lot of groups are looking to take advantage of the cubic feet, not just the square footage, so they can rack higher and be more efficient.”

Zoning and land use attorney Adam Baugh, partner at Withey Morris, agrees that development in the Mesa Gateway area has momentum. He describes the pandemic as an accelerator for industrial demand since more companies want to have logistics and manufacturing closer to the customer.

The City of Mesa has also done its part to attract businesses. A strip of land north of Gateway Airport that stretches from Hawes Road to Signal Butte Road has been designated the Elliot Road Technology Corridor. The corridor is a planned area development zone placed over an existing base zone, which streamlines the entitlement process for advanced manufacturing and technology related businesses, such as data centers, by granting light industrial zoning without requiring action from the Mesa City Council. Thompson estimates that the provisions in the overlay can reduce the time needed to start construction from one year down to eight weeks.

A similar overlay, the Pecos Advanced Manufacturing Zone, exists south of

Adam Baugh

Josh Tracy

Gateway Airport. Baugh explains, “If people opt in, they avoid the zoning process and a public hearing on a site play. They also get to design review faster. Mesa is motivated to attract those types of jobs and has set up an easier regulatory path to make those projects more likely to happen.”

LABOR AND ACCESS While the ease of building is enticing for industry, it is not the only criterion used for evaluating possible locations.

A world-class facility is useless if there aren’t enough employees to perform its desired function. Mesa Gateway, however, isn’t lacking qualified workers.

Josh Tracy, vice president of development at Ryan Companies, argues that the area is unique in that there’s a potent mixture of labor, available land and a supportive municipality.

Steve Larsen

Kevin Thompson

“The Southeast Valley has a talented, educated labor pool that supports companies such as Intel, Honeywell and Boeing. That, in turn, attracts higherend industrial products that are a bit more employment heavy, which provide quality jobs for the community,” he says.

New homes being built close to Mesa Gateway means that companies can tap into a pool of nearby workers. Thompson mentions that the Eastmark, Cadence and Bella Via housing developments represent a growing section of the city.

“Southeast Mesa has a highly skilled, highly educated workforce. That includes everyone from attorneys to doctors, blue collar and white collar — you name it.”

Also spurring growth are a series of nearby transportation corridors. The proximity of the Loop 202 makes it easier for workers from Chandler and Gilbert to travel to Mesa Gateway. The

31

EAST VALLEY FOCUS recent expansion of the Loop 202 around South Mountain provides access to labor in the Southwest Valley. State Route 24 also serves as an efficient commuter funnel.

“Right now, you have a lot of vehicles that are moving in and out of San Tan Valley and Queen Creek as people go to work in the morning and come home in the afternoon. There are upwards of 80,000 vehicles per day traversing SR 24 to get out of San Tan Valley and that portion of Pinal County,” Thompson notes. “Businesses are wanting to take advantage of that and locate close to the labor force.”

Moreover, Thompson hopes that Union Pacific’s plans to construct a 5-mile-long rail spur, known as the Pecos Industrial Rail Access and Train Extension, near Pecos and Sossaman roads will come to fruition.

“Some of the nearby companies such as CMC Steel have been pushing for the rail line for quite some time. From their perspective, a rail spur coming in and out can help alleviate a lot of the truck traffic from shipping their rebar,” he says. “There’s also a lot of logistics and supply chain companies that are looking to be located next to the rail spur. It’s a nicety for some businesses and a must-have for others.”

CURRENT DEVELOPMENT With the market ripe for more industrial users, there are ample opportunities to profit on the area’s attractiveness. For example, national real estate development and investment firm CRG is developing The Cubes at Mesa Gateway, which when complete will comprise approximately 4 million square feet of speculative and build-to-suit space.

Larsen explains that The Cubes sits on a 268-acre piece of land that had been on the market for some time.

“As investments in the Southeast Valley continue to grow, people have larger appetites. I mean, almost 300 acres is a very big pill to swallow. But you’ve got groups that are buying into what is going on in the Southeast Valley, and CRG capitalized on that,” he says.

So far, the investment thesis is working. “We already have multiple users looking for upwards of 500,000 32 | January-February 2022

THE CUBES AT MESA GATEWAY

square feet with offers being traded,” Larsen continues. “We have tremendous activity from Fortune 100 companies that are currently evaluating The Cubes. We think this is going to be the premier site for large box industrial in the region.”

The Cubes’ massive campus will lend itself to multiple users. Baugh believes its flexibility is a great asset.

“The buildings can be single-or multitenant, depending on what the market wants and needs. Everything is in place to allow CRG to succeed, from the right design architecture to the proper parking ratios to adjacent roadway access — those kinds of things will propel this project forward.”

Nearby, Ryan Companies is building Confluence at Mesa Gateway. Positioned on 35 acres, the development will feature six speculative industrial buildings ranging from 32,000 square feet to 176,000 square feet.

“We have the opportunity to get a diverse mix of tenants with what we feel is best-in-quality space,” Tracy notes. “This includes 32-foot clear heights, 7-inch reinforced slab, 3,600 amps of power with room for more — we’re trying to hit the best standards we can in the market.”

The project is built to what Tracy calls the bread-and-butter of the

Southeast Valley industrial space, from 30,000 to 100,000 square feet.

“There are some pioneers out in Mesa Gateway with million-squarefoot buildings, and so far those have been successful,” he says. “But we wanted to focus more down the middle of the fairway and what has historically leased and done well — the single loaded, high-quality industrial buildings, with the ability to do high-end office suites in the front and warehousing or manufacturing space in the back.”

Ryan Companies is also pursuing LEED certification for Confluence, which is unique for speculative projects. “As we continue to see sustainability be an important factor to large companies, we wanted to further differentiate ourselves with a LEED certification on the buildings, making it so that we can accommodate solar panels on the roof in the future, along with provisions for putting conduit in the ground now for electric vehicle charging stations,” Larsen says. “We’re trying to create a long-term asset that will be successful for the community, investors and the environment.”

Mesa Gateway has changed greatly since it was home to the Air Force’s premier pilot training facility, but the area is shaping up to be an industrial powerhouse for decades to come.

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RISING STARS FOR 2022 CRE’s brightest young professionals are shaping the future of the industry

T

he great Roman emperor Julius Ceasar in 52 B.C. recorded the earliest known version of “Ut est rerum omnium magister usus” — generally put, “Experience is the best teacher.” While that age-old adage has stood the test of time, there’s something to be said about the drive, energy and imagination of those in the early stages of their careers.

While there has been a lot of talk about the need for younger generations to join the commercial real estate (CRE) industry, those who have in recent years are proof positive that CRE offers a rewarding and exciting future. Whether they’re in real estate sales, design-build, marketing or finance, today’s rising leaders are making big impacts in an industry that’s moving at one of its fastest paces in history.

They’re driving change through innovation, harnessing technology to get work accomplished faster and with less cost, and influencing the growth, prosperity and quality of life in Greater Phoenix and throughout Arizona.

This year, we’re recognizing 22 of the top young professionals who are poised to push the CRE industry forward in 2022 — and beyond.

MORGAN BETANCOURT

Project Director, Okland Construction Years in CRE: 10 Betancourt, who started her career at Okland Construction, has taken part in multiple healthcare projects, life science buildings and a new sports complex in the Greater Phoenix area and currently manages approximately $100-plus million annually. She is passionate about the construction industry’s future and is actively engaged in Okland’s recruiting committee in an effort to guide the next generation. She also participates in Arizona Construction Career Days and serves as the fundraising chair for the Phoenix ACE Mentor Program.

What do you love about CRE? “I love the people in the construction industry! I enjoy partnering with owners and architects who are always creating original designs, challenging the ways we get to build really cool things, and trade partners who bring that originality to life.”

34 | January-February 2022

NAYAN BHAKTA

Vice President of Preconstruction for Renewable Energy & Storage, McCarthy Building Companies Years in CRE: 11 Bhakta has been instrumental in more than quadrupling the renewable group’s solar footprint in the last year and a half, leading his team to identify and implement best value designs and solutions for more than 5 gigawatts of utility-scale solar and energy storage projects.

He also developed a 90-day program that guides new team members and helps them navigate and transition to remote solar project locations.

His onboarding policies have been so successful that they have been adopted, in some fashion, across McCarthy’s 16 offices.

What advice to you have for other young professionals in your field?

“Always be open to stepping outside of your comfort zone to trying something new. I started my career in renewable energy after spending time in the petrochemical construction industry, and I knew next to nothing about solar power, but I am not only thriving in this industry now, I truly love it.”

MARK CASSELL

Vice President, LevRose Years in CRE: 6 Cassell specializes in investment sales for net-leased properties.

Thanks to a persistent work ethic, he offers the most accurate and up-to-date knowledge on the market and provides a diligent service tailored to his clients’ needs. As a member of TCN Worldwide, he is able to access more 200 markets globally, which allows him to meet his clients’ needs on an international level. He also is involved in ICSC and NAIOP locally and nationally.

What do you love about CRE? “There is such a wide variety of people who make this career interesting. I love that the investors and owners I work with come from all walks of life. Each one of them is successful but brings a different attitude to the way they look at each deal.”

ANDERS ENGNELL

Planning & Development Lead, Culdesac Tempe Years in CRE: 7 Engnell builds masterplanned mixed-use communities for people, not cars. Since 2018, he’s been a part of the acquisition, entitlement and construction — and now leads the continued design and construction — of the $170 million 17-acre Culdesac Tempe, the first car-free neighborhood built from scratch in the U.S. A Tempe resident, Engnell is an avid volunteer for the Tempe Community Action Agency, where he’s on the Escalante Community Garden and Emerging Leaders boards, and he’s an active leader and mentor with ULI and the American Planning Association.

Describe a career highlight “The moment when Culdesac Tempe received the first-ever entitlements for a car-free neighborhood in the U.S. was a special one for me. As an urban planner by background, I knew we’d scaled a monumental barrier to building places for people.

This precedent has opened doors for other communities to build with reduced to zero parking requirements for residents.”

TINO HERNANDEZ

Assistant Project Manager, Willmeng Construction Years in CRE: 7 Hernandez began his career with Willmeng as an intern and has worked his way up to project engineer, estimator and now assistant project manager. A native Phoenician, he is proud to be on the board of the Phoenix Union Foundation for Education, a nonprofit that supports the staff and student community of the Phoenix Union High School district with scholarships and grants. He’s also is an active member of NAIOP, completing the Young Professionals Group program and being a part of the public policy committee.

What do you love about CRE? “I’m fascinated with the development and design of the built environment, especially adaptive reuse and mixed-use projects. The ability to create and build the ‘live, work, play’ lifestyle in urban environments by adding new construction and repurposing old buildings for new uses excites me.”

SHANNON HERSKER

Director of Capital Markets, Walker & Dunlop Years in CRE: 10 Responsible for nationwide loan origination, Hersker focuses on multifamily and build-for-rent assets.

As the client interface throughout the overall loan process, she is involved in underwriting, contacting lenders and securing loan quotes and overseeing the closing process. Because of her leadership and personal touch, she was made partner on her team after only two years. Hersker also is active in ULI, NAIOP and Valley Partnership, as well as several charitable organizations, including Brokers for Kids.

Describe a career highlight “Right before I joined Walker & Dunlop, I began to see a trend in the build-for-rent space. I told my new team that this is going to be the next best thing and that we have to become the experts in the space. We are now one of the leading lenders in that space nationally and are working on a billion dollar pipeline.”

JAKE HINMAN

Partner, Capitol Consulting Years in CRE: 14 With nearly 15 years in the public policy arena representing clients in the CRE industry, including a $4 billion rental real estate interest, Hinman provides lobbying and public affairs services at the legislative, county and municipal levels and is responsible for bill drafting, stakeholder outreach, legislative testimony and assembling political support for the passage or defeat of measures. He has worked on a variety of CRE issues, from taxation to land use policy to property rights.

Describe a career highlight “Certainly getting the first bill signed into law. It’s a grueling process, especially depending on the level of controversy.

But any time you’re able to get your client’s issue addressed or policy item passed by the legislature or city council, it is a highlight.”

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EMERGING LEADERS KHARA HOUSE

Director of Community Engagement, Bella Investment Group Years in CRE: 8 House manages a variety of company initiatives, including public relations, legislative updates, establishing various community and civic relationships, and addressing escalated resident concerns.

Her work focuses on creative interpersonal collaborations, with a strong advocacy for the industry on the local, state and national levels. Her dedication to professional excellence has led to numerous community leadership positions, industry board and committee appointments, and awards and recognitions, including the Arizona Multihousing Association Corporate Team Member Tribute Award and the Flagstaff Key to the City Award in 2020.

Describe a career highlight “Receiving the National Apartment Association’s Emerging Leader Excellence Award. It recognized my numerous professional roles and partnerships, my industry advocacy and my dedication to community development, civic engagement and addressing various industry and community challenges.”

CHAD KIRKORSKY

Partner, Citywide Commercial Real Estate Years in CRE: 6 With a unique insight into the Valley’s market developed over a lifetime in Arizona, Kirkorsky focuses on the sale and leasing of industrial office and warehouse space. He represents clients in tenant relocations, tenant expansions and investor acquisitions, applying his extensive knowledge of the market and a tech-savvy focus that gives him — and his clients — a competitive edge that delivers proven results.

In 2018, Kirkorsky and two partners founded Citywide Commercial, which they’ve since grown to 10 brokers.

What advice to you have for other young professionals in your field?

“Instead of trying to become a jack-of-all-trades, pick a specialty, focus on it and try to become the best you can be.”

36 | January-February 2022

CHELSEA LAW

Operations Manager, Arizona, New Mexico, San Diego; Marcus & Millichap Years in CRE: 3 In 2020, when there was a need to provide additional operational support to the San Diego office, Law oversaw the brokerage, personnel and operations for both it and the Phoenix office, implementing a collaboration that centralized office support and improved productivity — and ultimately led to a larger model that has been adopted throughout the firm. Today, Law oversees a collaboration that consists of Phoenix, San Diego and Denver and has been a crucial part of leading these offices into their most successful quarter to date.

What’s a surprising fact about you?

“I lived in Ireland for nearly four years with my husband and two children. This allowed me to experience new cultures, as well as learn to adapt in new environments, and it has benefited me in many ways, both personally and professionally.”

MOLLIE MORONEY

Director of Development, Barclay Group Years in CRE: 7 Since joining Barclay Group in 2015, Moroney has played a critical role in the development of more than $400 million in new projects throughout Arizona and other Western states. She focuses on raising capital in addition to managing the entitlement, acquisition, development and disposition/ refinancing of new projects.

Moroney is an active member of ICSC, NAIOP and ULI. What do you love about CRE? “I love that with each day comes new challenges, both big and small, and that I have the privilege of working with great people from whom I am constantly learning.

I’m grateful to be a part of the CRE industry during such an exciting time for Phoenix and other high-growth markets in the Western U.S.”

THOMAS MYZIA

TAYLOR PERKINS

What are your professional strengths?

“I have a constant need to push the envelope for technology in the construction industry. I have developed and deployed multiple software tools that are used in the day to day operations within the Kitchell offices.”

Describe a career highlight “Just prior to the onset of the pandemic, I oversaw a partnership between CHASSE and Agua Fria High School to build 60 picnic tables for their campus — as well as some for partners in need — through the Better Building Project, which gives students a hands-on volunteer project, teaches them a trade skill and helps them create something of their own using teamwork.”

BRIANNA NESSLER

ALANA PORRAZZO

Preconstruction Estimator II, Kitchell Years in CRE: 6 A native Chicagoan with bachelor’s and master’s of science and engineering degrees from Arizona State University, Myzia is passionate about adopting and implementing new technologies to improve productivity and collaboration and is excited to help drive innovative ideas and solutions during preconstruction. He works collaboratively with owners, architects and subcontractors to establish realistic cost models in an ever-changing market and recently completed the procurement of the new $345 million Valleywise Health Medical Center in Phoenix.

Marketing Director, Small Giants Years in CRE: 8 As the leader of Small Giants’ marketing team, Nelson creates a collaborative environment that fosters successful client strategies and repeatedly translates into impactful marketing initiatives. In addition, she has an OSHA 10-hour Construction Training certification and was the first female in the industry to receive a Section 333 Exemption-Drone pilot certification.

Her dedicated involvement in the CRE industry led to her being included in Engineering News-Record’s ENR Southwest’s 2018 Top 20 under 40 list.

What advice to you have for other young professionals in your field?

“Be humble and set goals. Identify where in your career you want to be in five years, acknowledge any gaps in your skill set, network or experience that will hold you back from getting there, and create a plan for yourself to fuse those gaps.”

Business Development Manager, CHASSE Building Team Years in CRE: 5 Perkins works with CHASSE’s K-12 team to build and rebuild schools across Arizona. She helps school districts provide proactive and hands-on education experiences for students and faculty before, during and after building engagements, including STEM programs in the classroom, construction field trips and community outreach projects. Perkins also serves on the board for Careers in Architecture, Construction and Trades Uplifting Students and several education foundations.

Construction Law and Surety & Fidelity Attorney, Jennings Haug Cunningham Years in CRE: 5 Porrazzo specializes in defending bond claims and bad faith allegations, litigating performance defaults, prosecuting subrogation and indemnity claims and representing sureties in principal and indemnitor bankruptcies. She has developed a name for herself by regularly presenting at surety and fidelity law conferences, has authored numerous articles on complex topics for the industry and is the editor and/or co-author on multiple books addressing legal matters related to the industry.

What are your professional strengths?

“My reflective, analytical bent, coupled with a love of writing. Some of the most satisfying victories in my legal practice are those won by motions and briefs.”

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EMERGING LEADERS KELLY ROYLE

Associate, Industrial/Supply Chain & Logistics, JLL Years in CRE: 3 Royle specializes in representing property owners, developers and tenants in industrial sales and lease transactions, matching the business needs of industrial users with leasing opportunities offered by landlords.

With a background in design and construction, she supports her clients with project planning and feasibility. She currently serves on the NAIOP Arizona Developing Leaders Steering Committee as the Philanthropy Chair and was selected as a member of this year’s Young Professional Group.

What do you love about CRE? “As an Arizona native, I love watching my home state grow, and I feel as though I’m an integral part of that process. The relationship-based nature of CRE has encouraged me to get more involved outside of the industry, as well, through organizations such as UMOM, St. Vincent de Paul and St. Mary’s Food Bank.”

BENJAMIN TATE

Land use attorney, Withey Morris Years in CRE: 5 A second-generation Arizona native, Tate uses his extensive knowledge of development processes in municipalities and counties across the state to guide developers and property owners through every aspect of real estate development, from land use entitlements and zoning to site plan and design review. He has been recognized by his peers for excellence in land use and zoning law and has been honored in Best Lawyers’ “Ones to Watch” and Southwest SuperLawyers’ “Rising Stars.”

38 | January-February 2022

What are your professional strengths?

“Creative problem solving. By looking at a problem from all angles and being open to unconventional solutions that nobody else has considered, I’ve been able to solve development issues that would have otherwise left a project stalled for months or resulted in a costly redesign.”

JOSH TRACY

Vice President of Development, Ryan Companies Years in CRE: 8 With a nuanced and nearly encyclopedic knowledge of the Valley, Tracy is a valuable resource to Ryan’s development team — and its customers and partners. During his career, he has been participated in the development of more than 1 million square feet of commercial office space in Arizona and Washington and was the lead developer of the 68-acre Chandler Airport Commerce Park. He currently has five additional light industrial projects under construction in 2022.

Describe a career highlight “Winning two Best of NAIOP Awards in 2020 (Industrial Build to Suit of the year and Spec Industrial Project of the Year) for Chandler Airport Commerce Park. It was a wonderful way to cap a several-years project that overcame neighborhood, budget and weather challenges.”

JENNIFER VILLALOBOS

Vice President of Business Development & Marketing, Sharp Construction Years in CRE: 4 years Villalobos is successfully able to identify strategies that sustain the growth of the company and implements sales and marketing initiatives that increase brand awareness and revenue opportunities. She prides herself in giving back

and influencing the next generation of industry leaders. She is a founding member and current board chair of the American Cancer Society’s Latinos Contra el Cancer — Arizona Chapter and is an active member of NAIOP and ULI. What advice do you have for other young professionals in your field?

“Hustle at your job, get a mentor and invest in yourself!

The first 10 years of your career are so influential. As young professionals, we should be reaching out to mentors to help us think big and set high goals.”

BOBBY WUERTZ

Agricultural Land Advisor, Land Advisors Organization Years in CRE: 6 Wuertz pairs his life-long involvement with agricultural production and his real estate background to close successful land transactions for investors, farm families and agriculture investment funds.

He has a deep understanding of agricultural economics, commodity trading and land values as well as a commitment to the ongoing preservation and success of farming agricultural land. He is the founder of the Pinal 40 Organization, which promotes agriculture education and has raised and distributed more than $850,000 to support youth programs and scholarships for rural communities.

What are your professional strengths?

“Most important is the reputation I’ve established as a trusted advisor in both the agricultural world and with private equity and investment fund audiences. The ability to relate, adapt and listen to people from both of these very different worlds and bring parties together for their mutual benefit has helped me to excel as an agricultural land adviser.”

AUSTIN WILSON

Project Engineer, Earthscapes Years in CRE: 7 Growing up playing competitive sports helped Wilson develop strong communication and problem-solving skills. As project engineer for Earthscapes, a full-service landscape company founded by Haydon Building Corp, he oversees all aspects of a

job from start to finish. Currently, he’s working on the largest project of his career — the 320-acre Legacy Sports Park that’s scheduled to open this month in Mesa.

What’s a surprising fact about you?

“I’m an avid golfer. Before I got married and had my first child, I was aspiring to do a walk-on at the Waste Management Phoenix Open. That didn’t happen, but I still like to golf in my free time with my family and brother — and anyone else who would like to join me.”

BRYAN WRIGHT

Associate, Kimley-Horn Years in CRE: 9 Wright’s collaborative approach to design with contractors and owners of industrial, commercial, healthcare and multifamily developments helps deliver owner expectations with constructability and cost in mind, and he’s has built a strong reputation as a trusted partner to a wide range of clients, from cities and public agencies to leading commercial entities. In particular, Wright has years of experience working on large campus projects, helping plan future improvements while balancing the client’s needs for today.

What do you love about CRE? “My favorite part of CRE is creating lifelong friendships with clients and partners.

This industry has healthy cross section of people with different opinions and backgrounds, which helps bring out the best in projects and relationships.”

39

50 COMPANIES TO WATCH

THE NEXT BIG DEAL These 50 CRE companies look to transform Greater Phoenix in 2022

A

rizona is scorching hot, and we’re not talking about the weather.

Following 2020’s uncertainty, the commercial real estate (CRE) industry showed no signs of slowing down in 2021, with many companies reporting unprecedented amounts of business, from the number of construction projects underway to the record-breaking size of individual deals to the dollar amounts trading hands.

At the forefront of these transactions are the 50 businesses highlighted on the following pages. As some of the top CRE companies in Arizona, they’ve seen tremendous growth in 2021 and will be the ones driving the industry forward in 2022.

WITHEY MORRIS 40 | January-February 2022

41

50 COMPANIES TO WATCH ALSTON 2021 was a big year for Alston Construction, which celebrated 35 years of excellence. It was also a monumental year for its Phoenix business unit, which has been working on the highly anticipated 685,000-square-foot Brooklyn Bedding headquarters and manufacturing facility in Glendale and was just recently was awarded a project with MIG Real Estate. Under the leadership of seasoned construction veteran Mike Bontrager, the team will continue to grow in the industrial, commercial, office, healthcare, education and retail sectors in 2022.

BUTLER DESIGN GROUP

ARIZONA LAND CONSULTING Since its founding in June 2020, Arizona Land Consulting (ALC), a Phoenix-based land investment and consulting company that specializes in commercial real estate, has closed on $70 million in land transactions.

Founder and CEO Anita Verma-Lallian, who also owns Equity Land Group, utilizes relationships she has with brokers and land-owners to provide offmarket properties to 1031 exchange buyers. In August 2021, ALC closed on four separate properties totaling $17 million in a matter of two weeks in the West Valley.

BUTLER DESIGN GROUP Butler Design Group (BDG) is an employee-owned Phoenix-based architecture and planning firm with more than 25 years of experience.

In 2021, the firm completed several key projects, including Lagerhaus, Cavasson and Creighton University at Park Central and received the NAIOP Architect of the Year award for the 16th time. Looking to 2022, BDG is excited to see many projects being completed, including Goodyear Civic Square, which includes the new Goodyear City Hall and three-story office buildings surrounding a public park. Always continuing to grow and expand its diversified portfolio, BDG has enjoyed an amazing 2021, and the future looks just as exciting.

CAWLEY ARCHITECTS Celebrating more 25 years as one of Arizona’s most prolific architectural 42 | January-February 2022

CAWLEY ARCHITECTS

firms, Cawley Architects looks forward to advancing client initiatives for the next 25. It has completed more than 20 million square feet of projects designed and executed during that time in the industrial, manufacturing, distribution, healthcare, education, mixed-use, office, retail and multifamily sectors. Recent successes include the state-of-the-art 52,250-square-foot Life Recovery Building for the Phoenix Rescue Mission; the 96,400-square-foot Auto House facility; a fourth 40,100-square-foot Adelante Primary Healthcare facility; and the 31,800-square-foot Felix Construction Corporate headquarters.

CLAYCO Founded in 1984, Clayco is a national design-build firm dedicated to innovation and the art and science of building. The company relocated its residential business unit headquarters to the firm’s newly established

Phoenix operations in 2021 and began transforming the downtown skyline with several multifamily high-rises under construction, including Skye on 6th, PALMtower and X Phoenix Phase 2.

In 2021 alone, Clayco’s Phoenix office was awarded more than $800 million in industrial, residential and commercial projects. Led by executive vice president and partner Anthony Johnson and newly appointed residential business unit leader Eric Jaegers, the Phoenix operations now include more than 60 local hires.

COLLIERS INTERNATIONAL OF ARIZONA Colliers in Arizona posted its historically best year in 2021, completing more than 1,000 transactions and helping its clients make more than $4 billion of important real estate decisions. Some of the key transactions included the

PROMISES MADE.

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Let us elevate your project.

602.485.1950

STEVENSLEINWEBER.COM 43

50 COMPANIES TO WATCH 1.2 million-square-foot expansion of MLILY in the West Valley, the $157 million sale of the Sueba USA multifamily portfolio in Texas and earning the assignment to handle Heartland Dental’s 1,000-plus U.S. locations. This past year, Colliers completed the largest deal in Arizona history, the $1.2 billion refinancing of Grand Canyon University.

COMMERCIAL PROPERTIES INC. Commercial Properties Inc. is a full-service brokerage and property management firm specializing in office, industrial, retail, multifamily, land and more. 2021 marked the firm’s 40th anniversary as the largest locally owned commercial real estate brokerage in the Valley. According to the company, the outlook for 2022 is positive. Arizona is seeing continued growth and the local economy is performing well. Companies continue to move to the state for competitively priced office space, affordable living and lack of operational obstacles or barriers to entry for their businesses.

CONCORD GENERAL CONTRACTING Concord General Contracting is a well-established mid-sized firm that excels in the collaborative construction of quality commercial, municipal, educational and nonprofit projects

throughout Arizona. For 50 years, Concord has partnered with architects and clients to provide creative solutions to maximize return on construction investments. The firm’s experienced and pro-active team is its magic ingredient. Being an Employee Stock Ownership Plan (ESOP) company, Concord comprises employee-owners who are personally vested in the success of their clients’ projects, as it benefits everyone at the end of the day.

CORE CONSTRUCTION CORE operates locally in Arizona with 200 employees across five offices.

Its projects help build and shape communities through the construction of great schools, universities and public safety facilities. Led by Todd Steffen, president of CORE, its team is united under the desire to build for the future. 2021 marked another outstanding year in the public safety sector with over a dozen new police and fire projects started and the completion of the Town of Gilbert’s Public Safety Training Facility which included 150,000 square feet of new construction over an 18-acre villagestyle tactical training campus and a 36-acre tactical driving track.

CORESLAB STRUCTURES Coreslab Structures provided total precast concrete solutions for

projects across the Southwest in 2021, including the Arizona State University Multi-Purpose Arena, the Marine Corps Air Station parking deck in Yuma, two total precast parking garages for the Scottsdale Entrada project and the eighth total precast parking garage at Grand Canyon University, with more parking garages and several data centers in the pipeline for 2022. The Arizona plant introduced CarbonCure, a new technology that reduces embodied carbon with CO2 mineralized concrete to provide lowcarbon solutions.

DEREK BUILDERS Derek Builders is an Arizona-grown general contractor that specializes in commercial and industrial construction. The company is made up of competent, professional and highly regarded individuals who utilize their extensive experience to provide an extraordinary level of personalized construction services to their clients.

Derek Builders continues to attract new partnerships, clients and some incredible projects, including Amazon DTU3 in Chandler, Amazon DPX4 in Tempe, and Prologis Commerce Park in Goodyear. Based on its 2021 momentum and current pipeline, Derek Builders is projecting a strong 2022 as it increases its activity in the industrial, medical, senior living and cold storage space.

DOC PROPERTIES

DEREK BUILDERS 44 | January-February 2022

As the Valley experiences the nation’s fastest population growth, physicians are struggling to keep pace with the exploding demand for medical services. Healthcare real estate investment services firm Doc Properties, led by Trisha Talbot, helps many identify new or existing medical properties aligned with their specialized needs, cash flow and profitability goals. The firm connects physicians with expansion goals to investors looking for income-producing properties, and Talbot provides extensive healthcare market knowledge and a data-driven approach that help clinicians and investors increase profits and manage occupancy costs while focusing on providing quality care.

DELIVERING VALUE BEYOND THE BUILDING Prologis (NYSE:PLD) was founded in 1983 and is now the world’s leading industrial REIT with 39 years in the Arizona market. Locally the company currently owns and manages in excess of 12 million square feet in 70 buildings with 150 customers. We currently have over one million square feet under construction with an additional 2 million square feet planned construction in the greater Phoenix metro area. The company’s mission is to deliver logistics solutions and services at scale so you can spend more time doing what you love – growing your business.

INDUSTRIAL

LAND ACQUISITION

DEVELOPMENT BUILD-TO-SUIT

SIMPLIFIED LEASING

LET’S GET STARTED Every connection starts with a conversation. Our team is here to help.

Phoenix 2525 E. Camelback Road Suite 400 Phoenix, Arizona 85016 Main: +1 602 474 8350

Twitter: @prologis | www.prologis.com 45

50 COMPANIES TO WATCH work, with numerous projects in development across Greater Phoenix, and 2022 will see the completion of The Kimsey, a residential mixed-use design in Scottsdale; Studios at Mesa City Center; Comarch Data Center; and the Insight Headquarters in Chandler.

GEORGE OLIVER George Oliver is a Phoenix-based developer that specializes office and industrial work spaces, believing that happy and healthy office environments enhance productivity, improve employee retention and help a business stand out in an increasingly competitive marketplace.

This approach can be seen in its many projects, including CASA in Phoenix’s Uptown neighborhood, The Alexander and The Johnathan in downtown Chandler, and Lofts at The Quad in South Scottsdale. The firm recently unveiled plans for Arbor, a $41 million experiential renovation that will transform a mixed-use campus in Tempe into an “Urban Organic” office and retail destination.

DP ELECTRIC

GRAYCOR CONSTRUCTION

GEORGE OLIVER

DP ELECTRIC DP Electric was founded in 1990

by Daniel Puente and since then has become one of the leading full-service electrical contracting firms in Arizona with 400-plus field electricians.

In 2021, DP Electric became an employee-owned company providing an additional retirement benefit to its 500 employees. DP Electric specializes in large corporate office, healthcare, industrial, aviation, mission critical and higher education projects.

The firm also offers DP University apprenticeship program to all its employees. This National Center for Construction Education and Researchaccredited apprenticeship program is designed to give craft professionals an unmatched education experience.

EPS GROUP Based in Arizona with offices in Mesa, Phoenix and Tucson and a new office in Loveland, Colorado, EPS Group is the largest locally owned civil engineering firm in Arizona.

46 | January-February 2022

Founded in 2003, EPS Group provides civil and municipal engineering, planning, land development, surveying, water resource, landscape architecture and construction management services, and its expertise ranges from major public works infrastructure to largescale private developments. Over the past five years, EPS Group has grown 20% year over year. To maintain exceptional client service levels, the firm has increased its associate count by nearly 70 percent during this fiveyear period.

GENSLER The architecture and design firm unveiled its new office at the Esplanade in Phoenix in 2021. This location expands the firm’s presence in the Valley with a retail-level space that was repositioned to act as a LivingLab while adapting to the changing nature of the workplace. Gensler has seen growth in residential/mixed-use, workplace and technology, and municipal sector

Based in Phoenix, the Southwest Division of Graycor Construction Company represents more than 35 years of local relationships and projects in the cold storage, corporate, food processing, living/lodging, logistics/ distribution, manufacturing, retail and tenant improvement markets.

In 2021, the Southwest Division’s team of 25 was strengthened by an expanded leadership team, including construction president Tim Hanifin, operations manager Rusty Martin and construction manager Geovanni Villalta. Graycor’s current pipeline of 3.2 million square feet of Class A industrial space includes G303, Metro East Valley Commerce Center Phase III, Gilbert Spectrum Buildings 9-11, Elliot Gateway and 77 Buckeye.

HARVARD INVESTMENTS Headquartered in Scottsdale, Harvard Investments creates and develops award-winning residential communities, second home and resort communities, investment properties, and Class A offices and warehouses.

With almost 40 projects throughout

REDEFINING COMMERCIAL REAL ESTATE

BEST-IN-CLASS SERVICE. UNPRECEDENTED VALUE.

CULTURE

Scottsdale Fashion Square Office Building 7150 East Camelback Road, Suite 425 Scottsdale, AZ 85251

www.ORIONprop.com

| 480.634.6934

50 COMPANIES TO WATCH JOKAKE Jokake was founded nearly 40 years ago on the principal of providing creative solutions for the commercial real estate industry. Its team has aligned with the growing market demands, focusing on five key sectors: industrial and manufacturing, biotechnology, healthcare, commercial office and public. By welcoming biotechnology companies to Arizona and building new labs and research facilities, erecting iconic buildings for Fortune 100 clients or partnering with developers for executing a pipe dream, Jokake’s history of “building cool things” continues to develop into 2022.

JLL

LAYTON CONSTRUCTION

Greater Phoenix, Harvard made news in October when, under a jointventure partnership with Toll Brothers and Värde Partners, it acquired the remaining 18,000 acres of undeveloped land in Estrella, a mixed-use masterplanned community in Goodyear.

HAYDON CONSTRUCTION In 2021, Haydon Building Corp celebrated its 30th year in business and was named ENR Southwest’s Contractor of the Year for its commitment to its employees and culture, as well as its strong portfolio of projects and record-breaking backlog. Significant projects in progress include Bell Bank Park (Legacy Sports) Athletic Fields and Infrastructure in Mesa, Yuma Regional Medical Center’s medical office buildings and the Lindsay Road/SR202 traffic interchange in Gilbert. Getting off the ground in 2022 are such projects as Prasada Village site development, Banner Payson Medical Center Expansion and Pima/Happy Valley Road improvements.

HINES Founded in 1957, Hines is a privately owned global real estate investment, development and management firm 48 | January-February 2022

that is particularly active in the Metro Phoenix market. 2021 saw the opening of Adeline Luxury Living in Downtown Phoenix, the sale of Chandler Viridian, ongoing construction on the 100 Mill project in Tempe, and continued development of the G303 industrial property in the West Valley. In 2022, Hines will continue redevelopment of Metrocenter and begin construction on the 250 Rio office project in Tempe, the Enclave Point and Nobella communities in Surprise, and The Hacienda at Carefree senior living development.

JDM PARTNERS With a 60-year history of real estate acquisition, development and management, JDM Partners is one of the largest owners of entitled land in Arizona. Its name is an acronym of its three owners: legendary sports executive Jerry Colangelo, David Eaton and Mel Shultz. JDM made headlines in 2021 with the $600 million sale of nearly 37,000 acres in Buckeye, which will be developed into one of the largest masterplanned communities in the country, Douglas Ranch. JDM will remain a joint venture partner on the project’s first village, Trillium, which expects more than 1,000 lot sales in 2022.

Since forming its Phoenix office in 2008, JLL has grown into a local market leader in office, industrial, retail, healthcare and data center brokerage; tenant representation; facility and investment management; capital markets; multifamily investments; and development services.

In 2021, the Phoenix team completed 75 million square feet in lease and sale transactions valued at $2.2 billion and directed $186 million in project management. It currently manages a 54.2 million-square-foot portfolio.

KRAUSE ARCHITECTS While celebrating 25 years as an architecture and interior design firm in 2021, Krause worked on a number of projects, including the complete redevelopment of the Desert Medical Campus, a four-building campus on six acres in Mesa, and the 4141 Project located in the heart of Scottsdale.

The firm is also working on a 100,000-square-foot headquarters for Vensure, a 60,000-square-foot studio space for Magellan and Foundations, 20,000 square feet of new law offices for Cavanagh Law Firm, and the East Gateway redevelopment. Krause has been published numerous times and recognized for design excellence as well as its philanthropic efforts.

LAND ADVISORS Scottsdale -based Land Advisors Organization was founded in 1987

by Greg Vogel. Today, the firm’s expert land professionals, who are

known for their expertise in masterplanned community and residential land development, serve 26 markets across 11 states. In 2021, Land Advisors Organization’s Metropolitan Phoenix team sold more 41,000 acres, facilitating more than 255 closings. The firm has been involved in many of the most significant land transactions of the year, including the recent sale of the 20,000acre Estrella master-planned community in Goodyear. In 2022, it plans to continue to expand into new markets as well as grow its capital advisory group.

earned NAIOP Arizona’s Owner/ Developer of the Year Award for the last three consecutive years. LPC developments are known for their bestin-class amenities. This includes rooftop decks at The Grand at Papago Park Center and outdoor employee dining and game areas at its mega industrial buildings at Park 303. Established in Phoenix 20 years ago, LPC Desert West serves a region spanning Arizona, Nevada, Utah and New Mexico.

MC COMPANIES

Spurred by significant growth in the office, industrial and hospitality market sectors, Layton Construction experienced unparalleled results at both the local and national level in 2021.

Building on several consecutive recordsetting years, a substantial backlog of major projects and a strong team of talented employees, this positive momentum is expected to propel the firm to another unprecedented year in 2022. Layton specializes in construction management, design-build construction and general contracting. As a part of the STO Building Group, Layton brings project experience throughout the U.S., Canada and Europe.

2021 marked the 20th anniversary of MC Companies, a Scottsdale-based multifamily investment, management and development firm headed by industry veterans Ken McElroy and Ross McCallister. To honor this milestone, MC embarked on Operation 25K, an initiative to grow from 6,500 to 25,000 units under ownership by 2029, and from 200 to more than 330 employees by the end of 2022. Achieving this will require the purchase of more than 2,500 units annually and involve new construction, including more than 1,100 units in the MC development pipeline.

The firm currently owns and operates approximately 7,000 units in Houston, Dallas, Austin, San Antonio, Phoenix, Tucson, Flagstaff and Tulsa.

LGE DESIGN BUILD

MCSHANE CONSTRUCTION

LAYTON CONSTRUCTION

For 27 years, LGE Design Build has been a leader in the Southwest’s commercial market by offering a fullservice, client-oriented model of design and construction. The company remained busy in 2021, working on projects such SOLLid Cabinetry in Chandler, Northern 101 in Glendale, The Porch in Gilbert, and Bottled Blonde and the Ortho Arizona Pima Center in Scottsdale. Business continues in 2022, with Airpark Logistics Center in Goodyear, 10 West Commerce Park in Buckeye, Kiff Enterprises in Surprise, and Fetzer Surgical and Juggernaut in Scottsdale. LGE Design Build was also named Arizona General Contractor of the Year in AZRE magazine’s 2021 RED Awards.

Nationally recognized as one of the country’s largest construction firms, McShane Construction Company has been active in Arizona since 2000.

In 2021, the firm’s rapidly growing team worked on more than a dozen

multifamily and industrial developments in the Phoenix area. Notable projects currently underway include Town Chandler, a 15-building 420-unit multifamily community in Chandler for repeat client Related Group, and Waterview Residential, a 260-unit podium-style apartment residence in Scottsdale for Stockdale Capital Partners.

In 2022, McShane Construction Company will be delivering more than 2,400 new apartment homes to the Phoenix market.

MERIT PARTNERS Merit Partners is Arizona’s largest developer of industrial real estate.

With more than 60 years of cumulative experience, it has developed over 25 million square feet. In 2021, Merit Partners completed a number of impressive projects, including a 916,000-square-foot built-tosuit for Mark Anthony Brewing, a 675,000-square-foot build-to-suit for Ball Corporation, a 722,000-squarefoot build-to-suit for RRB Beverage Operations, a 722,000-squarefoot build-to-suit for XPO, and a 268,000-square-foot speculative building at Phoenix Logistics Center.

The company is currently under construction on approximately 3 million square feet of industrial build-to-suit and speculative product.

MORTENSON In 2022, Mortenson will continue to focus on solving complex problems in development and construction for its customers, whether it be front-end

LPC DESERT WEST LPC Desert West is the Southwest arm of Dallas-based Lincoln Property Company and a leader in Arizona office and industrial development, having

MCSHANE CONSTRUCTION 49

50 COMPANIES TO WATCH services, small tenant improvements or complex landmark projects. The firm will build on its many successes of 2021, which include the early delivery of the Hyatt Place Phoenix Downtown, achieving over a year-plus of zero injuries across all projects, and breaking ground on two transformative projects in Tempe: the Arizona State University Multi-Purpose Arena in the Novus Innovation Corridor and the state’s first cross laminated timber office building, The Beam on Farmer, which Mortenson will call home in the new year.

NAI HORIZON For more than 30 years, NAI Horizon has provided the valley with exceptional commercial real estate services, including brokerage and property management. Our agents hold local knowledge and the support of the NAI Global Commercial Real Estate network. The company experienced exponential growth in 2021, with such notable deals as Tempe-based Carvana’s $25M land purchase. Plans are underway for a complete office renovation in 2022 to accommodate growth, creativity and innovation.

OKLAND CONSTRUCTION COMPANY Okland Construction has more than 100 years of experience and offices in Arizona, Idaho and Utah.

In Greater Phoenix, 2021 brought a variety of complex and exciting projects, including Creighton University Health Sciences Campus, HonorHealth Neuroscience Institute, ASU Thunderbird School of Global Management, Legacy Sports Complex and the Phoenix Suns’ Footprint Center modernization. The company also received the 2021 AIA Arizona Goodwin Award for its ASU Durham Hall renovation. 2022 will see work on The Grove at 44th Street and Camelback Road, TSMC F21 office building, Lucid Motors Phase II, Axon headquarters, Paradise Valley Mall redevelopment and Tempe Depot.

ORION ORION Investment Real Estate is a privately held Scottsdalebased full-service brokerage firm 50 | January-February 2022

MORTENSON

that continually outperforms its competition and delivers unprecedented value to it clients.

That client-first approach has led ORION to year-over-year growth since its inception in 2009, including increasing sales more than 250% in 2021. The company looks forward to continued growth in 2022 by expanding its office space by 50%. With unparalleled assistance to its agents, ORION will continue its growth by attracting experienced successful agents with the most supportive, collaborative and fun-loving work environment in the industry.

PHOENIX DESIGN ONE Based in Scottsdale, Phoenix Design One (PDO) is an award-winning interior architecture firm that has been bringing innovative office design to its clients for over 35 years. Every year, PDO completes more than 2.5 million square feet of interior spaces for companies in the medical, retail, education, financial and light industrial sectors. Recent projects include the NovaSource regional office at Chandler Viridian, Eide Bailly office buildout within the Camelback Corridor, Camelback Center lobby and amenity area, The Herb Box in Scottsdale and Press Coffee in Gilbert.

PLAZA COMPANIES Founded in 1982, Plaza Companies is a full-service real estate firm specializing in leasing, management, construction and development. The company enjoyed some key milestones in 2021, including completion of the 183,000-square-foot Creighton University Virginia G. Piper Health Sciences Building at its Park Central development in Phoenix. It also saw continued growth and activity at Park Central, SkySong, The ASU Scottsdale Innovation Center and many other portfolio properties. In 2022, Plaza Companies will continue working on the new development next to State Farm Stadium in partnership with the City of Glendale and the Arizona Cardinals. It will also be building new features at Park Central, including several new restaurants.

PROLOGIS Prologis is the global leader in logistics real estate. Despite the uncertainty of the global pandemic, the firm’s Phoenix team has had an exceptionally strong year. Its portfolio spans 72 properties totaling more than 12.5 million square feet and serves over 150 customers. With vacancy rates at a record low of 4.24%, the Phoenix team has been in active development

50 COMPANIES TO WATCH given the ongoing demand for industrial real estate. In 2021, Prologis completed construction on more than 1 million square feet of warehouse space and expanded its portfolio by 15%. It is also a sustainability leader, with a plan to install 2 million square feet of rooftop solar on its Phoenix properties in 2022.

RISE48 Rise48 Equity, which was founded in 2019 by Zach Haptonstall, Bikran Sandhu and Robert Szewczyk, provides opportunities for investors to protect and grow their wealth by acquiring multifamily apartment properties and strategically add value to the properties. By the end of January 2022, the firm will have completed $715,924,000 of acquisitions in Phoenix, totaling 3,672 units. It also has completed $101,200,000 worth of dispositions, bringing its business plans full cycle. Rise48 ended 2021 with 70 full-time, salaried employees.

RYAN COMPANIES US In 2021, Ryan Companies named Chuck Carefoot president and Rich Montague vice president of construction operations in the Southwest region. In addition, it had

more than 3.2 million square feet of projects under construction, spanning senior living, industrial, office, hospitality and retail. Notable projects completed in 2021 include Friendship Village Phase One, Crosspoint Redevelopment, LivGenerations at Mayo Blvd and Chandler Airport Commerce Park Phase 2. 2022 will be another successful year. The company plans to complete Goodyear Civic Square, JPMC Discovery Remodel, The Confluence at Mesa Gateway and Queen Creek Veterinarian Clinic.

SDB CONTRACTING SDB has more than 40 years of experience performing construction and integrated facility contracting services in the aviation, civil, education, government, healthcare and advanced technology sectors.

Dominic Spagnuolo founded the company in 1980; his daughter Angie Schmidt is the current CEO. In 2021, SDB has completed two important projects: The Emily Center at Phoenix Children’s Hospital, a learning and education center for parents of children who may have a diagnosis they do not understand, and Phoenix College Recording Studio, recognized as one of the best recording studios in Arizona.

STERLING REAL ESTATE PARTNERS Scottsdale-based Sterling Real Estate Partners is a real estate investment company focused on value-add multifamily investments, with an emphasis on Class B and Class C assets. In 2021, Sterling’s investments climbed to more than 400,000 units in high-growth, rent-toown and supply-constrained markets in the western and southwestern U.S. Its latest acquisition in December, the 92-unit multifamily community Mark at 87 in Mesa, brought the company’s investment activity to more than $150 million since 2015.

2022 will see the completion of its first ground-up development in its expanding Arizona portfolio, a 238unit Class A apartment complex in the heart of Avondale.

STEVENS-LEINWEBER CONSTRUCTION Stevens-Leinweber Construction celebrated 40 years of business in 2021.

The ground-up developer and tenant improvement contractor spans millions of square feet and hundreds of highprofile projects annually across Metro Phoenix. Its current pipeline includes major Class A industrial buildings for Georgia Pacific and PepsiCo; multiple ground-up Class A industrial buildings within PV 303; and numerous high-end tenant improvements for leaders such as Tiffany & Bosco, Western Alliance Bank and HonorHealth. Across its history, SLC has completed more than 8,500 projects in Phoenix’s most active submarkets and continues to build its team with an eye toward future growth.

SUNTEC CONCRETE

OKLAND CONSTRUCTION COMPANY

52 | January-February 2022

In 2021, Suntec’s notable work included the Nationwide Realty Campus at Cavasson, The Westin Tempe, UNION at Riverview and the Hyatt Place in Downtown Phoenix.

Suntec’s leadership has remained consistent since 2014 when thenpartner Derek Wright was named president. Wright’s goal is to “build great things,” and investing in his 1,700 employees is paying dividends with the amazing work output and numerous awards. In 2021 alone, Suntec received

SINCE 1918

Creighton University Health Sciences Campus – Phoenix

I.D.E.A Tempe

850 PBC, the first Wexford & ASU innovation building on the Phoenix Biomedical Campus

PROUD ARIZONA CONTRACTOR SINCE 1982.

19 82

www.coreconstruction.com 53

50 COMPANIES TO WATCH four Tilt-Up Achievement awards and worked on some of the region’s best projects, which were honored by NAIOP Arizona.

Properties, W.M Grace and more, and working with known brands such as Amazon, ASML, FedEx, Redbull and Wild Horse Pass Casino.

THE LAND AGENCY

WALTON GLOBAL HOLDINGS

Scottsdale-based The Land Agency, founded by Howard Weinstein, Patty Lafferty and Brad Kuiper in 2017, is a full-service land brokerage firm that exclusively represents landowners, homebuilders, developers, investors, farmers and lenders.

Since its inception, the firm strives to provide its clients with seamless and comprehensive land brokerage service, and over the last 25 years, its principals have brokered tens of thousands of lots and acres. Notable land transactions in 2021 include more than 1,100 acres in Pinal County, over 300 acres in Casa Grande and more than 600 acres in Maricopa.

THE OPUS GROUP The Opus Group is a family of commercial real estate development, construction and design companies with offices and projects across the country, including Arizona. The company’s integrated design-build model has proven results in providing both time and budget efficiencies. In 2021, Opus has developed more than 2 million square feet of projects in the state. Recent developments include the Andersen Windows manufacturing facility in Goodyear; Paradise @ P83, a new luxury apartment community in Peoria; and the Goodyear Airport 85 industrial building.

Headquartered in Scottsdale, Walton Global is a privately-owned land asset management organization with offices across the globe, including Southeast Asia, Canada, Germany and the Middle East. Walton had an active 2021, with many of its land assets now under a sale agreement or purchased for development. The company also added David Peter as executive vice president of special projects and Matt Keister as senior vice president of business development. Heading into 2022, Walton is prepared to develop build-torent communities, in addition to new acquisitions, to meet the high demand for single-family rentals.

WESPAC CONSTRUCTION Celebrating a 30-year milestone in 2021, Wespac Construction is a general contracting and construction management firm. It completed several signature projects in 2021, including a 160-unit, luxury multifamily project, Gramercy Scottsdale; Union at Riverview, a 245,014-square-foot

THE RENAISSANCE COMPANIES Renaissance is Arizona’s gold standard in construction, celebrating 30 years in general contracting providing ground-up, designbuild, design-assist and tenant improvement services in Arizona, California, Nevada, Oregon, Utah and Washington. Through creative problem-solving, precise process and a collaborative partnership approach, Renaissance assists clients in creating their perfect masterpiece. In 2021, Renaissance completed various projects with Barclay Group, Kiernan West, Pizzuti, Merit Partners, Denali National Trust, Toy Barn, Tratt 54 | January-February 2022

WESPAC

high-end office in Mesa; and Cowden Logistics Center, a 285,131-squarefoot industrial facility in Tolleson. The company’s outlook for 2022 is positive, with many exciting projects in the works, including Novus, a three-story office/four-story parking garage on 24.5 acres along Rio Salado Parkway; Smith & Rio Apartments near Tempe Marketplace; a 300,000-plus-squarefoot build-to-suit for Carvana; and Eastline Village, a unique car-free community in Tempe.

WITHEY MORRIS Withey Morris is Arizona’s leading land-use exclusive law firm. In addition to launching its podcast, “Dirt to Development,” a behind-the-scenes look at all the dirt on land use, politics and development in Arizona, the firm is proud of two recent keystone projects. The 3.4 million-square-foot Parkway 303 West, set on 262 acres in Glendale, features six buildings for offices, retail shopping and more. The Central Park is a 15-acre mixed-use high-rise development in Central Phoenix with approximately 760,000 square feet of office space, 170,000 square feet of ground-floor commercial/retail space, and 600 residential units.

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BUILD YOUR FUTURE

CHARTING THE PATH

Build Your Future Arizona connects young adults with construction careers

By KYLE BACKER

F

or all the strangeness of an atypical year, 2021 saw a remarkable trend while the nation still struggled with the pandemic and inflation: people quit their jobs in droves. Dubbed the Great Resignation, this phenomenon meant “Help Wanted” signs became a common sight in storefronts across the country. According to the U.S. Bureau of Labor Statistics, a staggering 4.4 million employees quit their jobs in September 2021, representing 3% of workers. In October, there were 11 million job vacancies.

Some sectors, such as construction, are no stranger to positions going unfilled. Since the Great Recession, the industry has struggled with attracting and retaining workers in every trade.

That was one of the animating drivers behind Build Your Future Arizona

58 | January-February 2022

(BYFAZ), an initiative from the Greater Phoenix Chamber Foundation.

In 2019, the Foundation created a Construction Workforce Collaborative in which several companies came together to focus on how to build a talent pipeline.

“For years, the folks involved with the collaborative had been struggling just having enough entry level talent to replace the workers who are about to retire. Arizona is projected to need 254,830 construction jobs filled through the end of 2024, with 57,000 of those being carpentry positions alone,” explains Paul Sanders, workforce development manager for the Greater Phoenix Chamber Foundation. “These companies sat down and identified the reasons why they were unable to have a steady pipeline of talent.”

He notes that they pinned it down to three basic things: a negative sentiment around the trades, misconceptions about possible career paths and the overall lack of knowledge pertaining to training opportunities.

With the main roadblocks determined, the group looked to the Build Your Future program by the National Center for Construction Education and Research (NCCER) as a model. The organization offered a website template that the collaborative decided to pursue as a platform where people can learn more about construction career paths and earning potential.

With that, BYFAZ was born.

“The primary goal is to get young adults to consider careers in construction,” Sanders says.

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BUILD YOUR FUTURE

Dan Puente

CHANGING PERCEPTIONS For decades, high school counselors focused their career advice on attending a university. While many students can and should pursue a degree, the emphasis on formal postsecondary education made other viable paths an afterthought. In the worst cases, a career in the trades has been used as a foil to encourage students to go to college. The reality is, post-secondary education is often required for skilled trades and several Arizona community colleges, including Maricopa County Community College District are adding skilled trade programs to their course offerings.

Marcia Veidmark, president and CEO of SSC Underground, remembers when higher education institutions began aggressively marketing fouryear degrees to students. She recalls a poster that featured two students standing side by side. One was dressed in the personal protection equipment

60 | January-February 2022

Paul Sanders

Marcia Veidmark

of a construction worker; the other wore a suit and held a briefcase. The advertisement asked, “Which do you want for your child?”

“I remember thinking, ‘Why are you degrading the trades like that?’

I’ve been in Arizona for more than 50 years, so I watched universities successfully market that the best option for your child is a four-year degree, and that’s just not true,” she says. “We should show mutual respect and support for both tracks.

I want good doctors, but high school counselors should talk about the construction trades because we need the hospital to be built, too. Every one of us is critically important.”

Countering this notion takes time and consistent messaging. Dan Puente, founder and CEO of DP Electric, says there is no quick fix. He estimates it could take BYFAZ anywhere from 9 to 12 years to make serious inroads.

“We’re pushing back against

“Folks don’t understand the opportunities available in construction. A lot of people in the industry make six figures, and that’s what Build Your Future Arizona is trying to convey to the public.”

— Dan Puente

60-plus years of a narrative that says you need to go to college to be successful,” Puente notes. “Folks don’t understand the opportunities available in construction. A lot of people in the industry make six figures, and that’s what Build Your Future Arizona is trying to convey to the public.”

Indeed, the trades can be a lucrative vocation. What most people fear, Sanders explains, is that they won’t have any upward mobility. “Just because you start as a welder doesn’t mean that you have to weld your whole life. You could transition to welding design, which would require some additional education,” he says.

Some people may even take a similar path to Puente, who opened his own business. “Through the support of my wife, I started DP Electric in 1990. I wanted to create something in which I could thrive, and others could flourish as well. That’s why we started our own apprenticeship program with more than 100 people enrolled. We don’t overlook anybody.”

Building for the Future Working with the best residential construction trade partners is smart, but getting all the different professions to work together can be complicated. We simplify the process with a family of partners that function as one team. This helps companies reduce cycle time, save on overhead and improve scheduling predictability for a competitive advantage.

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BUILD YOUR FUTURE

Puente adds that there is an effort in Arizona to have a completed apprenticeship recognized as equivalent to an associate degree, which he believes could help reluctant parents see the benefits of the trades.

“That would show that an apprenticeship is an education in a career, in the same way as getting a degree in accounting. It’s about acknowledging the value of the time invested in learning something,” he says.

CAREER FOCUSED One of the primary arenas for BYF Arizona is high schools. Career and technical education have experienced a revival on Arizona campuses, with programs such as skilled trades and automotive mechanics returning to the course catalog. And, unlike the past, they are typically attached to one or more certifications that students can leverage for gainful employment.

Moreover, the Arizona Legislature created career technical education districts (CTEDs) in 1990 to further support trades education. There are 14 of these districts across the state, with Western Maricopa Education Center (West-MEC) and East Valley Institute of Technology (EVIT) covering most of Greater Phoenix.

62 | January-February 2022

“We partner with West-MEC and EVIT to get in front of students and talk firsthand about careers in construction — what they’re like, the demand for them and potential salaries for different positions,” Sanders explains. “We can show them how what they’re learning leads to a career.”

Build Your Future Arizona is also launching an ambassador program in the first quarter of 2022. Sanders say that BYF Arizona is recruiting industry professionals to speak with students in the classroom, at lunch tables and during career fairs.

“We’re trying to enlist folks who have enough experience behind them to show that they’re on a solid career path, but who don’t look like they’re ready to retire. That way, students can see them and think, ‘I don’t have to wait until I’m my parent’s age to earn a six-figure income,’” he notes.

Build Your Future Arizona also targets adults who are interested in a career transition.

“There are more than 20,000 Arizonans who lost their jobs in the food service and hospitality industries because of COVID-19. And yet, those people still need to work,” Sanders says.

If someone is looking to get into construction, Sanders will schedule a

consultation, during which he’ll ask about the individual’s background and work experience to help identify what talents he or she might already possess.

“Are you more interested in the skilled craft side such as carpentry?

Or are you looking at relating your acquired knowledge to support roles relating to construction? I get that feel first, then we get down into what division of construction makes sense,” Sanders explains.

Once a good fit is determined, Sanders takes the applicant’s resume and reaches out to the recruiters at one of the 57 companies that have invested in BYFAZ. “We have a career center with connections to about 400 jobs on it at a time. I try to align the person with the organization I think they would best connect with, since many companies hire for cultural fit,” he continues.

Even though BYF Arizona helps people connect to careers, Puente notes that the initiative is more about awareness.

“We’re building the momentum to make construction a first choice for people. We have to work hard to change the perception for both students and parents,” he concludes. “That’s going to take some time. The industry is finally coming around and getting engaged, but I think we can do more.”

BUILD YOUR FUTURE

Building a Skilled Workforce How one construction firm creates awareness and opportunity through BYFA

By KYLE BACKER

M

ike McCrery, vice president of 3-G Construction, has sawdust in his blood. His father, Larry McCrery, started the family-owned and -operated business in 1974 as a small framing company.

Over the years, 3-G Construction has grown to provide rough and trim carpentry as well as operate Pueblo Lumber Company.

“We’ve built schools, hospitals and more than 100,000 houses in the Valley. With our hardworking team, we’ve been able to have a big part in the growth of Metro Phoenix area,” McCrery says. “When you’re a carpenter, you are a creator. It’s a very satisfying profession. I can drive around town and identify the projects on which I had hammer in hand and created opportunities for people

64 | January-February 2022

who are building families, getting an education or receiving treatment.”

Even though construction careers offer dignified and financially rewarding work, the sector is experiencing a labor shortage. Build Your Future Arizona (BYFAZ) estimates that 254,830 craft professionals are needed in Arizona by December 2024.

That’s why McCrery and 3-G Construction got involved with BYFAZ after being introduced to the initiative three years ago.

“Build Your Future helps the general Arizona population understand more about the construction industry and what it has to offer individuals in terms of employment, career stability and income earning opportunities,” he says.

Over the past few decades, there has been a trend in high schools across

the nation to emphasize attending college as the sole path for students.

While institutions such as WestMEC, the East Valley Institute of Technology and the Pima JTED Career and Technical Education District have promoted the need for greater trades education in Arizona high schools, they are pushing back against a university-centric approach that has been dominating post-secondary planning for a generation.

“There’s still a lot of work to do,” McCrery says. “Too often, our educational system deems the trades as a fallback in case individuals don’t want to become doctors, attorneys or programmers. There are a lot of opportunities to inform educators so they know that construction is more than a backup plan.”

BUILD YOUR FUTURE TALENT PIPELINE There’s no denying that most construction work is, as McCrery describes it, “hot, hard and heavy.” He says that honesty about the nature of the job is crucial in the hiring process, since the cost of onboarding is extensive. The toll on an employee’s body is greater than in retail or restaurant jobs.

However, a clearer career path exists for those in the trades than in many other fields. McCrery argues that the number of workers who climb their way up from laborer to superintendent is far greater than fast food employees who get promoted to management positions.

“The conversion timeframe is so much shorter than other sectors. We can bring in a laborer, and he can be a foreman within two and a half years.

His income could go from $30,000 to $70,000 over that period,” McCrery notes. “There is no other industry out there that you start with no knowledge and can make $70,000 in fewer than three years. We pay to transform someone from unskilled to skilled labor, and whichever company is most proficient at those conversions wins.”

Beyond educating Arizonans about the opportunities available in construction, BYFAZ connects people willing to do the challenging work required to start a career in the field.

When an interested applicant is put in contact with 3-G Construction, McCrery says that he will walk them through the available jobs after the interview.

“We usually let them make the decision, and we find a fit on a crew or in a department that is close to where they live,” he explains. “Then they start their journey in our company.

They go through orientation and safety training, and then their foreman will teach and train them on the job.”

McCrery estimates that 3-G Construction has received about 20 vetted applicants through BYFAZ’s talent pipeline.

SUCCESS STORIES TJ Duncan was hired by 3-G Construction in May 2021 after working in retail for several years.

“I was tired of working part-time at a dead-end job. The money wasn’t 66 | January-February 2022

“The conversion timeframe is so much shorter than other sectors. We can bring in a laborer, and he can be a foreman within two and a half years. His income could go from $30,000 to $70,000 over that period,” — Mike McCrery

right, and things had to change,” Duncan says. “I saw an ad for Build Your Future Arizona on Facebook and decided to give it a try. They set me on the right track and matched me with different jobs based on my interests and location.”

Duncan works in the door shop making bulkheads and shutters that trim carpenters install out in the field.

He enjoys the work he does and the security it brings. “I was able to afford another vehicle so my other half and I could get to work. Our necessities are met versus struggling from paycheck to paycheck,” he says.

Similarly, Warren Begay stumbled upon BYFAZ serendipitously.

After receiving an email about an upcoming workshop on construction

job opportunities, Begay decided to attend with his girlfriend. He enjoyed a building trades class he took in high school but had been working fulltime as a personal shopper for online customers at Walmart.

Today, Begay frames houses for 3-G Construction and finds the process intriguing.

“I like working with my hands and seeing the things I build from beginning to the end. People say, “You should do something you like, and you’ll enjoy every day of it.’ A lot of times, the whole day passes by without me noticing,” he remarks. “I see a future doing this. My foreman says it’s important to learn all the small stuff before I move up, but that I could be where he’s at in a couple of years.”

McCrery agrees that adopting a long-term perspective is key for both new employees and potential investor companies in the BYF Arizona initiative, although he admits he wishes he had more employees coming through the pipeline.

“The investment that we make in Build Your Future Arizona is not just for the 10 new hires over the past two years,” he concludes. “We’re grateful for them, but it’s also about changing the perception and reputation of the construction industry as a whole.”

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Collaborative Advantage Industry organizations are key to spreading awareness

By KYLE BACKER

C

onstruction is a team sport.

The expertise needed to safely and efficiently bring a project across the finish line requires intense coordination between all players in the field. Today, the industry is facing an issue that affects everyone in the business — a labor shortage.

“There’s a much greater awareness that this is not a temporary blip. If we don’t fix it, it could last for quite a long time, especially when you look at the portion of the workforce that is aging out over the next decade,” says Suzanne Kinney, president and CEO of the Arizona Chapter of NAIOP. “Developers are realizing that this is not a one-off problem with a particular contractor. It’s happening to all of them. That’s capturing the attention

68 | January-February 2022

of investors, who are sinking a lot of money into projects and need to start realizing returns within a reasonable and predictable amount of time.”

That’s why NAIOP became a partner of Build Your Future Arizona (BYFAZ), an initiative from Greater Phoenix Chamber Foundation focused on spreading awareness about pathways in the trades and helping people transition into a construction career.

“The whole concept with Build Your Future is to get in front of potential students and individuals and encourage them transition or work in the construction industry,” explains Paul Sanders, workforce development manager for the Greater Phoenix Chamber Foundation. He notes that two groups are integral to the mission

of BYFAZ: investors and partners. The former are companies that make an annual financial commitment between $5,000 and $50,000.

Partners, on the other hand, are organizations that have a vested interest in the construction industry and agree to spread the word about BYFAZ to their members.

“Industry associations such as NAIOP encourage their members to become investors. More people are recognizing that we need to feed and nurture this talent pipeline, or it’s going to hobble everyone,” Sanders says.

BUILDING PARTNERSHIPS For Kinney, she says that NAIOP’s partnership with BYFAZ started after a trusted member reached out

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to her about the initiative. She was immediately interested since the shortage of skilled workers is one of the primary pain points she hears from general and subcontractors.

“But it really doesn’t end there,” she points out. “If the contractors can’t get the skilled workers they need to complete a project, that will result in delays and increased costs for developers and investors as well, who form the largest segment of our membership.”

In June 2021, NAIOP finalized its partnership with BYFAZ. While the initiative does a good job at reaching out to contractors, Kinney notes that she’s able to provide introductions to NAIOP members who are not yet investors.

“Attracting those dollars helps amplify the message. If we’re only reaching a few kids, we’re not going to make much progress in terms of the labor shortage. We need to get into high schools and community colleges, as well as connect with young adults who may have jobs but not careers,” she says.

Tom Dunn, president of Arizona Builders Alliance (ABA), says that his organization’s relationship with BYFAZ gives the initiative access to more than 325 companies that make up ABA and represent a broad range of the industry.

“With our partnership with Build Your Future Arizona, we’re looking to provide pathways to construction careers. These can range from introductory jobs all the way to architects and engineers,” he explains. “It’s a huge swath of people we’re chasing after so they can see what’s available to them.”

Another organization that recently partnered with BYFAZ is Western Electrical Contractors Association (WECA).

In January 2021, the association opened 70 | January-February 2022

Michelle Gilkey

Suzanne Kinney

its first apprenticeship training facility in Phoenix.

“Our founding member contractor in Arizona, Corbins Electric, is involved with Build Your Future Arizona and connected us with them,” says Michelle Gilkey, director of marketing, learning and product for WECA. “We felt an alliance with their mission — this idea of creating a sustainable skilled craft workforce and expanding awareness around training opportunities.

Because we provide a career path with our apprenticeship program, it was a natural match.”

SHARING RESPONSIBILITY The source of the current demand for construction labor, according to Dunn, dates back to 2008 when the Great Recession ravaged the economy. “About one third of our workforce disappeared, and it hasn’t come back. Because of that, combined with the number of Baby Boomers who are retiring, there is huge opportunity in the industry for advancement. Once we can explain this to the younger generation, they can see the possibilities and the pathway to success.”

Kinney notes that there is a chasm present in the market right now. “You have people who aren’t on a sustainable career path, and then there are all these open positions. I think there’s growing recognition that solving this problem is going to fall on employers and schools and, of course, there’s always individual responsibility,” she says.

“But we can’t leave it to individuals to figure it out on their own. People need the information and resources to understand what they must do to gain the necessary skills.”

Paul Sanders

The apprenticeship program offered through WECA is one example of how BYFAZ connects Arizonans with careers. Gilkey explains that if someone shows interest in becoming an electrician, he or she would likely be funneled to WECA. “What’s great about apprenticeships versus the community college route or a different electrical training program is that apprentices get their tuition completely paid for by their member contractor,” she says. “Throughout the four-year program, they’re also earning full-time pay.”

Sanders adds that part of BYFAZ’s messaging is helping students and parents understand that an apprenticeship is an education akin to going to college but with some distinct advantages.

“If a young person starts an apprenticeship at the same time his or her friend starts going to Arizona State University, studies show that the person in the skilled craft will be making $5,000 more in the job they currently have compared with what the friend with the four-year degree will be making in a first job out of college. Plus, the apprentice is debt-free,” he says.

Ultimately, getting the message out will take time. Kinney notes that most people need to see an advertisement seven times before it registers with them.

“It’s important for us to continue amplifying this message through multiple channels and make sure that the target audience is going to receive the message in a way that resonates with them,” she concludes. “That’s how we connect with the people who will benefit from these careers and help everyone involved in the industry as a result.”

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MURAL MAGIC The ULI2D project leverages public art to create healthier, happier communities

T

he area surrounding Guerrero Rotary Park in Mesa has a long and storied history. Since the early 1900s, the neighborhood has been home to a large Mexican American population that brought its culture and traditions to the region. The area counts among its famous residents Rosaura and Pedro W. Guerrero, founders of Rosarita Mexican food products, as well as their son Pedro E. Guerrero, the renowned photographer best known for his work with Frank Lloyd Wright. To this day, the park and neighborhood bear the family name.

Over the years, policies that diverted investment away from minority neighborhoods created economic disparities in areas such as Guerrero Park, and the eponymous park, a centerpiece of the community, was no longer filled

74 | January-February 2022

By REBECCA L. RHOADES

with happy children because of increased criminal activity and people experiencing homelessness. The neighborhood grew from its rich cultural roots and was also a popular spot for street art. Faded paintings that showcased the tight-knit community’s Hispanic roots covered walls and spoke of a collective history and bond that had connected neighbors for more than a century.

“There are neighborhoods that some people say are going downhill and need revitalization and love, when the reality is that they already have an authentic sense of place and a lot of core community uses,” explains Trevor Barger, CEO of Espiritu Loci and principal at Arizona Strategies.

“There’s usually a great church, a community center of some sort, a school

— and none of those are failing. The community is pretty well connected. The people may be internally focused, but they know who each other are and what their past has been, and most of them have lived in the area for quite a while.

These aren’t areas that need to be torn down and rebuilt. They’re areas that already have strong connections but oftentimes don’t have a way to express in physical form what has been created.”

The Guerrero Park neighborhood is one such example. In a unique collaborative partnership with the community and the City of Mesa, ULI Arizona’s community mural project, known as ULI2D and chaired by Barger, married the talents of ULI and local artists with a master-planned public art installation.

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ULI’s mission is to shape the built environment for transformative impact in communities, and a key focus area is creative placemaking/ keeping, leveraging art and creativity to strengthen spaces and places.

“When you talk about social indicators of public health, one is the walkable distance from your home to a park,” says Mesa Mayor John Giles. “But having a park that is a walkable distance to your house that you never walk to doesn’t work, does it? This project in Guerrero Park is important. It created vibrant places that residents walk to and enjoy, where they have social interaction with their neighbors, and where kids play and get in some exercise because the park is a much more interesting experience.”

He adds, “If you drive by the park today, the vibe is different and the environment is healthier than it was before.”

But convening a public art project requires more than simply putting paint brushes to walls.

Patrice Marcolla, vice chair of the ULI2D committee, explains. “There’s a level of trust and credibility that needs to be built,” she says. “When you look at a neighborhood from the outside, you don’t really know or understand it’s history. We want to develop a true understanding, and that only comes with time and engagement.”

The team spent months working with community members and neighborhood 76 | January-February 2022

leaders, going door to door and listening to what residents were proud of, what they aspired to and what they wanted, and gathering input for where murals would showcase character and connection.

“We wanted the artists to tell the story of the neighborhood,” says artist Hugo Medina, who worked with ULI from the project’s earliest stages and helped select the participating muralists. “We organized a community storytelling day so that residents could share their stories with the artists. The artists also met with the people whose properties were utilized for the project.

A huge part of selecting the artists was determining who would work best with the different walls as well as the individuals and groups.”

More than a dozen murals now weave through the neighborhood, beginning at the entrance to Guerrero Rotary Park and flowing throughout nearby streets.

They tell stories of hope and redemption, of cultural traditions and community leaders long gone. There’s Gina Ribuado’s and Meghan Elaine Mitchell’s vibrant portrait of a Spanish woman, framed in brilliant shades of yellow, red and turquoise and flanked by Sonoran landscapes. A verdant lovebird perches on one hand, while a Gila monster rests on the opposite side. Medina, Augie Gastelum and Chris Vena’s mural speaks of childhood joy through silhouettes of kids playing. Lucinda “La Morena”

Hinojos’ wall showcases hummingbirds, butterflies and sunflowers. In the center, a person holds a sign that says, “We don’t know each other, but we need each other.” Then there’s Darrin ArmijoWardle Ofrendas’ Catholic-themed artwork, which features Day of the Dead skulls, Our Lady of Guadalupe and a portrait of the pope. “It’s just this stunning piece that everybody points out as the drive through the neighborhood,” Barger says. “The way he was able to capture light and movement inspires a lot of conversation.”

“Azteca Pride” by David R. Martinez is located at the corner of 8th Avenue and South MacDonald. The mural was painted more than 30 years ago in response to a young girl who was hit by a car at that corner. The team members of ULI2D sought out Martinez, who not only refreshed his original work of art but also expanded it by adding panels of brightly colored Aztec scenes to each side.

The centerpiece of the entire project is a 450-foot-long mural that runs along the park’s western edge. On Nov. 9, 2019, 16 artists and more than 300 community members came out and worked side-by-side to paint the block wall in colorful scenes that reflect the heritage, natural surroundings and people of the area. Medina created a panel that can be seen from the parking lot. “My idea was basically to have hands open and a person blowing

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Trevor Barger

Mayor John Giles

butterflies that represent the larger community and spread throughout all the park murals,” he explains. Nearby, another panel pays homage to the park’s namesakes Rosaura and Pedro, painted by renowned local artist and the couple’s nephew, Zarco Guerrero.

“The park was full of people, which was really fun to see,” says Giles of the community paint day. “What is especially rewarding is the fact that it was a great example of people from outside the community coming in and facilitating things, providing the paint and resources for the artists, who were wonderful. But the actual subject matter — the stories that are reflected in the art — comes 100% from the community.”

Marcolla recalls, “That paint day was an important source of community engagement. It’s where we heard stories about the children who grew up in the area and all of the different neighborhood aspects that influence the artwork.

“Instilling pride in a community also helps increase safety,” she continues.

“There’s a desire to maintain the park because there is real connection. It’s a part of the culture and a place where kids can hang out.”

78 | January-February 2022

Steve Lindley

Patrice Marcolla

Studies have shown that arts help foster a healthy, equitable community.

“Color is known as a huge component for adding vibrancy, but it also speaks to the destination,” Medina explains.

“Murals have always had a positive effect in communities.” The more art that reflects the neighborhood, that’s done by neighbors and for neighbors, the less apt it is to be defaced by graffiti and vandalism.

Now that the project is complete, one of Barger’s favorite things to do is go back and check on the murals. “There’s now a bench by the community mural, and there’s usually someone sitting there. They see me taking photos of the murals, and they want to tell me the story of how it all happened,” he says.

“These are their murals, and they’re very proud to share about them.”

Scarlett Flores’ family has been part of the Guerrero Park neighborhood for decades. She got involved with the ULI2D project after muralist Gastelum spotted her painting her van. During the community paint day, she helped little kids paint, teaching them how to be more creative. “I got to meet so many neighbors who came out to paint. There

Hugo Medina

were people passing by and exchanging numbers. It really brought us together as a community,” Flores recalls.

Steve Lindley, executive director with Cushman & Wakefield and treasurer of ULI Arizona, says, “Our goal — and hopefully this happened — is that the people who live and visit there feel more connected with pride and renewed spirit because of this project.”

According to Flores, the murals celebrate the neighborhood’s culture.

“That’s what we love. Our culture is being heard and in plain sight,” she says. “The park is the heart of our little community.”

ULI is working with the City of Phoenix to finalize a second mural location in downtown Phoenix. It’s also documenting its mural art efforts to share transferable ideas with other municipalities and neighborhoods.

Marcolla sums up the results of the Guerrero Park project: “There’s something really beautiful about when a neighborhood has artwork that is by the community of the community.”

For additional ULI2D information, maps and images, visit arizona.uli.org/ get-involved/uli2d-community-muralproject/.”

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DESTINED FOR SUCCESS A unique real-world internship introduces disadvantaged and underserved students to the power of real estate ownership

By REBECCA L. RHOADES

A

s a freshman majoring in finance at Arizona State University, Tolleson native Alexis Barber didn’t know much about commercial real estate. So when she was presented with the chance to participate in a unique internship that merges both fields, training students not just about real estate but also about how to build wealth through it, she jumped at the opportunity.

The eight-week virtual program, known as Project Destined, provides real-world internships for historically disenfranchised people, including women and people of color. Students work with executives in the commercial real estate industry, with a focus on the multifamily sector, researching deals, evaluating properties, learning marketing and strategy analyses, and developing valuation and deal financing.

“During the pandemic, I was reading a lot of finance books and had started getting interested in real estate,” Barber

80 | January-February 2022

recalls. “After going through the program, I learned that there’s so much more to it, and it interested me even more.”

Founded in 2016, Project Destined is the brainchild of Washington, D.C.-based former investment banker Cedric Bobo. “I’m from Mississippi, and I had a great-grandfather who bought hundreds of acres of land and built a series of agricultural businesses. I wanted to be an owner just like him, but I had no idea how to do it,” Bobo says. “That’s what bonds me to students like Alexis. We have the desire to be owners in our neighborhood and the conviction that we have the skills to do it, but we have no clear path.”

A stint at Harvard Business School, a year abroad studying at Oxford University and jobs at investment firm Salomon Brothers and private equity company The Carlyle Group opened Bobo’s eyes to using investor funds to finance building purchases, and he began his foray into real estate by buying tiny apartments in London.

After leaving The Carlyle Group, Bobo and his wife continued to invest, “because we had seen how to produce wealth and impact neighborhoods,” he says. It was during this time that Bobo began questioning why schools, which often emphasize STEM classes as the pathway to a better future, don’t teach students how to become owners through real estate.

It was during a business trip to Detroit that Bobo got the idea to start Project Destined. “There was

a lot of capital in Detroit going into development, much like there is in Phoenix today,” he says. “There was also a huge diverse population in Detroit, with very few diverse owners.”

Bobo partnered with the mayor’s office and selected 15 high school students to put through the program.

The students were paid a stipend to learn about real estate; in return, they would analyze live deals, apply their learnings to the deal and pitch it to Bobo and his wife. The couple ended up purchasing two of the buildings.

The program was a success and garnered plenty of media attention.

Bobo soon began expanding Project Destined to such cities as Memphis and Miami. Today, more than 500 students nationwide have participated in the program, which is now offered in numerous states and even some international markets. “The goal is to have a global community in which students are simultaneously learning how to become owners and then getting jobs in the real estate field,” he says.

“The first piece of being successful is knowing you deserve to be successful,” Bobo continues. “We tell our students, ‘You’re going to be successful at Project Destined, and we’re going to teach you how to become an owner.’ We’re trying to train with a mentality around ownership. And the same mentality that supports buying a home can support buying a 10-unit building.

And a 10-unit building is not different than a 100-unit building. But it all

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Alexis Barber

Joe Blackbourn

starts with the mindset of, ‘I deserve to become an owner.’”

Gary Linhart, owner of WestHawk Capital, brought Project Destined to the attention of ULI Arizona after first hearing about it during an industry Zoom call. “ULI has a significant equity, diversity and inclusion initiative, and here was this organization that was taking action to help people in underserved communities or demographics get into the commercial real estate industry,” he recalls. “Cedric and his team were cracking the code on how to diversify the industry, so it made sense for us to collaborate with ULI to facilitate the program in Arizona.”

The cost to participate is $25,000 per team; a ULI Arizona team was created in the fall and a second ULI team will participate in the spring. Teams can be sponsored by a single firm or, as was the case in Phoenix, multiple ULI members.

Each team comprises 10 students — eight students and two student program managers who have already been through the internship — and four to six mentors. The students are given a live deal to analyze, and every two weeks they must present their project in “Shark Tank”-style competitions against other teams around the country and defend their decisions — “This is how we’re making it better.” “This is why you should invest in our project.”

Joe Blackbourn, president and CEO of Everest Holdings, worked with Linhart on developing Arizona’s first Project Destined team. “Cedric has been able to bring industry veterans in major markets across the country together with kids who are still in school.

There are real relationships and real jobs coming out of this program. The students are getting hired as interns and then, ultimately, as full-time employees 82 | January-February 2022

Cedric Bobo

Gary Linhart

by companies that previously hadn’t been able to tap into this kind of talent.”

Linhart adds, “The goal is to eventually have a lot of future owners and investors from minority and underserved communities.”

The Arizona team, which comprised students from Arizona State University

Donor Spotlight The following ULI and community members helped sponsor the first ULI Arizona Project Destined team. Some donations may have come though charitable foundations and trusts.

Jerryd Bayless entrepreneur/NBA star Chapin Bell CEO, P.B. Bell Joe Blackbourn president and CEO, Everest Holdings Daryl Burton president, Reliance Management Darius Green co-founder, Keyser Gary Linhart owner, WestHawk Capital Elliott Pollack founder, Elliott D. Pollack & Company Byron Sarhangian partner, Snell & WIlmer Stanton Shafer COO, Holualoa Josh Simon founder and CEO, SimonCRE Greg Vogel CEO, Land Advisors Organization

Stanton Shafer

and one student from the University of Arizona, worked on a deal for an 18-unit apartment complex located across the street from Grand Canyon University and valued in the $2 million to $4 million range.

“The most interesting thing was to see the amount of progress that was made from beginning to end just in terms of the students’ understanding of the vernacular and some of the basic mathematic concepts,” Linhart says. “Project Destined is a really good format for giving someone exposure to the business to see if they’re genuinely interested. In most cases, people are pretty excited about it and want to continue.”

Stanton Shafer, COO of Holualoa, served as a mentor for the 2021 Arizona team. “Project Destined is a wonderful program that’s very well-organized and thought-out,” he says. “I was impressed by how well the students grasped the concepts, and they put together a presentation that was really amazing.”

Barber particularly enjoyed creating the value-add plan. “I liked doing the research, looking at the property and deciding what we wanted to upgrade to make it more beneficial for college students, and how we would market the completed development,” she says.

Following the completion of her internship, Barber was hired on

by Project Destined as a regional production director. She now helps market to and acquire new interns.

“It’s great that I got hired onto the team. Cedric has so many connections that he’s able to help if I decide that I want to work another internship in commercial real estate,” Barber notes.

“Project Destined has definitely given me a leg up in the industry and opened a lot of doors.”

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THE MISSING MIDDLE ULI’s Housing, Health and Equity Task Force examines Arizona’s need for workforce housing

By REBECCA L. RHOADES

H

ousing and health are inextricably connected. Quality, affordable housing is about more than shelter; it’s about a sense of community, the security that comes with having a stable place to live and the opportunity for self-advancement.

It’s about physical, mental and emotional well-being. Without access to an affordable home, achieving an optimal quality of life is impossible.

“Most people associate healthcare with medicine and doctors, but it’s much broader than that, because housing is so elemental to our health,” says C.J. Hager, former director of Healthy Communities for Vitalyst Health Foundation, a Phoenix-based nonprofit that works to improve the health of individuals and communities throughout Arizona.

“The built environment is a substantial contributor to our health, and how we interact with the built environment and the social elements associated with it have huge and often unrecognized impacts on health outcomes.”

Beginning in August 2020, memberled task forces organized by ULI district councils in Chicago, Phoenix, Sacramento and Tampa worked to address local policy and regulatory barriers to creation of healthier and more equitable places. These initiatives were part of ULI’s District Council Task Forces for Health and Social Equity Project, led by ULI’s Building Healthy Places Initiative with support from the Robert Wood Johnson Foundation.

ULI Arizona teamed with Vitalyst to create the Housing, Health and Equity Task Force to lead discussions and research into housing affordability challenges facing Metro Phoenix. “We

84 | January-February 2022

C.J. Hager

need to have healthier communities,” Hager notes. “But often there are no tangible recommendations about how to achieve that with respect to housing.” The task force focused on identifying housing inequalities and addressing possible solutions and ways the real estate industry and partners can step in to meet these needs.

Fewer than 24% of homes in the Phoenix-Mesa-Scottsdale metropolitan statistical area are affordable to a four-person family earning 80% of the AMI; only 40% are available to those earning 120% — ULI Terwilliger Center 2021 Home Attainability Index According to the resulting report, “Advancing Health and Equity through Workforce Housing,” Metro Phoenix used to be one of the most affordable regions in the country, but rising land costs, stagnant wages and an influx of new residents competing for places to live have contributed to decreasing housing affordability.

Workforce housing is considered attainable for families earning 60% to 120% of the area median income (AMI).

Maria Laughner

Silvia Urrutia

For fiscal year 2020-2021, the AMI for a family of four in Greater Phoenix was $77,800. Housing for those making less than 60% AMI is considered lowincome/subsidized, while greater than 120% is considered market rate.

“Workforce housing is generally for middle-income earners and supports our teachers, firefighters, bank tellers, essential service providers, police and emergency medical technicians,” says Maria Laughner, economic development program manager for the City of Tempe.

Hagar adds, “The folks who are working but who are having a hard time finding housing that fits into their budgets typically end up being workers with lower to moderate incomes, and especially people of color.”

Interactive data in the ULI Terwilliger Center 2021 Home Attainability Index shows that fewer than 24% of homes in the Phoenix-Mesa-Scottsdale metropolitan statistical area (MSA) are affordable to a four-person family earning 80% of the AMI; only 40% are available to those earning 120%. The MSA also ranks among regions with worse-than-median affordability.

“The whole Valley is in crisis,” Laughner points out. Workforce housing, in particular, is in diminishing supply.

“There are far more people looking to buy or rent than there are units available, especially affordable to middle income levels,” she notes.

Also highlighted in The Workforce Housing report is a sobering Robert

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ULI CASE STUDY: TEMPE MICRO ESTATES According to the ULI Terwilliger Center for Housing, households in the 60th income percentile of middle income ($30,000-$75,000 per year) are spending more than half of their income on housing. Many of these families who are being priced out of the rental market can afford a mortgage, but competition for available housing is fierce.

One unique project, the first of its kind in the region, aims to provide affordable workplace housing on community-owned land.

Developed in partnership with the City of Tempe by nonprofit land trust Newtown Community Development Corporation, Tempe Micro Estates comprises 13 600-square-foot one-bedroom homes that will be sold to people who earn 80% of the area median income (AMI).

The contemporary two-story structures, designed by coLAB studio and built by 180 Degrees, cost $170,000, with a down-payment of $5,500, for those earning 80% or less; the price increases for those earning between 80% and 120%. Those who make more than 120% are ineligible to purchase into the community.

Because the properties are on a land trust and salaries are

Woods Johnson Foundation statistic: People in resource rich, more expensive zip codes typically live longer than residents in underserved, underresourced areas. In fact, life expectancy in the Valley can vary by up to 14 years depending on where you live.

In Tempe, growing demand outstrips consistent inventory and high-end multifamily products are experiencing a development boom. To help boost housing for all income levels, the city passed the Affordable Housing Strategy in July 2019. “Tempe was early to the table in this conversation. It had already decided what kind of initiatives it would offer developers if they provided some affordability,” explains Silvia Urrutia, founder and CEO of U Developing and Task Force co-chair with Hager.

While federal and state subsidies, such as the Low-Income Housing Tax Credits, are available to fill financing gaps, the same gap financing is limited when it comes to workforce housing.

As such, Tempe has taken a unique approach to raise additional funding.

One year ago, the Tempe City Council approved the Home Town for All initiative. For every project built in Tempe, 50% of certain permitting fees paid to the city are directed to the Tempe Coalition for Affordable Housing.

The money is used to buy and renovate properties or purchase land and request offers from developers to build workforce housing. To date, the initiative has raised 86 | January-February 2022

capped, if the homeowner decides to move, he or she must sell the residence back to Newtown CDC. “We don’t believe it’s the homeowner’s responsibility to figure out if the buyer is under 80% AMI,” explains Stephanie Brewer, executive director for Newtown CDC. “We buy the house off the market, we sell it to the next individual, and we keep ownership of the land. That way we can keep the costs down in perpetuity.”

more than $6 million and created 100 affordable units. “We’re making strides, but it’s a drop in the bucket when you think of how many people are in need of homes,” Laughner says.

She continues, “One of the things we’re seeing in Tempe is the impact of having people who can’t afford to live where they work. There are more workers in Tempe than there are residents. The in-migration of workers puts a significant strain on transportation and transit infrastructure.”

So what can municipalities do to strengthen workforce housing efforts?

Hager notes that land is one of the biggest costs in housing development.

“There are some tools that are routinely used to help mitigate land costs,” she explains. “One is a land bank, which acquires land for future development, and the other is a community land trust, which is a form of shared equity homeownership. A nonprofit community based organization acquires land and maintains ownership of the land in perpetuity for the benefit of the community. There are several community land trusts in Arizona, such as Newtown Community Development Corporation, and they are doing some really great things that should be scaled and expanded.” See Case Study (above) for one example that recently completed construction in Tempe.

Planning, zoning, financing, partnerships and sustainable design

also offer viable solutions. “If we really want to accelerate the development of affordable housing, we need to step into the flexibility of the planning and regulation tools at hand,” Hager continues. This includes removing barriers and creating new zoning incentives; encouraging the efficient and creative use of land and partnerships; leveraging public and private financing sources to fill in gaps to make projects feasible at lower price points; building more missing middle, gentle density designs, such as row townhouses, bungalows and multiplexes; allowing accessory dwelling units in more residential districts, and establishing standards for prefabricated building and construction elements.

First and foremost, though, is making housing affordability a priority and developing comprehensive strategies that coordinate action among all the partners working on healthy, equitable housing opportunities.

“Housing inequities that exist in neighborhoods have direct links to other social needs in terms of healthcare, employment, transportation and educational achievement,” Laughner concludes.

“And that affects us all.”

For more information and to download “Advancing Health and Equity through Workforce Housing,” visit arizona.uli.org/get-involved/ housing-health-equity-task-force.

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