AZRE & Valley Partnership - Special Section by AZ Big Media

Celebrating 25 Years of Responsible Development

2012 Special Section: Presidentâ&#x20AC;&#x2122;s Letter 44 Past Chairmen Roundtable 46 2012 Chairman Q&A 60 25 Years of Leadership 62 Partner Profiles 68 Community Project 71

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CONGRATULATIONS TO VALLEY PARTNERSHIP ON 25 YEARS OF LEADERSHIP AND SUCCESS IN ADVOCATING FOR RESPONSIBLE DEVELOPMENT.

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VALLEY PARTNERSHIP: PRESIDENT’S MESSAGE

25 Years of Commitment

eginning at the end of 2011, I was charged with the responsibility of reviewing the 25-year history of Valley Partnership in anticipation of the yearlong celebration of our Silver Anniversary. The only records kept by a small organization with a historically small staff were the binders of corporate minutes (required by law) and some photographs — not pictures on websites, CDs, JPEGs or TIFFs — of events and Community Projects. I dreaded the thought of combing through tedious legalese and staged pictures of people holding shovels pretending to do heavy lifting at some children’s facility one day a year. I was wrong. Reading the corporate minutes from 1987 through 2011, each year came alive with the personalities of the Chairs of the Board of Valley Partnership. They were business people who led the organization and the commercial real estate industry in some of the direst times and in some of the most successful. I read of the dedication of the Partners who served on Valley Partnership committees with missions ranging from Government Advocacy to Business Development to our Community Projects. Although 25 years have passed and the Valley has grown beyond the boundaries that existed in 1987, one thing has been consistent: Valley Partnership is a partnership among strong individuals who are dedicated to the four corners of the Valley Partnership Mission: Advocacy Education Networking Community Service I hope you enjoy this look back over the past 25 years, particularly the comments of the past Chairs of the Board of Directors, a collection of prestigious commercial real estate professionals who committed a significant amount of their career and time to Valley Partnership. I invite you to join Valley Partnership for the next 25 years and become a part of the Valley of the Sun’s Premier Advocacy Group for Responsible Development.

Richard R. Hubbard President & CEO Valley Partnership 44 | May-June 2012

Congratulations to

Valley Partnership on their 25th Anniversary!

Vestar is honored to have been a part of Valley Partnershipâ&#x20AC;&#x2122;s leadership for more than 20 years.

Lee Hanley Pat McGinley Rick Hearn 1987-1995

ACQUISITIONS

MANAGEMENT

DEVELOPMENT

2425 East Camelback Road, Suite 750 | Phoenix, Arizona 85016 602.866.0900 | www.vestar.com PHOENIX

LOS ANGELES

SAN DIEGO

LAS

VEGAS

1999-2003

2006-2012

VALLEY PARTNERSHIP: ROUNDTABLE BY PETER MADRID · PHOTOGRAPHY BY CORY BERGQUIST

Back to the Future

alley Partnership is celebrating 25 years as Metro Phoenix’s premier advocacy group for responsible development. In looking back – and also looking ahead – AZRE magazine brought together six former chairmen to discuss goals the group has successfully achieved and challenges that lie ahead. 46 | May-June 2012

Six past chairmen reminisce about the past, discuss what lies ahead for Metro Phoenix development

Past and present: (L to R) Valley Partnership chairman Rick Hearn and past chairs John Graham, Pete Bolton, Clesson Hill, Dave Scholl, Charley Freericks and Jim Pederson.

1997 and 1998; Jim Pederson (JP), The Pederson Group, chairman in 1999; Pete Bolton (PB), CBRE/Grubb & Ellis (Newmark Grubb Knight Frank), chairman in 2004; and Charley Freericks (CF), DMB Associates, chairman in 2006. Rick Hearn (RH) of Vestar, the current chairman, served as moderator.

: During the past 25 years, has the level of economic development undertaken by local governments and the state been inadequate, adequate or exceptional?

With the commercial real estate industry making a slow recovery from the Great Recession, the advocacy role undertaken by a group such as Valley Partnership is magnified. “The surge in commercial real estate is evident,” says Richard Hubbard, president and CEO of Valley Partnership. “The comments from our past chairs provide great direction to Valley Partnership for the next several years. “With the increasing activity, it is imperative we re-energize our advocacy efforts with particular focus on the local communities while always monitoring our state and federal governments for any issue that affects our industry.” Participating were John Graham (JG), Sunbelt Holdings, chairman in 1989; Dave Scholl (DS), Westcor-Vintage Partners, chairman in 1990; Clesson Hill (CH), Grayhawk Development, chairman in

: Frankly it’s all three. Over the years, it’s been inadequate, and it’s gone to adequate, and then I think in some cases it’s been exceptional. It also depends on which state we compare ourselves with because some states are exceptional and then some states are just barely adequate. And then you can go in the opposite direction, say inadequate, compared to Texas, and some of the other big ones across the country. Overall, we are doing a better job today.

: I would agree. I think there is lack of funding these days and I think that education has suffered greatly and that is a major infrastructure that needs to be rebuilt. Not just here but everywhere, and as we move forward and embrace new technology, it is a new way of life as we look toward the future.

: When I looked at this question, I really focused on the side of economic development and “are cities making investments?” I 47

VALLEY PARTNERSHIP: ROUNDTABLE think that a lot of ways the cities have been trying to operate with their arm tied behind their backs. The constitution and our legislators have never really given our local government a whole lot of choices in their tool boxes. With the limited tools they have in there, they have done a pretty good job. I think that the industry I have been in has had a lot of city participation in economic development, and I think that they have been pretty aggressive about getting the most out of what limited tools the state’s constitutional statues have given.

: Charley, your company was impacted by this exact thing oat Eastmark (in Mesa) in regard to Apple. What are your thoughts?

: Well it was not just Apple. It happened to us positively with First Solar. We were able to compete and win there. And with Apple, to be in the mix, I’m where Pete was. It is an evolution where economic development has come a long way since 1987. I had to think about 25 years, and I didn’t know I had been in the business that long. I look at what has happened now as the communication level of real prospects is very high and people know they’re coming and looking, which in the old days you would hear about it and it was here and gone. I’ve been in that side of the business almost my entire career chasing prospects from out of state. We come in second place to states that want to write checks. When we lose, we lose because somebody wrote a check and throws money at it to the prospect. I’ve never been a huge advocate at writing big checks. It’s a

48 | May-June 2012

complicated business. I think we are doing a lot better chasing these deals and being in the running and again the tool kit is very limited.

: I’m actually optimistic about many things and this is actually one of them. My view is that being a young state one of the things that we did probably an amateurish job in early on was in economic development. I think that was a maturity problem not a “we didn’t quite get it problem.” With what we have now with GPEC and ACA and trying to address some of our structural and political and legislative problems, we got a really good pipeline of stuff that is being looked at and is being professionally handled.

: Certainly economic development depends on how you define it. A lot of people think that dangling a check in front of a major company is going to bring jobs into the state. But as Clesson mentioned, it’s more than that. It is infrastructure investment; it’s education and venture capital.

RH JP

: Has Valley Partnership had a positive effect of creating a better image for developers?

: There is a word that has been overused but I think that it is applicable. In this case, that is sustainability — the sustainability of our communities. It directly relates to our industry because we plunk down projects, neighborhoods or communities, and we depend upon a standard of living that is directly dependent on the rents that we get for our properties. During recession times,

neighborhood. Looking at the various infrastructure investments that are critical to the kinds of things we do. We manufacture a product. And to manufacture the product, you need certain things, at least in the shopping center business. You need good tools. You need quality neighborhoods. You need good infrastructure investments. All of those things that directly relate to the level of rents we are going to get. In that regard I think Valley Partnership over the past 20 years has been excellent. I think it’s an organization that has emphasized the sustainability concept.

John Graham and Charlie Freericks construction prices go down, land prices go down, but you have to achieve the rents if you are going to be successful at the end of the day. What Valley Partnership has done, by emphasizing how development relates to a sustainable lifestyle in the various communities where we live, is to look more beyond the block of where you are developing. It’s looking at your community, looking at your

: I think the short answer is yes, that is has improved the reputation of how people view the development industry. The other part of that is the role that Valley Partnership will never go away because inherently we are in a confl ict relationship with neighborhoods and other people. No matter how good of a job we did, it’s always going to be viewed that way. I think we have changed the conversation from one that was always in essence an adversarial, to at least everyone understanding that it is a two- or three-legged stool at a minimum, and that things have to be done by more than consensus. It has to be more by partnership and good conversation. That is why Valley Partnership will always have a role to the extent of how we want to have it because no matter how good a job we do, we will have different rubs with different constituency groups. But I think the role we need to continue to take is being the group that is not adversarial, rather constructive in those conversations for solutions.

VALLEY PARTNERSHIP: ROUNDTABLE

: I was more optimistic on this one. My immediate reaction was absolutely that my focus was on the government. As an industry dealing with all of the city, town and county issues for regulations of our industries locally, I think Valley Partnership’s reputation really had a big impact because we have rational and moderate voices coming through consistently saying, “Gee, your regulation here is either irresponsible or maybe needs a little tune-up or maybe you missed a big idea here.” So from the professionals within our industry that we deal with, staff level government in particular, I think our reputation over the past 20 years has improved radically. I’m with the other guys here. The challenge we face will always be in confl ict with residents and neighborhoods, and we need to keep doing our jobs well to keep doing that and not be controversial.

come up and a local municipality would ask, “Can you guys put something together on this billboard issue?”, and we would have six very educated voices at the table later that afternoon. That just doesn’t happen in any other organization. From my side of the business (brokerage), that has been extremely positive. As soon as we get the local municipalities on board, which they are, the neighborhoods rarely follow, but they don’t have much depth of voice anymore because if the politicos are truly believing the intelligent voices of the marketplace, they have a tendency to be more objective.

: I think part of the sustainability of 25 years of leadership is that Valley Partnership has been able to maintain frontline guys and women who are involved in development and kept them passionate about Valley Partnership. It has never faded away or lost its image in the cities to know that if we come, we will get quality people stepping up and get engaged and deliver some kind of end product. I think it’s a tribute to the leadership inside Valley Partnership to maintain that constant level of quality people.

: We asked this question more than 20 years ago: Do you feel the local and state government officials have a good understanding of the current real estate and banking problems in Arizona? Can that same question be asked today?

Rick Hearn

: I agree. I think that whenever you look at an image, you have to talk about which audience you are talking about. I think among consumers or neighborhood groups and homeowners, I don’t know if they have enough regular engagement to really understand who Valley Partnership is. I don’t know if the developers’ image among the average fellow on the street has improved that much. I agree with Charley. I think we are front of mind when a city or a local government says, “We need input, or we are thinking about changing this part of our code.” I think we are one of the first people they think of to come to the table and have the dialogue; whereas before Valley Partnership, it was a very splintered industry, and I don’t think there was a common voice and more importantly a common set of ears that listened to cities when they needed have that dialogue, too. So I think it has been vastly improved.

: What Valley Partnership has really accomplished with the local municipalities is to provide them with a dependable, educated voice. I remember sitting on a board and something would

50 | May-June 2012

: I think they understand it because it is affecting their revenue significantly. Development to cities is a mixed blessing. They appreciate all of the sales taxes and the fees paid by the developers, but they have to contend with all of the complaints. Charley made an interesting point dealing with cities. Sometimes what I call the newer cities, the ones on the outskirts, don’t have the staff, the continuity or the maturity that some of the older cities have, so it’s sometimes more difficult to deal with the smaller cities. But most governments are strapped right now. That’s due to the economy and a city that is accustomed to the fees and the taxes that are derived from development. I don’t think we are ever going to have the kind of economy we did between 1994 and 2006-2007. We all have to make adjustments. Our industry has to make adjustments in terms of what we do and how we do it. We have a product to produce. Cities are going to have to make adjustments. Should cities be totally sales tax dependent? Shopping centers produce a lot of sales tax, and they welcome us with open arms. Car dealerships produce a lot of sales taxes. Shouldn’t we have a more level playing field in regards to tax generation? Just because Scottsdale has more commercial than an adjoining city, does that mean that they are going to have more revenue to support their services? I think that it is a global approach, and our cities are going to come together and address some of those concerns.

: I don’t think there is any question that they understand the depth of our problems. It’s all the way from their fiscal problems to the operational issues of not seeing zoning cases and their staff being cut down to skeleton-type levels. I think it is obvious that they understand that part of it. I think that when something bad or negative happens, something good comes out of it. One of the things that we are all going to benefit from in the future is that the cities are more reticent to restaff and go back to business as usual. I think from the standpoint of processing procedures, processing costs, processing time frames, and some of our worst enemies over

would like to congratulate VALLEY PARTNERSHIP on 25 YEARS of responsible development in Arizona. We look forward to the next 25 years of outstanding leadership as the Valley braces for 2 million more residents.

3101 N. Central Ave., Suite 1070 | Phoenix, Arizona | (602) 277-6045 | www.azBIGmedia.com

ÂŠ 2012 CBRE, Inc.

CBRE would like to congratulate VALLEY PARTNERSHIP for 25 years of leadership in the commercial real estate industry and for advocating responsible development throughout metropolitan Phoenix.

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VALLEY PARTNERSHIP: ROUNDTABLE

5 Most Important Advocacy Issues

Passage of Proposition 303 in 1998, which created the Growing Smarter Act and allowed for municipalities to purchase Arizona State Trust Land for Conservation. This combined with the all-out effort to defeat a Portland-Style Growth Boundary Proposal, Proposition 202, which was on the ballot at the same time. Pete Bolton the last decades, some of those will see some level or relief. We are also seeing some of the cities are courting us to do something in their communities. Not that they have much to give us, other than a friendly hand and encouragement to do something. But it is nice to see that they are reacting to figure out how to jump-start their own economies and their own development of their communities.

: I gave this question a lot of thought. We are in these longlived projects; 20-plus years projects so you are guaranteed to have cycles. It was early in my career somebody gave me the analogy of real estate cycles. When you’re on the downhill slide, no one ever believes that there will ever be an uphill again. So the reaction is that when I talk to most of my peers, like you guys, we are starting to observe that our days are spent on positive activities or improving activities, whereas a year ago we were slugging through tenant failures, defaults and bank loans and all of that stuff. The cities are still in that downhill-looking position, so their reaction time is slower, which is frustrating. At the other end of it nobody ever thinks there is going to be a downhill again. So I love the industry. We have a balancing act; you want to take advantage of those mood swings when they work for you. But when you step back as a responsible player in this industry, you’d like to see a little more perspective and a little less reaction on the staff level. We have been fortunate. We have been in very difficult cities to deal with, which is a blessing because their staff level thinking is very good. Mesa has been through an amazing evolution with its entire team — from mayor down through the ranks. Scottsdale is a very challenging city, but it is very sophisticated and a lot of time they have a really good point. I like being held to that higher standard, even on the days I’m complaining about it. It’s nice to have lots of examples to refer different towns and cities to, and it’s nice to have Valley Partnership as a sounding board for some of those revolving towns, too.

: I think when the savings and loans crisis hit, maybe because it was my first downhill cycle, it seemed that more people were

52 | May-June 2012

Collaborated with the City of Phoenix to draft the “Big Box Ordinance,” which protected the ability of retailers to operate facilities larger than 100,000 square feet.

Revised the Arizona State Statutes, which regulate municipality’s ability to use sales tax revenue to reimburse commercial real estate developers for the installation of public infrastructure.

Revised the Arizona State Statutes to preserve the Government Property Lease Excise Tax (GPLET) to promote redevelopment in blighted areas of municipalities.

Supported the City of Phoenix at the Arizona Supreme Court by filing an Amicus Brief in Turken v. Gordon. The Amicus Brief helped persuade the Supreme Court that a municipality’s use of sales tax to reimburse developers for the cost of public infrastructure was not in violation of the Arizona Constitution. Source: Valley Partnership

CENTENNIAL  SERIES

Valley Par tn e rs h ip I s You r Advocate For R e s p on s ib le R e al E s tate Deve lop me n t

VALLEY PARTNERSHIP: ROUNDTABLE

sort of “deer-in-the-headlights-look” than when this crisis hit. A lot of people said, “I know what mode to go into,” and even the cities knew that it was going to be a tough 4-5 years to get through. At least for me the memories of the late ‘80s early ‘90s, those that are veterans knew what you had to do and what was required at that point in the cycle.

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: I’m going to go on a little twist. I thought Pete was going to go there first, but I’m going to the first one to throw a question back. The question is good. King Crab and Yakimono Hawaiian Ahi areWe justtalked about local and state, but what about the Feds? Is it different now than 20 years ago with the some of the delicacies Salt Cellar and mortgage regulation, it Fed? I know thatthat formake the the homebuilders has been a lot harder on them.

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made a comment about the municipalities as well as: John charcoal broiled fish and Cajun-style blackened seafood are understandadditional ing current real estate. That hit pretty solid. I don’t think what

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assets initially were heldtwin under thehours CMBS, forand thosehow whomany appreciate fine that seafoodwere • Don’t miss our popular happy

and it is daunting to look at the RTC days and look at the special fromTh 4:00pm to 7:00pm 10:00pm to 1:00am. servicers of daily today. e banks playand a again role from in the recovery in the downturn, and the bank’s FDIC, but the real power is coming out of Wall Street. You know what, the fascinating part of this is that they are just rebranding and heading back into something else. I mean it really is amazing to watch that place operate. And 90% of the population does not even know what is even going on in those four city blocks.

RH PB

: What are the greatest challenges that lie ahead for Valley Partnership?

550 N. Hayden Rd • Scottsdale, AZ

: Wall Street (480) financing and •the influence they have on our 947-1963 www.saltcellarrestaruant.com businesses. I think it would be a great seminar sometime. Dinner served nightly Bring in people who know how to chat about it. It’s something that

68  March-April 2011 54 | May-June 2012

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we all need to get educated on. I’m getting a severe education right now. As far as greatest challenges, I think nimbyism is right up there. We got to go vertical. The density is an issue. The economics of density is an issue. What Scottsdale has been doing lately is almost unbelievable with the 6-, 7- and 8-story apartment buildings. I thought I’d never see this. I think the downturn has some fascinating outcomes much to so many people’s dismay. But from the standpoint of Valley Partnership, how do we start switching that mentality? I don’t know if all of you agree with this, but I think that horizontal development has got to take a leap vertically, forward. And we need the politicos to support us with that.

: I agree with that sentiment. What you’ll find is that you’ll get a number approved and then they’ll shut the door. I think it is erratic. I don’t think that they will be consistent necessarily when they determine density. I’ve already seen just in Scottsdale, with apartments, it’s a four-letter world. Even though they have enough planned, everybody is getting afraid of what’s planned, even though they won’t all show up. I think that when you have erratic behavior in a city, it’s impossible which direction. It is an opportunity to keep them educated and keep in front of them as it relates to what are the benefits.

: Most of the built environment that you see every day in this town has happened in the past 60 to 65 years. One of the biggest challenges that Valley Partnership has is that its membership must go forward, make a change and start addressing vertical construction. Our industry will have to start becoming better at harvesting tougher deals. I think that the days of “blow and go” at the surface is coming to a stop. In 1985, we all decided to pass a bill that we invest billions and billions into a freeway system and I don’t see a next super giant equivalent economic development dump of money like that was. I do think one of the biggest challenges for our membership, and therefore for us, is this change that is going to have to take place and really look into more sophisticated ways to do a better job.

: John and I were talking at a ULI gathering, saying we have a foot in each camp because we are both in very urban projects in Downtown Tempe. Pete’s right that vertical development is here to stay and it is the wave of the future. It’s complicated because the infrastructure in the cities was not sized to take on big vertical projects, so it really drives a complicated bargain for the cities and the municipalities. It has been really fun the past 5 to 6 years watching Phoenix, Scottsdale, Tempe and Mesa. When when they get into that infill, they have to throw their zoning codes out and go to form-based management or some type of regulatory procedure. It is really fascinating to watch because some of these old style, stodgy cities have brought in these new-style thinkers and they’re throwing the books out and starting over. It’s really what it requires. They are going to have address the infrastructure because most of it is not sized right to go that dense.

: I have a general answer that I give to any organization to start with. I think that anybody that doesn’t continually evaluate purpose, value and leadership will go the way of a dinosaur at some point. The thing that Valley Partnership has actually done a good job over the past 25 years is constantly asking those questions and 55

VALLEY PARTNERSHIP: ROUNDTABLE

the services that I provide; the need for services that all of us provide. That is the exciting challenge. It was pretty easy back in the day. You go out and buy 20 acres and put down a grocery store, some shops, and a couple of paths and you go on your way. But 6 months later you have Walmart pouring footings across the street. Our experience with infill, once is happens, it is tougher to do. You’re dealing with land assembly. You’re dealing with environmental remediation. You’re dealing with high-priced land. If you can get it done, your competition is limited.

: The issue is – and I have seen this a lot recently – is who is waiting for the momentum play versus things just getting better regardless of what you do? Prosperity versus the creativity play. I do think that this urbanism issue is one that will give us more lengths to recovery; a better place to live. It isn’t the only thing that Valley Partnership should focus on, but I think it is uniquely qualified to do a lot in that discussion just because of the cross section and the diversity it has in its membership.

Jim Pederson generating legacy-type leadership. First and foremost my hope is that we continue to adapt – as an organization. I do think, and Charley is right, that we have talked about it a lot. One of the interesting things that we can and should weigh in on is this more densification of the city and change the urban form. I think it is going to happen and if it is not done thoughtfully, the result is going to be much less fulfi lling and rewarding.

: Maybe we are using the wrong words. I have heard vertical. What about the context of urban? Urban applies to a lot more things than verticality. It applies to design. It applies to use. It’s a small example, but look what has happened on 7th Avenue and McDowell. By converting the property, it’s jobs. It’s a planners dream. Jobs, housing, entertainment, and shopping in one spot. I don’t think that if you have a well-conceived project like that, then maybe they (cities) will have to redo their codes and maybe they might have to redo their outlook. But they get it. It’s what they were taught in school and if you can generate that excitement not only on the city level but on the community level, I think most people would get it instead of being absolutely terrified.

RH JP

: What are the greatest opportunities that lie ahead for Valley Partnership?

: We are going to have to understand that our industry is going to change, I think, drastically. I don’t think we are going to Buckeye or Queen Creek anytime soon. We are necessarily talking about infill development; we are talking about the more urban concepts. That is going to involve a transformation of thinking and that is going to involve everyone in our industry. I’m excited about it. I can see opportunities within 4 or 5 miles from where we are sitting now. Same thing in Downtown Tempe. Same thing in Downtown Glendale. The same thing in any area that has a great mass of density. Hopefully an income level that would sustain a good quality development that needs 56 | May-June 2012

: There is another dimension of redevelopment that we haven’t really touched on. Our first big project as a company was Centerpoint in Downtown Tempe. When I was going to ASU there was a lot of old, rundown stuff there. It is immensely rewarding to just go see a re-creation of things that have deteriorated and were once rundown. My personal experience, I was on the front of what was the old Caterpillar Tractor Desert Proving Grounds, and now we are doing Eastmark. We are taking these vast pieces of really underused infilled properties.

: There may be the need to guide the committee structure and leadership toward urban redevelopment and higher density issues. How do you back fill for infrastructure? Water lines need to be this big. There needs to be more priority put on the types of issues that Valley Partnership needs to focus on. Valley Partnership has never been a self-policing type of situation. If there was a way to get a grassroots raising of the bar in our industry, have a position and a dialogue that causes the membership to say that they want to operate at a higher bar than they are used to, a lot of good leadership could come out of it. Valley Partnership could drive the message of its own.

: When I look at the greatest opportunity or challenges, I have two thoughts. One is I continue to believe that the best work that Valley Partnership does is at the grassroots levels and what it does with all of its cities and towns and educating the staff and working with them to write new ordinances. Urban infill is a green field. They are going to have a lot of homework to do. In the job of being the communicator and sharer of great ideas, Valley Partnership can really play a great leadership role. I think that the challenge and opportunity is to make sure that you have the right staff and have the right committees and have people who are committed and engaged to get in there. I have been blessed to see the impact we have on city managers and planning directors and staff people by just having a dialogue and saying this doesn’t work and let me tell you why. I think that there is great opportunity.

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VALLEY PARTNERSHIP: CHAIRMAN Q&A BY STEPHANIE GONZALEZ

ick Hearn joined the Valley Partnership Board of Directors in 2005 and has been an integral part of its leadership team, culminating with the chairmanship in this, the 25th anniversary of the organization. A 25-year veteran of the commercial real estate industry, Hearn joined Vestar in 1994 as its director of leasing, overseeing much of the leasing, marketing and broker management of Vestar’s retail portfolio in the Southwest, complementing his duties and capacities as its designated broker. Over the years, Vestar and Valley Partnership have enjoyed a rich heritage. Three of Valley Partnership’s chairmen — Lee Hanley (chairman/CEO), who participated in the original framework and served in 1995; and Pat McGinley (VP of property management), who guided the board in the 2003; and now Hearn — are affiliated with Vestar.

WHAT DOES IT MEAN TO BE AN ADVOCATE FOR THE COMMERCIAL REAL ESTATE INDUSTRY? A: One word, “important.” As a Metro Phoenix-based organization advocating for the industry, our focus is precise yet flexible, and extends throughout the entire “Valley of the Sun.” The importance and responsibility of being the only real estate-based organization, not a chapter or division of a regional or national entity, but native to the Valley … “invaluable.” We are sought after and respected for our responsible positions on industry-related issues whether local, regional, statewide or federal.

HOW IMPORTANT IS THAT ADVOCACY DURING THESE TOUGH ECONOMIC TIMES? A: Advocacy is important all of the time. Each economic cycle creates differing challenges for our industry, and, bad policy decisions, regardless of timing, impact subsequent cycles. A balanced advocacy approach minimizes potential negative outcomes, while fostering prosperity for all stakeholders, both public and private.

WHAT ARE VALLEY PARTNERSHIP’S GOALS FOR 2012?

A: Continued application of our founding principles — advocacy, networking, education and community projects. Th is past October, bolstered by our board retreat, one facilitated by Todd Hornback, a respected non-profit professional; we developed four centric goals for our 2012 focus — board development and leadership, organizational communication, development and enhancement of strategic alliances and organizational fiscal policies.

HOW WILL VALLEY PARTNERSHIP ACHIEVE THESE GOALS?

A: Each element of the organization has specific objectives or goals developed at the retreat. Measurable action items are continually evaluated, whether at the organizational, board, staff or committee 60 | May-June 2012

level. The organization’s biggest direction and efforts come from the 10 standing committees, comprised of volunteer executives (partners) that execute on those goals and objectives. Our partners are our biggest assets. For the organization to continually evolve, and pursue its mission objectives, we must develop future leadership from these committees, thus fostering partner involvement.

WHAT ARE THE BIGGEST CHALLENGES IN 2012?

A: Preparing for the eventual turnaround of our industry and that of the “Valley of the Sun” we all call home, while working with our partners through this still very challenging economic cycle. Valley Partnership’s mission remains constant, continual support for all of our partners and to help their organizations prosper.

AS VALLEY PARTNERSHIP CELEBRATES ITS 25TH ANNIVERSARY, WHAT LIES AHEAD? A: The road ahead includes a reflection of our past, a continual focus on the present mission, and a strategic look at how our industry will manage the next two decades of Valley growth, which could include more than two million new Phoenicians. Th is reflection has allowed us to touch our past 21 chairs so as to re-engage and respect our heritage, including the “founding” chairman, Ron Haarer Sr. (1987). And, we said a final farewell to a trusted leader and past chair in Gregg Alpert. We’ve catalogued our past accomplishments (municipal and legislative successes) or the more than 25 community projects completed, with more than $3.5M in charitable dollars raised and countless man-hours volunteered. As to our near-term future, continued organizational governance, growth of new partners and/or new partner firms, adding emerging business sectors to our already diverse business base and strengthening our alliances. And, through our actions always declaring “Valley Partnership is the Valley of the Sun’s premier advocacy group for responsible development.”

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* This ranking is based on responses to NREI’s top brokerage survey, conducted in February and March 2011. Brokers provided the total dollar value of leasing transactions and investment sales globally in 2010. In the case of the major national brokerage networks, the survey sought the totals for all offices combined – including independent offices of networks such as the RE/MAX network. ** Average yearly volume in commercial transactions for the RE/MAX network, from 2003-2011.

VALLEY PARTNERSHIP: PAST CHAIRMEN BY MARIA THOMPSON

25 B

Years of Exemplary Leadership

ehind every great organization are great leaders. And Valley Partnership is no exception. With the Valley-based development group celebrating its 25th anniversary, AZRE magazine posed the following question to its past chairmen: What was Valley Partnership’s most significant or greatest accomplishment while you were chairman?

1987-88 1989 1990 1991 1992-93 1994 62 | May-June 2012

Ron Haarer, Sr., Westwind Aviation

Haarer

“Valley Partnership’s first Board of Directors was comprised of members of the development community, city officials and community activists. Watching these diverse groups working together was the ultimate reward for months of soulsearching and persistence and 25 years of continual existence.”

John Graham, Sunbelt Holdings

“I’m proud that a new organization was able to survive a difficult real estate downturn and was a positive participant in working through the RTC era. A large number of people have contributed to (V.P.’s 25-year) success.” Graham

David Scholl, Westcor/Vintage Partners

“Valley Partnership’s participation in a yearlong discussion with the Regional Transportation Commission, and making efforts in communication and partnership was a success.” Scholl

Charlie Byxbee, Byxbee Development Partners

Byxbee

“Sustaining the organization through such a harsh real estate environment. In addition, we were actively involved with the policies of the Resolution Trust Corporation, and Valley Partnership was able to provide input to the RTC, including offering testimony during oversight hearings that were held in Phoenix.”

John Ogden, Suncor Development

"Staying alive — I served for two years and it was clearly, 'staying alive.' We were just coming out of the RTC era and everybody was broke or being sued." Ogden

Meyer Turken, Turken Industrial Properties

“We hired qualified executive directors and became more politically and legislatively active. Our industry can be proud of the way we led the charge and have made Phoenix and Maricopa County the great metropolis it is today.” Turken

1995 1996 1997-98 1999 2000 2001 2002 2003

Lee Ha nley, Vestar

“Our objectives for 1995 were influencing government positions on real estate, expanding our membership, and providing networking opportunities. V.P. created a new category of membership for government agencies. Perhaps our greatest achievement was to retire a promissory note created in 1987 to finance Valley Hanley Partnership operations in the early years. We became self supporting.”

Tim Terrill, Sella Barr/Walton

“Substantially expanding our public sector membership and broadening out private sector reach. Advocating responsible development and input on real estate and growth policies at the state and local level.” Terrill

Clesson Hill, Grayhawk Development

“Focusing on the growth of the community project and making it into an integral part of Valley Partnership’s membership and the efforts of our active committees.” Hill

Jim Pederson, The Pederson Group

Pederson

“During my tenure, I was most proud of our progress in promoting quality development in Arizona. Such initiatives as ‘Growing Smarter’ provided a set of guiding principles to help Arizona not just grow, but reach for the next level in developing quality growth.”

Gregg Alpert, Evergreen Development

Valley Partnership and the commercial real estate community lost a leader and a friend on Sept. 25, 2010, when Gregg Alpert unexpectedly passed away. He was 45. Alpert

Ken Roth, Roth Development

“Valley Partnership’s greatest and most challenging accomplishment was trying to make sense of the events of Sept. 11 and assessing the relationship between the attacks and the real estate business.”

Roth

Heidi Kimball, Sunbelt Holdings

Kimball

“Valley Partnership assumed a leadership position in formulating the Outreach Task Force that was challenged with creating a coalition to work proactively on issues confronting business and the real estate development industry, thereby leveraging the industry’s influence at the local and state levels.”

Pat M cGinley, Vestar

“Created the framework for the Annual Sponsorship Program that was instituted for the following calendar year. Also, organized the first Flat Tire Tour and increased financial reserves for Valley Partnership to more than $200,000.” McGinley

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VALLEY PARTNERSHIP: PAST CHAIRMEN

2004 2005 2006 2007 2008 2009 2010 2011 66 | May-June 2012

Pete Bolton, CBRE/Grubb & Ellis

“We needed someone well connected with the Legislature and Governor’s Office and were fortunate to get Maria Baier (as President and CEO). She was considered one of the true experts on the subject (of development). We also put together the Cross Association Collaboration, which included Valley Partnership, Bolton NAIOP, ICSC, BOMA and almost every development association.”

Jay Tubbs, Ryan/Monte Vista Consulting

“The biggest accomplishments during my tenure were the growth in our membership, Valley Partnership’s leadership role in the effort to achieve reform at the State Land Department and the continued focus and growth of the annual community project, which I consider one of the most important works of Valley Tubbs Partnership each year.”

Charley Freericks, DMB Associates

“Working closely with State Land Commissioner Mark Winkleman to draft Proposition 106 and staff the lobbying effort. V.P. formed task forces under the county committees, providing prompt review of the proposition.” Freericks

Keith Ernest, RED Development

“Collaborating with our membership to assist suburban municipalities in their efforts to streamline the development processes. V.P. preserved the practice of allocating sales tax revenues toward infrastructure reimbursement.” Ernest

Steve Betts, Suncor Development

“Bringing together a coalition of business groups, cities and legislative leaders to pass innovative authority for local economic incentive development agreements with the appropriate protections of public interests.” Betts

Sean Walters, Sunbelt Holdings

Walters

“The board worked quickly and diligently with CEO Richard Hubbard to cut costs and increase benefits to our partners. We increased our focus on networking and helping unemployed members find jobs with new enterprises. Valley Partnership additionally made adjustments to create a balanced budget for 2010.”

Mark Winkleman, ML Manager

“Valley Partnership’s greatest accomplishment was holding together the primary voice for the real estate community during the toughest economy any of us have ever endured.” Winkleman

Mindy Korth, CBRE

“Valley Partnership members re-energized the commitment and focus of the organization and then getting the word out about our accomplishments through a thoughtful and branded communication plan.” Korth

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VALLEY PARTNERSHIP: PARTNERS BY MICHELLE LAUER

Mike Markham Jr.

Markham Contracting

ike Markham Jr., vice president and chief operating officer at Markham Contracting, isn’t involved in many trade organizations. “But I’ve chosen to stay in Valley Partnership because of the value it brings,” Markham says. “It goes beyond just the business connections, it’s about to the community service we do. That’s why we stay involved — Valley Partnership is moving forward and trying to be influential in the Phoenix area while remembering it’s important to give back to the community.” The fifth-generation Arizonan established membership with Valley Partnership through the community project committee. Eight years later, he’s still involved with both Valley Partnership and the committee, which manages annual donations to local nonprofits to enhance facilities for children and those in need. Markham began working in the construction industry in 1995, receiving his bachelor’s degree in construction engineering from Arizona State University in 1999. After several years at another company, he went to work for his father’s business, Markham Contracting, in 2001. “We’re a family business my father started in 1977, so I grew up around Markham Contracting,” he says. “My dad founded it, and now we’re moving into our second generation — my sister and I are taking over the day-to-day operations, transitioning to the second generation.”

Heidi Kimball

Sunbelt Holdings

eidi Kimball, vice president and designated broker at Sunbelt Holdings, exemplifies the American Dream. She started working at the commercial real estate firm in 1982 as the receptionist, and worked her way up through decades of loyalty and dedication. Kimball became involved with Valley Partnership in 1994, first participating in the state legislation committee. Her first year on the Board of Directors was in 1998, and, after several terms, she served as Valley Partnership president in 2002. Still active in the organization, she foresees Valley Partnership will continue its work as a channel between the public and private sectors. “I think V.P. will carry on as the single point of contact for parties seeking resolution of a variety of development issues,” she says. “From a public policy standpoints, we provide the resources, the contact to the development community, as well as a bridge to municipalities and government to the citizens through village planning committees and neighborhood associations.” Kimball, who says she’s proud to see more women entering the construction industry and earning leadership roles, notes that Valley Partnership’s diversity serves in its favor. “I think Valley Partnership serves a unique role in being able to speak to, really, all sides of an issue by virtue of our diverse membership,” Kimball says. “We can address governmental, citizen and developmental concerns.”

Jeff Chaves

Abacus-Abengoa

eff Chaves joined Valley Partnership four years ago because he shares common values with the organization — action and advancement. “Valley Partnership has a very strong reputation for being the premier advocacy group in the Valley of the Sun, and I wanted to be part of that,” Chaves says. Chaves spent the first 15 years of his career as a consulting hydrogeologist, and then ventured into business development with civil engineering firm Olsson Associates. After serving as director of business development at Kitchell, he accepted a position at Abacus-Abengoa as market sector leader and where he currently serves in a consulting and advisory capacity. Abacus-Abengoa is an international company applying innovative technology solutions for sustainable development. The father of four, baseball coach and California native serves as a member of Valley Partnership’s Board of Directors. Chaves was enthusiastic when asked to join the board last year because Valley Partnership’s impact is a tangible, influential force, he says. “When you look back 25 years ago, when Valley Partnership first started and industry professionals were trying to get an audience with legislators, for example, it was difficult,” Chaves says. “Now, they come to us. That, as much as anything, is a good indication of the powerful impact of Valley Partnership in the Valley.” Chaves foresees real estate developers will emphasize sustainability in the future, both economic and environmental. Valley Partnership, he says, will remain a pivotal player in Arizona. 68 | May-June 2012

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VALLEY PARTNERSHIP: PARTNERS Debra Stark

City of Phoenix

ebra Stark, planning director for the City of Phoenix, joined Valley Partnership in the mid-1990s when the organization was first forming and establishing professional ties throughout the Valley. She was working for Maricopa County at the time and recalls being pleasantly surprised when Valley Partnership representatives appeared at the county’s Department of Transportation meeting, hoping to collaborate. “I thought, ‘That’s refreshing!’ ” Stark recalls. “They want to partner with us instead of us writing some legislation or ordinance and then them reacting negatively, and it’s better to partner than continue to fight. The next thing you know, I was drawn into the organization.” Stark, who earned her master’s in planning from Arizona State, is on the city/county committee. The Wisconsin native says she’s remained loyal to the organization for so many years because of Valley Partnership’s tangible, constructive impact on the Valley. “Valley Partnership brings a reputation of quality, and I think any Arizonan wants a quality city, so this organization knows how to reach out and promote that level of excellence,” Stark says. “They’re a voice in Arizona; they’re certainly a voice in Maricopa County and Phoenix, and they get involved for the right reasons, and that’s to improve the quality of life.”

Dick Crowley

Kitchell

fter graduating from the University of New Haven with a degree in civil engineering, Dick Crowley entered the general contracting industry in 1980. Deciding he found his niche, he stuck with the field. “I’ve been involved in projects in 20 states, including retail, commercial, healthcare, parking structures — a vast array of various projects,” he says. Crowley has since spent his entire career in commercial construction, both in operational functions and in marketing and development. Crowley is eight years into a flourishing career at Kitchell, an employee-owned construction, real estate and contracting company operating primarily in the Southwest, where he serves as vice president of marketing. Crowley is also an avid pilot, father to 4-year-old Grace, and a strong believer in sustainable expansion. He joined Valley Partnership two years ago. “Both Kitchell and myself, personally, have a vested interest in our community, particularly in Maricopa County,” Crowley says. “Valley Partnership really has become the premier advocacy group for real estate development, and as such it has created an opportunity for its members to have unique access to the policy makers that influence development in our community.” Crowley serves on the sponsorship and events committees, and particularly enjoys Valley Partnership’s Friday breakfasts. “There’s a networking function that people enjoy, but what keeps people coming back is that education component where they learn something.”

Molly Ryan-Carson

Ryan Companies US, Inc.

olly Ryan-Carson is a legacy at Ryan Companies US, Inc., a national developer and commercial real estate firm. Her grandfather founded the company in 1938, blazing a trail for a family business that would eventually span three generations. Ryan-Carson has been with Ryan Companies for 11 years. She served as retail development director for eight years, then earned a promotion to vice president of development in 2010. She joined Valley Partnership at the recommendation of a colleague two years ago, when the commercial real estate market wasn’t exactly prospering. “Though the last two years have been no picnic, it’s been very interesting to see Valley Partnership focus to maintain relevance and importance for individuals who are now looking for jobs, thereby strengthening the community,” Ryan-Carson says. “They really put their money where their mouth is, and they work hard to achieve important goals. Both myself and Ryan Companies are certainly active supporters; we believe in V.P.” Ryan-Carson sits on Valley Partnership’s Board of Directors, where she says she’s established relationships and connections that have positively impacted her career. She also serves on the events committee and often frequents the Friday morning breakfasts. “I remain involved because I feel Valley Partnership is out to make a difference for individuals at every level of commercial real estate and development,” she says.

70 | May-June 2012

COMMUNITY PROJECT BY MARIA THOMPSON

Extreme Backyard Makeover Valley Partnership's annual community project transforms a Maggie's Place facility

More than 150 Valley Partnership volunteers helped transform the grounds of the Magdalene House into a suitable environment for future moms and their kids.

f there is one thing that every house should have it’s a dream backyard. Even on a rainy November morning, Valley Partnership volunteers came together for their annual community project to bring the potential for an ideal backyard to fruition. The mission was to refurbish the yard of one of the community facilities for Maggie’s Place, a home for expectant mothers who wish to achieve their goals in a dignified atmosphere. The only significant feature of the backyard at Magdalene House’s in Phoenix, one of Maggie’s Places, was an old gazebo that was removed as part of the project’s construction. Additionally, there wasn’t much functionality with the lack of grass and a play structure. The 2011 project brought in more than 150 volunteers — more than last year’s event — with the chance for each helper to contribute. The volunteers could participate in any of the activities: Scraping the ground to level it out for the incoming playground; Filling the removed gazebo space with personalized bricks used from donations; Building a small play area, including equipment for mothers to have meetings while also watching their children; Planting, painting and ornamenting the yard to add decoration. The new backyard, completed in a day’s work, was a combination of the volunteers’ vision and the residents’ excitement. Selecting a project each year is a collaborative effort usually by a core group of volunteers on the Valley Partnership project committee. Project chairperson, Terri Martin-Denning of NAI Horizon, says the group decided on Maggie’s Place because “it fit Valley Partnership’s mission; their needs aligned with our (Valley Partnership) goals.” Once the project is chosen, a development team is assembled to plan the construction process. The committee members then look

for those with skilled labor to complete the heavy building; removing the worn gazebo was one of those arduous tasks. Finally, the volunteers are recruited and the renovations can commence. Those behind Maggie’s Place founded the first house on Mother’s Day of 2000 — a suitable day to express gratitude for current and future moms. Magdalene’s House in Phoenix began with five pregnant women in need of a home. It has since expanded to five houses located in Tempe, Glendale and Cleveland, Ohio. The mission of Maggie’s Place is to: Provide hospitality for pregnant women alone or on the streets; Connect expectant and new mothers to resources involving prenatal care, health insurance and education; Inform and encourage the use of savings programs to prepare mothers for life after Maggie’s Place. Valley Partnership is the only grass-root organization in Arizona dedicated to promote responsible development. Its commitment was particularly revealed in the restoration of Maggie’s Place and the enthusiasm of both the volunteers and the recipients. Director of facilities at Maggie’s Place, Dave Kriegl, says they are always looking for outreach from volunteers and organizations. He also says that despite the rain that November day, there was “quite a transformation and a remarkable change” after the volunteers finished the job. Both Martin-Denning and Kriegl say they believe the expectations of the committee and the women residing in Maggie’s Place were fully met. Through the laborious work of the volunteers, the residents of the Magdalene House are able to relish in a renewed and kid-friendly backyard, host events and enjoy all the benefits that Maggie’s Place has to offer.