By Roland Murphy for AZBEX
The Mesa City Council will vote July 1 on a tax incentive/development cost reimbursement package for the Medina Station Commercial development at the SEC of Signal Butte and Southern Avenue on the east side of town.
SimonCRE’s Medina Station Commercial development is a 40-acre part of a nearly 65-acre master planned area that has been through several iterations over the last two years. As we reported last September, SimonCRE was brought in as the commercial component developer with plans for approximately 300KSF of retail and restaurant development. (AZBEX; Sept. 17, 2024)
Medina Station Commercial is estimated as a $150M overall investment. The Arizona Republic reported SimonCRE’s Josh Simon told Council on June 12 the tax incentive proposal would help draw a higher class of restaurant providers to the development, which both City officials and residents have sought for years.
As we mentioned in our recent data center restriction piece and elsewhere, Mesa has struggled to draw quality restaurants and other significant lifestyle amenities to serve its growing population. (AZBEX: June 18; Sept. 18, 2024)
The City has, at various points, even tried to curtail the number of drive-thru restaurants, often preferred by developers for their ease of construction and lease-up, in new retail centers to encourage more mid-to-upper level restaurant development. (AZBEX; Sept. 30, 2022)
Under the proposed package, Mesa would reimburse 100% of the 1.2% construction tax revenue it receives from the project to SimonCRE for construction of public infrastructure like sidewalks, water and sewer lines, and similar components.
Mesa will also refund half of non-dedicated sales taxes received from the five “restaurant row” sites and the development’s two retail anchors—Target and Dick’s Sporting Goods.
The Republic noted Simon has already closed on a lease agreement with O.H.S.O. Brewery. By implementing the incentives, Simon will be able to offer restaurants better lease terms, since the company’s development costs will be lower.
Acceptable restaurants under the agreement would have to be “mid-class, high-quality, or contemporary casual full-service” with fewer than 100 national locations. Except for O.H.S.O., which already has a restaurant at Mesa-Gateway Airport, there could not be any restaurants of the same brand already operating within 10 miles of Medina Station.
All five restaurants would have to be built within 48 months of the package’s approval date. Construction would also have to be completed on the Dick’s Sporting Goods store.
