|A Phoenix company is planning what is says could be a $600 million business park on tribal land near north Scottsdale, the second large development announced in the past six months along a coveted eight-mile stretch of Loop 101.
The 209-acre project, to be called Pima Center, is a collaboration between Phoenix commercial developer MainSpring Capital Group and more than 200 landowners who are members of the Salt River Pima-Maricopa Indian Community. MainSpring said it negotiated for seven years with tribal members and families, who own properties carried down for generations.
MainSpring wants to develop up to 4 million square feet west of the 101 and north of Via de Ventura with a mix of Class A offices, big-box retail, a business hotel and some light industrial uses that could include such things as distribution centers or assembly spots for manufacturers.
Gerald Blomquist, the project director and a MainSpring Capital partner, said work on infrastructure for the project is expected to start in the first quarter of next year. He said the first buildings should open within about 18 months. The entire project will take eight years and could produce $5 million a year for the tribe in such things as sales and property taxes.
That project will go head to head with the Alter Group’s $400 million mixed-use project being planned east of Loop 101 between Via de Ventura and Indian Bend Road, east of the Scottsdale Pavilions shopping center. That development is slated to have more than 2 million square feet of offices and stores, and construction is to start in January.
“We’re certainly going to be competitors but can be mutually beneficial to each other,” Blomquist said.
Developers are chasing the hot office market in north Scottsdale.
Office vacancy is running at or near 20 percent in some parts of the Valley, but north Scottsdale continues to be a magnet for new offices and vacancy there runs at about 13 percent.
Hans Klose, the Salt River tribe’s director of community development, said both projects are important to the Indian community.
“These are the main pistons of our economic engine for the north-end corridor,” said Klose, adding that there is enough demand for the two projects.
“The 101 has become a great alternative to a Scottsdale Road address,” said Jerry Roberts, a senior vice president at CB Richard Ellis, who is handling leasing for the Alter Group. “Frankly, it’s where users want to be.”
Developers like the freeway access and the booming employment hub around the Scottsdale Airport.
Also, analysts say many companies like to put their offices near the home of the boss, and north Scottsdale is a favorite nesting spot for business heavyweights.
When the Indian community was created in the 19th century, each tribal member was allotted 20 acres. The properties have passed down through generations, and some parcels have multiple family members who share ownership.
Getting a majority to agree to lease the family holdings can take some time, and MainSpring’s Blomquist said some of the principal family members who controlled the land died during the time It took to put together the deal.
“I attended over 19 funerals,” he said. “In a lot of instances, their interests had been transferred to their heirs.”
MainSpring has a 65-year master lease, with options to extend the term. Blomquist said that it’s an attractive site that was worth the years of effort to lock down.
“It’s location, location,” he said. “You have what can be termed as almost an infill piece—two freeway interchanges, very strong demographics, one of the closest locations to the airport and employment centers in Tempe, Mesa, and Scottsdale.”
Scottsdale leaders are not panicking that the project hurt their economic development efforts.
The development will bring jobs and create some spin-off benefits for Scottsdale’s retail and housing market, said Rick Kidder, the Scottsdale Area Chamber of Commerce’s director of public policy.
“This is a case of a rising tide lifting all boats,” he said.
David Roderique, director of the city’s Economic Vitality Office, said MainSpring’s project creates “some competition, but generally we see it as complementary to what Scottsdale is doing.”
As for traffic, Scottsdale and the Salt River tribe have mutual concerns about Pima Road and at some point the road may need to be widened, given how quickly Loop 101 has filled up, Roderique said.
Salt River tribal officials did not return calls seeking comment.