Coyotes Tempe Proposal Raises Hopes, Concerns

Credit: Arizona Coyotes/Arizona Republic

In response to a request from the City of Tempe, The Arizona Coyotes have proposed creating a $1.7B mixed-use development that features an arena, hotels, multifamily and retail.

The team plans to finance the area through a blend of private investment for the core project and using Tempe sales tax dollars for $200M in additional costs for infrastructure development and remediation of the 46-acre former mining and landfill site.

The National Hockey League would build and operate the 16,000-seat arena.

Coyotes representatives estimate the overall project could generate $5.9B in direct spending and $154M in net new tax revenue over 30 years.

Tempe officials have not said when they expect to finish reviewing the proposal, but earlier statements indicated there could be an agreement in place by the end of the year if all goes well.


Regarding the estimated $70M remediation costs, the Coyotes have proposed to pay $40M for the eastern parcel, which could cover part of the remediation. They would also pay $8M to remediate the western parcel and pay for the rest through bonds that could also cover portions of the infrastructure, build a parking garage and clear the land title.

The Coyotes want Tempe to create a Community Facilities District for the site. The CFD would sell $200M special assessment revenue bonds to pay for the remediation. The bonds would be repaid over 30 years using monies for city sales taxes on the site and parking revenues, a 6% surcharge on retail sales and real estate assessments on the properties.


The Coyotes proposal, which is more expansive than the terms of Tempe’s original requirements, includes an extensive mix of uses intended to make the site a year-round destination and attraction. In addition to the 16,000-seat arena, other components include:

  • A 54KSF team headquarters and publicly available practice rink,
  • 300KSF of commercial space,
  • 320KSF of office,
  • 1,600 residential units, and
  • Two hotels.

Development would happen in two phases. Phase I would include:

  • The arena,
  • A 1,500-seat performing arts space,
  • A 200-room hotel,
  • A high-end commercial and restaurant district, and
  • Medical office space, and
  • A 12-story, 180-unit apartment development.

Phase II would feature:

  • At least 1,500 multifamily units in three complexes,
  • A 300-room convention hotel,
  • A retail center, and
  • Office space.

The team intends to make use of Government Property Excise Lease Tax breaks once construction is complete. GPLETs have been used to keep several properties in the Town Lake area off of tax rolls for set periods to encourage private development, but the program has come under increased scrutiny in recent years.

Investors will pay for all vertical construction. The team is finalizing arena design, and the search is on for a general contractor. A company led by Coyotes owner Alex Meruelo would serve as master developer.

Sky Harbor Concerns

Despite the Coyotes’ enthusiasm and Tempe’s tailoring the Request for Proposals specifically for such a response, the plan must still be reviewed by a City committee and approved by City Council. No definitive timeline for those actions has been established, and some stakeholders are already expressing concerns.

The Phoenix Aviation Department has sent a letter to Coyotes officials asking for more detail on the project’s scope. Since the property at Priest Drive and Rio Salado lines up with the two busiest runways at Phoenix Sky Harbor International Airport, Aviation officials are concerned about potential safety and flight impacts. The primary concerns are building heights affecting flight operations and flight noise impacting residents.

The Federal Aviation Administration in 2001 ruled against a proposed Cardinals stadium plan at nearby Priest Drive and Washington Street because of flight safety concerns

Phoenix Aviation Director Chad Makovsky has said the FAA has determined residential construction in the proposed area is a “noncompatible land use.” Coyotes officials have expressed confidence in all of the concerns can be worked out over time. (Source 1) (Source 2)


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