By Roland Murphy for Arizona Builder’s Exchange
The stereotype rooted in many people’s minds when thinking of Peoria is still one of retirees, isolated and aging developments, open areas with little infrastructure and a firm adherence to semi-rural and agricultural roots.
Despite extensive growth, particularly near the area’s major freeways, that view remains a difficult one to shake, but dynamic changes have been in the works for years, with many already underway and many more on the near horizon.
Attendees to this week’s 2017 Peoria Investment Forum, sponsored in part by AZBEX, got some myths dispelled, some opportunities presented and a lot to think about between what’s already on the city’s plate and the massive opportunities soon to come down the pike.
Neck-and-Neck with Other Target Zones
After welcoming remarks by Peoria Mayor Cathy Carlat and a state of the region overview by Greater Phoenix Economic Council President & CEO Chris Camacho, Scott Whyte, the city’s director of Economic Development Services, jumped into discussing available and pending opportunities, and what differentiates Peoria from the Valley’s top-of-mind hot spots like Tempe Town Lake and Norterra in north Phoenix.
In talking to the crowd of approximately 120 investors, business leaders, partners and officials, Whyte quickly highlighted Peoria’s control of properties in several key micro markets, its experience in public-private partnership, its aggressive economic development plans backed by the City Council, and its ability and willingness to fund development initiatives.
One issue confronting the city addressed by both Camacho and Whyte, is the fact that, even though many companies – 30 percent of which currently reside in California – are interested in potentially relocating here, more than 80 percent of them want existing real estate. “Time to occupancy is a major consideration for site selectors,” Camacho said.
Both acknowledged that, at present, Peoria has a serious deficiency when it comes to existing speculative development, particularly when it comes to office space for Class A and higher B options.
In his presentation, Whyte addressed that issue, and others, to highlight Peoria’s aggressive economic development efforts. He pointed out the city leadership’s focus on speed to market for development, making particular note of the program to priority track projects with significant economic impact. Such projects move to the front of the line for review and approval without any additional cost to the developers.
Whyte then spring boarded into the city’s planned Peoria Innovation Center Campus at P83 to illustrate the city’s program commitment and put to rest any thoughts of Peoria as a non-competitive market. The P83 area, which includes all the development around the Peoria Sports Complex, will soon be the focus of a major build-out, in partnership with Plaza Companies.
Taking 17 acres currently established as surface parking, the project will deliver 275KSF of Class A office space with supporting, walkable amenities to promote a live/work/play environment. Negotiations are in process to finalize a ground lease and development agreement. The supporting area will include the established amenities, along with additional retail, restaurant, multifamily and structured parking space.
Whyte said he hopes to have everything in place for groundbreaking next year.
Apples to Apples
In the meat of his presentation on Peoria’s competitiveness, he highlighted the P83 project against others around the Valley. Major demographic factors in nearly all cases were exceptionally similar.
The P83 center offers 275K of Class A office space, buttressed by a garage with 3,150 parking spaces, a four-story hotel, 25KSF of retail and restaurant and more than 3,000 multifamily units, in an area hungry for such development.
Hayden Ferry at Tempe Town Lake being the closest competitor in terms of Class A offerings, Whyte pointed out the higher planned volume of on-site retail, the greater number of hotel rooms and the fact that Hayden Ferry is an 11-year-old development.
Then he brought up the comparison points of likely greatest interest to site selectors. First were the demographic comparisons between Peoria’s population and those of Tempe, north Phoenix and south Gilbert. General population, population by education level and employment across business segments are nearly identical. However, the West Valley in general, and Peoria in particular, have 80 and 92 percent levels of outbound commuters, respectively.
With only two major employment centers in Peoria for higher-end workers, Whyte noted there is a severely underserved demand for job opportunity among area residents.
Lastly, and perhaps most importantly to those considering relocation, was the point of cost. Projected rents in the P883 center are between $26 and $28.50/SF. Rents at Hayden Ferry are around $40. With that cost difference, the opportunities for build-to-suit, customization and other tenant improvements are enormous, Whyte said.
In discussing other areas planned for development on the immediate horizon or in the very near future, Whyte highlighted the city’s investment in pre-creating infrastructure, setting zoning, planning locations near major transportation routes, securing development and marketing partnerships, and focusing on issues such as amenities and desirable lifestyle components before the nuts and bolts corporate and industrial development.
After all, retail may follow rooftops, as the saying goes, but creating an area where companies want to call home and workers can actually live conveniently and with access to their creature comforts, is a driver any area has to consider when appealing to the decision makers.
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