Tucson Development Thread

[Anqrew]

Nice new photo of Hub At Tucson

photo by Mark B. Evans/ITB

The swanky, sleek high-rise apartment complexes just steps from the University of Arizona, along with similarly appointed buildings downtown and close to Fourth Avenue, are wrapping up construction this year for the fall 2014 semester and bringing to a close a solid three years of building purpose-driven student housing.

By the end of this year, roughly 1,150 units constituting about 3,200 beds will be built for students, in the towers and elsewhere within blocks of UA. And university-area property owners are already feeling it.

Allan Mendelsberg, who specializes in apartment and investment sales at Picor, said as the 2013-14 school year approached, owners of smaller, dated campus-area properties got desperate and took big reductions just to fill units; in the fourth quarter of 2013, the university submarket was the only one to see a drop in rents.

can read the rest of the article here: http://www.insidetucsonbusiness.com/...9bb2963f4.html


While i think initially these new towers are bad for older complexes farther from campus. I think this is better for Tucson, for decades the student population has lived in a fairly large radius of campus. Now that we are seeing denser housing, a lot of students who normally would live 1-5 miles away are now less than a mile away. I think its better to get these students closer to campus. as for the student housing that is far from campus, i think its necessary for them to cater to market rate units and housing families and not just students to re-energize those neighborhoods which have been dominated by college students for so long. I think this will also benefit tucson because this will bring in more people to Tucsons core that normally would live a bit farther out. But these are just my opinions

[Anqrew]

photo by Hillary Davis/ITB

Tucson is a relatively stable space for retailers. It’s seen growth booms and busts, not unlike Phoenix. But unlike Phoenix, its bubble didn’t swell so high and fast.
It never got a crosstown freeway, so interstate frontage was largely reserved for industrial uses and homes and shopping were built in the city’s core. Shopping centers were never overbuilt. And it’s even closer to Mexico, home to many a weekend shopper.

So malls, those enclosed, tiled, air-conditioned and pretzel-scented bazaars, have better results than the industry stories usually tell, even with newer mall-like complexes like power centers and lifestyle centers within a few miles.

The areas around Tucson’s two large traditional malls, Tucson Mall and Park Place, remain very attractive to restaurants and shops. They’re “hubs,” said Nancy McClure, First Vice President and a retail specialist at CBRE’s Tucson office— so much so that developers are razing older, dated shopping centers in their immediate area to put up new big boxes (see accompanying story).

Because retailers never built a glut of stores, shopping real estate has always been at a premium. Typically, a retailer will go to Phoenix first, get excited about the four million-plus person market and put up 15 stores, then do two or three in Tucson just to see how it goes, then move on to another market. Because the Tucson market doesn’t get as diluted, it tends to do well.

“In Phoenix, gosh, you could blaze a new road and there will be four big shopping centers on every corner. Here, it’s harder to get a good site and also, lenders look at Tucson differently than somebody like a Phoenix because it’s a tertiary market in their mind’s eye, and so they’re going to give a new project more scrutiny than they would up in Phoenix back in the time,” she said. “I think now lenders are going to give more scrutiny to everything because they don’t want to have happen what happened up in Phoenix and Las Vegas where so much of it got overbuilt.”

Pat Darcy, retail division head at Tucson Realty & Trust, said because Tucson doesn’t have nearly as many major corners as Phoenix does, it makes sense to be by one of the malls.

Darcy said the Tucson and Park Place malls are spaced out enough that they don’t really compete with each other. At Park Place especially, on Tucson’s golden retail road of Broadway Boulevard, it can be hard to find a parking spot, he said.

“Tucson is really supporting those two malls,” Darcy said. “They say the malls are kind of dying off, but not here.”

read the rest here: http://www.insidetucsonbusiness.com/...9bb2963f4.html

another article i found interesting. I think other than Downtown, these areas are the "Hubs" like mentioned in the article, they form a nice kind of Tri-fecta of commerce. I think it would be really nice to see these Mall areas also become lively neighborhoods of themselves, I think with the 2 new restaurants opening in the Park Place Hub (Longhorn and Yardhouse) we will start to see some new development. I'm pretty sure the properties along broadway between Hobby Lobby and the new Longhorn are next to be razed, hope to see some good development there!

[aznate27]

Originally Posted by Anqrew

Nice new photo of Hub At Tucson

photo by Mark B. Evans/ITB

The swanky, sleek high-rise apartment complexes just steps from the University of Arizona, along with similarly appointed buildings downtown and close to Fourth Avenue, are wrapping up construction this year for the fall 2014 semester and bringing to a close a solid three years of building purpose-driven student housing.

By the end of this year, roughly 1,150 units constituting about 3,200 beds will be built for students, in the towers and elsewhere within blocks of UA. And university-area property owners are already feeling it.

Allan Mendelsberg, who specializes in apartment and investment sales at Picor, said as the 2013-14 school year approached, owners of smaller, dated campus-area properties got desperate and took big reductions just to fill units; in the fourth quarter of 2013, the university submarket was the only one to see a drop in rents.

can read the rest of the article here: http://www.insidetucsonbusiness.com/...9bb2963f4.html


While i think initially these new towers are bad for older complexes farther from campus. I think this is better for Tucson, for decades the student population has lived in a fairly large radius of campus. Now that we are seeing denser housing, a lot of students who normally would live 1-5 miles away are now less than a mile away. I think its better to get these students closer to campus. as for the student housing that is far from campus, i think its necessary for them to cater to market rate units and housing families and not just students to re-energize those neighborhoods which have been dominated by college students for so long. I think this will also benefit tucson because this will bring in more people to Tucsons core that normally would live a bit farther out. But these are just my opinions

Agreed.

[cdsuofa]

"While i think initially these new towers are bad for older complexes farther from campus. I think this is better for Tucson, for decades the student population has lived in a fairly large radius of campus. Now that we are seeing denser housing, a lot of students who normally would live 1-5 miles away are now less than a mile away. I think its better to get these students closer to campus. as for the student housing that is far from campus, i think its necessary for them to cater to market rate units and housing families and not just students to re-energize those neighborhoods which have been dominated by college students for so long. I think this will also benefit tucson because this will bring in more people to Tucsons core that normally would live a bit farther out. But these are just my opinions "

Definitely agree. These more dense areas are going to promote more of a community feel, where you walk not drive to get places. Its already shown that it promotes retail and restaurants to move into the areas and allows for a more local unique culture. While we may end up with an empty North Pointe I think the economic benefits from the new way the University/Downtown area is being put together will far outweigh things like that.

[Patrick S]

There's a questionnaire about the I-11 corridor that can be completed at this website: http://i11study.com/wp/?page_id=819. The questionnaire can only be completed until March 7th, 2014. There are actually 4 different questionnaires: one for north of Vegas, one for the Vegas area, one for the Phoenix area, and one for southern Arizona. I've only done the southern AZ one so far, and it's only 2 questions, but it's important, I think, that we voice how important we feel it is that this road be extended to our area.

[cdsuofa]

That is def kinda scary that there are a few options that completely leave Tucson out of the route. When I think about how Tucsonans are about change I get even more worried. I definitely am concerned that some Avra Valley residents will speak out against the project and the city/county will do what they always do and let some tiny, but loud, minority hold back the entire economic growth of Tucson. I give you Grand Canyon University, the 20 years of arguing about widening Kolb from Sunrise to Sabino Canyon and on and on. So many things turned down that would have improved Tucson shot down by small, but more important LOUD, minority groups that don't want anything to change for the greater good of Tucson's infrastructure and economy. Do they want their kids to have to continue to work in call centers for $11 an hr or have to move to Phoenix for a respectable salary? Of course most of them are retired and have no family in Tucson nor interest in its future because frankly they will pass away before most of it happens. Sorry for the rant Ive just been so frustrated with how the City/county rolls over for these people no matter what the greater good is for Tucson-metro. Completed survey btw everyone else please do so as well (The Southern Arizona one) http://i11study.com/wp/?page_id=819

[Patrick S]

Found something interesting in the Agenda for the March 4th, 2014 Tucson City Council Meeting: The Liquor License for Pizzeria Bianco will be up for discussion and vote. I'm sure it will be approved, and that means the establishment will be one step closer to being opened.

http://www.tucsonaz.gov/sirepub/mtgv...doctype=AGENDA

[ProfessorMole]

Found this article from the AZ Daily Star on Feb 21st detailing some talks from each outlet.

The Avra Valley developers seem really adamant they will open first and be the only outlets even though Twin Peaks has a leg up because the site already has some infra in place.

Dueling Outlet Centers

[southtucsonboy77]

From the Albuquerque Journal:

Tesla Motors sent out an email Wednesday with more details on its planned $4 billion to $5 billion giga battery factory including a map showing the four finalists that includes New Mexico.

Tesla also is considering sites in Nevada, Arizona and Texas for the massive battery factory that would employ around 6,500 people.

The Palo Alto, Calif.-based company expects the factory to supply enough batteries for the 500,000 cars it hopes to make by 2020.

Tesla and partners including battery maker Panasonic will invest between $4 billion and $5 billion to build the factory, which would supply battery packs to Tesla’s Fremont, Calif., assembly plant.

“As we at Tesla reach for our goal of producing a mass market electric car in approximately three years, we have an opportunity to leverage our projected demand for lithium ion batteries to reduce their cost faster than previously thought possible,” the company said.

“In cooperation with strategic battery manufacturing partners, we’re planning to build a large scale factory that will allow us to achieve economies of scale and minimize costs through innovative manufacturing, reduction of logistics waste, optimization of co-located processes and reduced overhead,” according to the email.


Does anyone know if TREO/Tucson is in the running for this on the AZ side of things?

[ProfessorMole]

Originally Posted by southtucsonboy77

Does anyone know if TREO/Tucson is in the running for this on the AZ side of things?

Searched through as many as I could find, and it looks like it's just states as a whole listed right now. New Mexico, Texas, Arizona, and Nevada.

[cdsuofa]

Originally Posted by southtucsonboy77

Does anyone know if TREO/Tucson is in the running for this on the AZ side of things?

Im sure our Governor isn't out there putting an effort to get Tucson into the mix, even though we are the capital of cheap labor and large lots of cheap land next to the UP Rail connection to Cali/Mexico/East coast and knowing our city we'd prolly give them the land and cut most of their taxes lol. Hopefully someone is out there campaigning for Tucson. Big opportunity would be nice to see us get that

[southtucsonboy77]

Originally Posted by cdsuofa

Im sure our Governor isn't out there putting an effort to get Tucson into the mix, even though we are the capital of cheap labor and large lots of cheap land next to the UP Rail connection to Cali/Mexico/East coast and knowing our city we'd prolly give them the land and cut most of their taxes lol. Hopefully someone is out there campaigning for Tucson. Big opportunity would be nice to see us get that

Everything about this opportunity screamed Tucson...especially the logistics.

I noticed that the AZ Daily Star finally developed an article on this factory, but it bothers me that 1) the article came out a day after the Albq Journal 2) it was short and less detailed than the Albq Journal. I don't know, maybe its a good thing...less press...less pressure for our local leaders to screw up. All in all, we need JOBS.

Which brings up my other concern...this article: Tucson-area hotel occupancy slipped in January.

People need reasons to come to Tucson. As far as major entertainment...we are waaaay behind the times. An extemely limited amount of promoters/shows are willing to perform at the TCC (excuse me, Tucson Arena). We don't have a major concert venue. I went to the George Strait concert (don't judge me) last month and the hotel I stayed at was loaded with people from Tucson. I felt ashamed, but if the wife wants to go to George Strait and its in Phoenix...then I gotta do what I gotta do. We are "renovating" the Arena, but we're putting lipstick on a pig. Is it gonna raise the ceiling of the arena? The height is outdated and for concerts that have fantastic pyrotechnics...the arena doesn't work. I mean, not even the WWE does shows here anymore. (This rant is based on a news story I saw last night).

Anyhow, this is all inter-connected...jobs...economic development...tourism...entertainment. Its frustrating.

[ppdd]

Originally Posted by southtucsonboy77

Does anyone know if TREO/Tucson is in the running for this on the AZ side of things?

This type of project would probably have come through the Arizona Commerce Authority pipeline and Tucson sites would have been included in a response if they fit the requirements.

Generally, 6,500 employees is really pushing the project size that could be considered here due to availability of ready workforce. Ironically, our lowish unemployment rate hurts us when looking at these numbers. (The plant would instantly become our 4th largest private employer.) We certainly have some points that make sense, but there are a number of complications.

[Patrick S]

Originally Posted by southtucsonboy77

Everything about this opportunity screamed Tucson...especially the logistics.

I noticed that the AZ Daily Star finally developed an article on this factory, but it bothers me that 1) the article came out a day after the Albq Journal 2) it was short and less detailed than the Albq Journal. I don't know, maybe its a good thing...less press...less pressure for our local leaders to screw up. All in all, we need JOBS.

Which brings up my other concern...this article: Tucson-area hotel occupancy slipped in January.

People need reasons to come to Tucson. As far as major entertainment...we are waaaay behind the times. An extemely limited amount of promoters/shows are willing to perform at the TCC (excuse me, Tucson Arena). We don't have a major concert venue. I went to the George Strait concert (don't judge me) last month and the hotel I stayed at was loaded with people from Tucson. I felt ashamed, but if the wife wants to go to George Strait and its in Phoenix...then I gotta do what I gotta do. We are "renovating" the Arena, but we're putting lipstick on a pig. Is it gonna raise the ceiling of the arena? The height is outdated and for concerts that have fantastic pyrotechnics...the arena doesn't work. I mean, not even the WWE does shows here anymore. (This rant is based on a news story I saw last night).

Anyhow, this is all inter-connected...jobs...economic development...tourism...entertainment. Its frustrating.

While I agree that a drop from 55.7% occupancy rate to 54.1% from January 2013 and January 2014 is not a good thing, the article didn't address whether this may have been caused by an increase in the number of hotel rooms. I don't know if this is the case or not, but an increase in the number of rooms available could decrease the percent filled, even as it increases the number filled. Say you have 100 rooms. If 50% are filled you obviously have 50 filled. If you build 50 more rooms, but your rate goes down to 40%, you still have 10 more filled, for a total of 60 filled. This is just speculation. With the horrible winter the northeast and midwest is having you would think that hotels would be filled more this year than last (I'd be interested to see if there's a jump in home sales after this winter). Of course, it did say that the Phoenix area had an increase in occupancy rate (though it didn't say from what to what), and if we added hotel rooms, I'm sure they added even more than we did, so there rate would in essence be even more impressive.

[Thirsty]

Mexican Sugar coming to Port of Tucson

...

The Port of Tucson’s ability to bring the sugar up from Mexico by rail sealed the deal, Rionda said

...

Tucson could be the place where the company’s five U.S. distribution sites are consolidated in the future, Rionda said.

“It is one of the few facilities in the U.S. that has that capability — in essence their own railroad,” he said. “We feel we can service all West Coast markets from there.”

Small announcement, but still big news. Even without Punta Colonet or the Baja rail link, the recent focus on utilizing the city's rail resources is paying off. Hopefully this sort of cross-boarder development takes off and positions Tucson strongly if Punta Colonet is ever built.

[cdsuofa]

Originally Posted by southtucsonboy77

Anyhow, this is all inter-connected...jobs...economic development...tourism...entertainment. Its frustrating.

Im glad to hear somebody say this. Because it is more interconnected than most think. Operations like this whether it be factories, regional corporate offices, distribution center.. really whatever. One of the main factors is quality of life in said City. Are there roads to get our employees to work easily? Are there quality schools? Is there entertainment in the city for our employees? Will educated people stay in this city? And then come the questions that directly relate to the business. Is there existing rail infrastructure? Is there existing interstate infrastructure? Can the city accommodate business visitors with nice accommodations/airport and tourist activities? Anyway one could go on and on with these.. and they really do make a huge impression on if these projects do locate to said city. Point... Tucson cant just throw tax incentives at companies, they need to improve in these areas as well.
Its also good to hear that sugar is being imported directly to Tucson from Mexico. Just another step in the right direction to making Tucson an inland port.

[Ted Lyons]

The newest issue of Zocalo came out today and the One East Broadway ad in it says they only have one open unit left. IIRC, the ad in last month's issue said seven units were left. Maxing out occupancy this quickly will hopefully be a sign to other developers.

[InTheBurbs]

There were a couple of items of interest in the mayor's State of the City Address the other week. Both were reported in the news before, but may be closer to reality.

* "Perhaps as early as this summer, we will have nonstop flights from Tucson to Hermosillo..." (previous flights to Hermosillo ended in 2008).

* Speaking of downtown development: "Over the next year...You’ll see ground broken on a new, modern, urban hotel"

Full text of speech here

[ProfessorMole]

Originally Posted by InTheBurbs

* Speaking of downtown development: "Over the next year...You’ll see ground broken on a new, modern, urban hotel"

He's gotta be talking about the AC right? Hadn't heard of any others yet.

[InTheBurbs]

Originally Posted by ProfessorMole

He's gotta be talking about the AC right? Hadn't heard of any others yet.

I'm assuming he was talking about the AC as well.

Also, in the latest reports on the Tesla factory, Tucson isn't mentioned as a possible location.

KOAT in Albuquerque reports that ABQ is in the lead over Phoenix, Reno and Austin.

And the Phoenix Business Journal says Tesla has been looking at sites in the Phoenix area.