What the Kroger-Albertsons merger could mean to the Valley & Surprise
Albertsons, its sister store Safeway and Fry's Food Stores could all be under the same ownership soon. The two of Arizona's supermarket giants plan to combine forces in a deal affecting more than 250 stores and in excess of 35,000 workers around the state.
Phoenix has long been known as one of the most competitive markets for grocery stores in the country, but it could face a shake-up should grocery giants Kroger and Albertsons consummate their planned merger.
Kroger (NYSE: KR), which is the parent company of Valley-based Fry’s Food Stores, and Albertsons (NYSE: ACI), which also owns the Safeway brand, are two of the largest players in the Valley’s grocery market. If the $24.6 billion merger agreement between the two companies goes through it could have a major impact on Valley consumers as well as company employees, local executives, suppliers, other grocers and real estate developers.
The Phoenix area is the fourth largest market for Kroger (NYSE: KR) with around 100 Fry’s Food Stores locations around the Valley, according to Kroger's 2021 annual fact book. Arizona is the fifth largest state for Albertsons operations – with a total of 134 stores in the state and about 75 in the Valley, according to Albertsons latest annual report.
According to the latest report from industry tracker Chain Store Guide, Fry’s owns 26.67% of the Valley’s market share. Safeway was in fourth place with 9.73% of the market share and Albertsons has another 4.06%.
Both companies see Walmart as a key competitor. In the Valley, there are 47 Walmart locations and the Arkansas-based company has a market share of about 19.37%. If the deal goes through, it would make the combo of Fry’s/Safeway/Albertsons a lot more competitive against Walmart and smaller players including Bashas’, Target, Sprouts Farmers Market and WinCo.
In addition, Kroger and Albertsons have a significant corporate presence in the Valley. Fry’s has a headquarters in Tolleson and there is a Safeway office in North Phoenix. Kroger is developing a robot-operated distribution center in Phoenix and has a dairy in the West Valley. It is unclear yet what the combined operations of the two companies will mean for corporate or nonstore employees of Fry’s and Albertsons in the Valley.
Fry's, Safeway have more stores plannedFry's and Safeway are also growing their brands in the Valley. The Business Journal has recently reported on several new grocery-anchored developments underworks that will include new Fry's or Safeway stores including in north Phoenix, Gilbert, Surprise, Queen Creek and Peoria. The company has not addressed what will happen to stores in development if the merger is approved.
The overlap between the country's two biggest traditional supermarket companies could mean regulatory obstacles for the deal. For consumers in Phoenix, it could even mean a new company created out of the merging corporations.
According to the Cincinnati Business Courier, a Phoenix Business Journal sibling publication, the merger could face scrutiny from the Federal Trade Commission over the combined companies' dominance of market, including in Phoenix and across the Western United States.
Kroger and Albertsons said in their merger announcement last week that the deal includes a plan to spin off a new public company from Albertsons. The new, appropriately named entity, SpinCo, could comprise 100 to 375 stores.
"For the Democrat-led (FTC) to approve the deal, Kroger and Albertsons will need to convince its members that they create a viable competitor in parts of the country in which there is significant overlap," the New York Times noted last week.
When Albertsons and Safeway merged in 2015, several stores from both brands around the Valley closed because of the proximity to a sister store, to satisfy regulators. The shuttered stores brought a lot of new real estate to the market, which in time was filled by retail brands such as gyms or trampoline parks looking for empty big-box spaces.
Albertsons, its sister store Safeway and Fry's Food Stores could all be under the same ownership soon. The two of Arizona's supermarket giants plan to combine forces in a deal affecting more than 250 stores and in excess of 35,000 workers around the state.
Phoenix has long been known as one of the most competitive markets for grocery stores in the country, but it could face a shake-up should grocery giants Kroger and Albertsons consummate their planned merger.
Kroger (NYSE: KR), which is the parent company of Valley-based Fry’s Food Stores, and Albertsons (NYSE: ACI), which also owns the Safeway brand, are two of the largest players in the Valley’s grocery market. If the $24.6 billion merger agreement between the two companies goes through it could have a major impact on Valley consumers as well as company employees, local executives, suppliers, other grocers and real estate developers.
The Phoenix area is the fourth largest market for Kroger (NYSE: KR) with around 100 Fry’s Food Stores locations around the Valley, according to Kroger's 2021 annual fact book. Arizona is the fifth largest state for Albertsons operations – with a total of 134 stores in the state and about 75 in the Valley, according to Albertsons latest annual report.
According to the latest report from industry tracker Chain Store Guide, Fry’s owns 26.67% of the Valley’s market share. Safeway was in fourth place with 9.73% of the market share and Albertsons has another 4.06%.
Both companies see Walmart as a key competitor. In the Valley, there are 47 Walmart locations and the Arkansas-based company has a market share of about 19.37%. If the deal goes through, it would make the combo of Fry’s/Safeway/Albertsons a lot more competitive against Walmart and smaller players including Bashas’, Target, Sprouts Farmers Market and WinCo.
In addition, Kroger and Albertsons have a significant corporate presence in the Valley. Fry’s has a headquarters in Tolleson and there is a Safeway office in North Phoenix. Kroger is developing a robot-operated distribution center in Phoenix and has a dairy in the West Valley. It is unclear yet what the combined operations of the two companies will mean for corporate or nonstore employees of Fry’s and Albertsons in the Valley.
Fry's, Safeway have more stores plannedFry's and Safeway are also growing their brands in the Valley. The Business Journal has recently reported on several new grocery-anchored developments underworks that will include new Fry's or Safeway stores including in north Phoenix, Gilbert, Surprise, Queen Creek and Peoria. The company has not addressed what will happen to stores in development if the merger is approved.
The overlap between the country's two biggest traditional supermarket companies could mean regulatory obstacles for the deal. For consumers in Phoenix, it could even mean a new company created out of the merging corporations.
According to the Cincinnati Business Courier, a Phoenix Business Journal sibling publication, the merger could face scrutiny from the Federal Trade Commission over the combined companies' dominance of market, including in Phoenix and across the Western United States.
Kroger and Albertsons said in their merger announcement last week that the deal includes a plan to spin off a new public company from Albertsons. The new, appropriately named entity, SpinCo, could comprise 100 to 375 stores.
"For the Democrat-led (FTC) to approve the deal, Kroger and Albertsons will need to convince its members that they create a viable competitor in parts of the country in which there is significant overlap," the New York Times noted last week.
When Albertsons and Safeway merged in 2015, several stores from both brands around the Valley closed because of the proximity to a sister store, to satisfy regulators. The shuttered stores brought a lot of new real estate to the market, which in time was filled by retail brands such as gyms or trampoline parks looking for empty big-box spaces.
Massive amount of retail space planned for the northwest Valley
Retail developers have been increasingly eyeing fast-growing communities like Vistancia for new stores and restaurants.
Retail developers have been increasingly eyeing fast-growing communities like Vistancia for new stores and restaurants.
As the housing and industrial boom continues in the Valley, more retail projects have been proposed for vacant sites across the region.
In Peoria and Surprise, hundreds of thousands of square feet across dozens of buildings including grocery stores, shops or restaurants are currently planned or proposed for vacant properties at infill sites or raw desert land.
James DeCremer, a principal with Avison Young in Phoenix, said the northwest part of the Valley, a high-growth area, has "great" demographics, incomes and schools but is largely underbuilt in retail.
"Over the last 10 years, there has not been a lot of retail development, and so I think we're trying to play catch-up now," DeCremer told the Business Journal.
In the second quarter, Avison Young data shows that total available space in the retail sector has decreased for the seventh quarter in a row. The vacancy rate overall was 6.6%, while the vacancy rate for class A retail space was 3.5% in the Valley.
Historically, retail growth occurred along Bell Road and Grand Avenue, but as these corridors get closer to being built out, DeCremer said, retail development will continue following where the growth is.
"Now that Bell Road for the most part is fully built out, you're seeing that Cactus [Road], Waddell [Road], [Loop] 303 area, those are the next intersections and trade areas that are hitting their stride right now," he added.
Some of the newest retail projects that have been planned or proposed in the northwest Valley include:
Bella Fiesta Commerce Center: About 23,000 square feet of retail across four buildings proposed for 10 acres at the northwest corner of Bell and Dysart roads in Surprise developed by DeRito Partners. The new project will comprise a convenience store, retail building, a drive-thru restaurant and car wash at an infill property. The planning commission held a hearing for the project on Sept. 15.
Truman Ranch Marketplace: Truman Ranch 46 SWC LLC is proposing to build 36,473 square feet of retail across multiple buildings, 107,489 square feet of self-storage space, and 601 multifamily units developed by Dominium at the southwest corner of Cotton Lane and Waddell Road in Surprise. The city approved a preliminary development plan for the project in August.
Asante Marketplace: Barclay group is developing another grocery-anchored neighborhood center in the Asante master-planned community at the northwest corner of Pat Tillman Boulevard and 163rd Avenue. The 20-acre site will comprise a 167,205-square-foot neighborhood retail center anchored by Fry's in Surprise.
Vistancia Point: In Peoria, Barclay Group plans to build another Fry's-anchored retail center at the southeast corner of El Mirage Road and Lone Mountain Parkway. A brochure for the property shows that Fry's, which purchased 13 acres on the site this year, will occupy a 123,722-square-foot space. About six additional retail buildings totaling approximately 33,300 square feet also are proposed.
Lake Pleasant Promenade: A mixed-use project with a Home2 Suites hotel with 103 rooms and 62,254 square feet with four stories, a Springhill Suites Hotel with 97 rooms and four stories across 60,225 square feet and two drive-thru restaurants are being proposed for the northwest corner of Jomax Road and Lake Pleasant Parkway in Peoria, according to Upper West Side PHX.
The Shops at Lake Pleasant: Vestar is currently developing a 90,000-square-foot shopping center in Peoria near the Lake Pleasant Towne Center close to Happy Valley Road and Lake Pleasant Parkway. The company expects the project to open by fall of 2023. Potential tenants, according to Vestar's website, could include In-N-Out, Raising Canes, HonorHealth and Over Easy.
The Trailhead: A Safeway-anchored mixed-use project was approved by Peoria for the northeast corner of Happy Valley Road and 83rd Avenue this year. The site is slated to include 136,000 square feet of retail and restaurant space, a 15,000-square-foot worship space, amenities and a 336-unit multifamily complex.
83 Marketplace: High-end restaurants and stores have signed leases for the 83 Marketplace retail center across the road from The Trailhead in Peoria. The first phase of the project includes 20,000 square feet, which was completed last year and fully leased.
Retail developers have been increasingly eyeing fast-growing communities like Vistancia for new stores and restaurants.
Retail developers have been increasingly eyeing fast-growing communities like Vistancia for new stores and restaurants.
As the housing and industrial boom continues in the Valley, more retail projects have been proposed for vacant sites across the region.
In Peoria and Surprise, hundreds of thousands of square feet across dozens of buildings including grocery stores, shops or restaurants are currently planned or proposed for vacant properties at infill sites or raw desert land.
James DeCremer, a principal with Avison Young in Phoenix, said the northwest part of the Valley, a high-growth area, has "great" demographics, incomes and schools but is largely underbuilt in retail.
"Over the last 10 years, there has not been a lot of retail development, and so I think we're trying to play catch-up now," DeCremer told the Business Journal.
In the second quarter, Avison Young data shows that total available space in the retail sector has decreased for the seventh quarter in a row. The vacancy rate overall was 6.6%, while the vacancy rate for class A retail space was 3.5% in the Valley.
Historically, retail growth occurred along Bell Road and Grand Avenue, but as these corridors get closer to being built out, DeCremer said, retail development will continue following where the growth is.
"Now that Bell Road for the most part is fully built out, you're seeing that Cactus [Road], Waddell [Road], [Loop] 303 area, those are the next intersections and trade areas that are hitting their stride right now," he added.
Some of the newest retail projects that have been planned or proposed in the northwest Valley include:
Bella Fiesta Commerce Center: About 23,000 square feet of retail across four buildings proposed for 10 acres at the northwest corner of Bell and Dysart roads in Surprise developed by DeRito Partners. The new project will comprise a convenience store, retail building, a drive-thru restaurant and car wash at an infill property. The planning commission held a hearing for the project on Sept. 15.
Truman Ranch Marketplace: Truman Ranch 46 SWC LLC is proposing to build 36,473 square feet of retail across multiple buildings, 107,489 square feet of self-storage space, and 601 multifamily units developed by Dominium at the southwest corner of Cotton Lane and Waddell Road in Surprise. The city approved a preliminary development plan for the project in August.
Asante Marketplace: Barclay group is developing another grocery-anchored neighborhood center in the Asante master-planned community at the northwest corner of Pat Tillman Boulevard and 163rd Avenue. The 20-acre site will comprise a 167,205-square-foot neighborhood retail center anchored by Fry's in Surprise.
Vistancia Point: In Peoria, Barclay Group plans to build another Fry's-anchored retail center at the southeast corner of El Mirage Road and Lone Mountain Parkway. A brochure for the property shows that Fry's, which purchased 13 acres on the site this year, will occupy a 123,722-square-foot space. About six additional retail buildings totaling approximately 33,300 square feet also are proposed.
Lake Pleasant Promenade: A mixed-use project with a Home2 Suites hotel with 103 rooms and 62,254 square feet with four stories, a Springhill Suites Hotel with 97 rooms and four stories across 60,225 square feet and two drive-thru restaurants are being proposed for the northwest corner of Jomax Road and Lake Pleasant Parkway in Peoria, according to Upper West Side PHX.
The Shops at Lake Pleasant: Vestar is currently developing a 90,000-square-foot shopping center in Peoria near the Lake Pleasant Towne Center close to Happy Valley Road and Lake Pleasant Parkway. The company expects the project to open by fall of 2023. Potential tenants, according to Vestar's website, could include In-N-Out, Raising Canes, HonorHealth and Over Easy.
The Trailhead: A Safeway-anchored mixed-use project was approved by Peoria for the northeast corner of Happy Valley Road and 83rd Avenue this year. The site is slated to include 136,000 square feet of retail and restaurant space, a 15,000-square-foot worship space, amenities and a 336-unit multifamily complex.
83 Marketplace: High-end restaurants and stores have signed leases for the 83 Marketplace retail center across the road from The Trailhead in Peoria. The first phase of the project includes 20,000 square feet, which was completed last year and fully leased.
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NW Valley will soon be getting a new regional tourism asset!
The largest hotel, entertainment destination in state. The planned resort formerly known as Crystal Lagoons is being rebranded and developed into what the city of Glendale said will be the largest hotel and entertainment destination in Arizona. Now called VAI Resort, the entertainment destination will feature more than 1,200 luxury hotel suites and rooms, a 360-degree concert stage, 13 fine dining restaurants, white sand beaches and Caribbean-blue water. Raoul Sada, president and CEO of the Chamber said "Our strength as a region is made possible by all the tourism assets that surround us including spring training games, Westgate Entertainment District, Desert Diamond Casino, Old Town Glendale, historic Wickenburg, downtown Phoenix and the Wildlife Zoo, and more. This new attraction is icing on the cake and will provide an economic boost to all the cities that make up the NW Valley." More About VAI A 52,000-square-foot island will be the center point for the 60-acre entertainment resort, which will also host top artists with more than 100 events annually, the city said in a statement released Tuesday. The newly rebranded resort was initially planned to have 630 hotel rooms on 48 acres and was approved by Glendale City Council in 2020. It will be located on the east side of Loop 101 just south of State Farm Stadium in Glendale. The resort is expected to open in late spring of 2023, which is later than the opening date of October 2022 the city expected for the original concept, Crystal Lagoons, when the city had targeted being open in time for the 2023 Super Bowl at State Farm Stadium. The project will include the Mattel Adventure Park and a tethered balloon to take guests 400 feet in the air. An artist's rendering shows the Hot Wheels roller coaster planned for the Crystal Lagoons Island Resort in Glendale. “From the vibes of Mykonos and Tulum, to the beaches of Miami, to the concerts and parties of Las Vegas, to the ultra-modern attractions of Dubai, we’re bringing the best of the best to VAI Resort right here in the heart of Glendale," said Grant Fisher, president of VAI Resort, in a statement. In addition, VAI will offer a 20,000-square-foot spa and wellness center, wedding chapel and more than 40,000 square feet of flexible ballroom and meeting spaces. The facility is also expected to create more than 1,800 jobs for the West Valley city. |
The Phoenix -Metro self-storage market among hottest in the nation with $180M in sales
Sales of self-storage properties in Phoenix surged last year, landing the sector as one of the busiest for this category of commercial real estate assets and placing the Valley as the second-leading market in the country.
Self-storage sales in Phoenix surpassed $180 million last year, nearly three times higher than the $63 million in sales notched in 2020, according to StorageCafe, a search website that lists storage facilities across the nation.
Overall, 12 facilities changed hands in Phoenix in 2021, comprising more than 1.1 million square feet of storage, StorageCafe said, citing data from Yardi Matrix.
Steadily heating up
In 2021, Valley transactions included the $13.5 million sale of a 665-unit facility at 11658 W Bell Road in Surprise in August by an affiliate of Strategic Storage Trust IV, a private real estate investment trust sponsored by an affiliate of SmartStop Self Storage REIT Inc.
A couple months before that, California-based JLL Arizona Self Storage LLC spent $17.5 million in an off-market deal to buy a 757-unit self-storage and RV storage facility on Lindsay and Germann roads in Gilbert.
Nationally, self-storage sales volume surpassed $10.9 billion in 2021, the highest transaction volume on record and up 161% from 2020. Around 108 million square feet of self-storage space changed hands nationwide in 2021, twice the 54 million square feet recorded in 2020. This was distributed across 1,525 facilities, compared with 862 properties in the previous year.
Phoenix saw the second-highest volume — up from fifth-highest a year earlier — among the top 10 markets that recorded the most self-storage sales, eclipsed only by New York City's Manhattan, which reached $3 billion last year, nearly seven times higher than the $483 million in sales notched in 2020.
Tucson was also in the top 10 for sales, coming in at No. 10 with seven properties being exchanged for more than $68.3 million — the same level Phoenix was at in 2020 — to more than double its volume year over year.
The StorageCafe report described the Phoenix metro as fairly well penetrated for storage space compared to other cities, offering more than double the storage space per capita as a place like New York City. In the Valley a 10’x10’ unit has an average street rate of $123. But even so, the report said rates are currently going up by around 10% in in the Valley and in other large metros.
Meanwhile, Florida had the most top-10 cities by sales volume in 2021. Tampa, Orlando and Miami had a total of 29 transactions for almost 2.5 million square foot of storage space.
The study also found that cities in the South lead the nation for construction of self-storage facilities, with major cities in Florida and Texas joining Phoenix, Las Vegas and Philadelphia in the top 10.
Phoenix was at No. 5 for new construction — dropping from first place a year earlier — with five facilities completed to add 558,576
Jacksonville, Florida, had the highest level of self-storage development activity in 2021, building seven facilities totaling more than 750,000 square feet.
Sales of self-storage properties in Phoenix surged last year, landing the sector as one of the busiest for this category of commercial real estate assets and placing the Valley as the second-leading market in the country.
Self-storage sales in Phoenix surpassed $180 million last year, nearly three times higher than the $63 million in sales notched in 2020, according to StorageCafe, a search website that lists storage facilities across the nation.
Overall, 12 facilities changed hands in Phoenix in 2021, comprising more than 1.1 million square feet of storage, StorageCafe said, citing data from Yardi Matrix.
Steadily heating up
In 2021, Valley transactions included the $13.5 million sale of a 665-unit facility at 11658 W Bell Road in Surprise in August by an affiliate of Strategic Storage Trust IV, a private real estate investment trust sponsored by an affiliate of SmartStop Self Storage REIT Inc.
A couple months before that, California-based JLL Arizona Self Storage LLC spent $17.5 million in an off-market deal to buy a 757-unit self-storage and RV storage facility on Lindsay and Germann roads in Gilbert.
Nationally, self-storage sales volume surpassed $10.9 billion in 2021, the highest transaction volume on record and up 161% from 2020. Around 108 million square feet of self-storage space changed hands nationwide in 2021, twice the 54 million square feet recorded in 2020. This was distributed across 1,525 facilities, compared with 862 properties in the previous year.
Phoenix saw the second-highest volume — up from fifth-highest a year earlier — among the top 10 markets that recorded the most self-storage sales, eclipsed only by New York City's Manhattan, which reached $3 billion last year, nearly seven times higher than the $483 million in sales notched in 2020.
Tucson was also in the top 10 for sales, coming in at No. 10 with seven properties being exchanged for more than $68.3 million — the same level Phoenix was at in 2020 — to more than double its volume year over year.
The StorageCafe report described the Phoenix metro as fairly well penetrated for storage space compared to other cities, offering more than double the storage space per capita as a place like New York City. In the Valley a 10’x10’ unit has an average street rate of $123. But even so, the report said rates are currently going up by around 10% in in the Valley and in other large metros.
Meanwhile, Florida had the most top-10 cities by sales volume in 2021. Tampa, Orlando and Miami had a total of 29 transactions for almost 2.5 million square foot of storage space.
The study also found that cities in the South lead the nation for construction of self-storage facilities, with major cities in Florida and Texas joining Phoenix, Las Vegas and Philadelphia in the top 10.
Phoenix was at No. 5 for new construction — dropping from first place a year earlier — with five facilities completed to add 558,576
Jacksonville, Florida, had the highest level of self-storage development activity in 2021, building seven facilities totaling more than 750,000 square feet.
Glendale-based Avanti Windows and Doors plans to expand in the West Valley with a new 261,600-square-foot manufacturing, distribution and office facility in El Mirage.
Avanti purchased the site from Jacob F. Long in November for $5.1 million, according to real estate database Vizzda. Long also sold about 1,000 acres adjacent to the Avanti site to Dermody Properties for $52 million in December.
Avanti Windows & Doors LLC is a manufacturer and installation contractor of vinyl window and door systems across the South and Southwest. The company produces and installs windows for single-family homebuilders across the Arizona, Texas and California markets.
The new El Mirage facility will be located on about 30 acres on the southwest corner of El Mirage Road and Olive Avenue and constructed in one phase. The plant is expected to be fully operational by 2025, according to project plans submitted to El Mirage.
Most of the facility will be used for production, while about 17,000 square feet will be dedicated for office space and a small mezzanine. The facility will be part of the city's Copperwing Logistics Center, which could see another 10 million square feet of industrial space developed over the next decade by Nevada-based Dermody Properties.
Top-five employerPlanning documents said the plant will operate a first and second shift Monday through Friday. Each shift will include about 150 employees, documents said, adding that the company will have about 130 field employees. As of 2021, the company had 444 Valley employees, according to Business Journal research.
Avanti currently operates in Glendale and was looking for a new location to expand the site and building footprint, documents said. Once complete, El Mirage documents said Avanti will "bring many new jobs" and be one of the top five employers in the city.
El Mirage City Council approved a zoning application for light manufacturing for the site in early November, city documents show.
Avanti did not immediately respond to a request for comment on its expansion.
The facility will include a building height of about 40 feet with a 24-foot clear height, one truckwell with 29 dock doors and four grade doors, as well as nearly 700 parking spaces. Four access points will be located along Olive Avenue.
The company said it could eventually expand some facilities into the Olive Avenue frontage for employee facilities, which is not part of the current project. The project design team includes Gilmore Planning & Landscape Architecture and Cawley Architects, according to city documents.
Avanti purchased the site from Jacob F. Long in November for $5.1 million, according to real estate database Vizzda. Long also sold about 1,000 acres adjacent to the Avanti site to Dermody Properties for $52 million in December.
Avanti Windows & Doors LLC is a manufacturer and installation contractor of vinyl window and door systems across the South and Southwest. The company produces and installs windows for single-family homebuilders across the Arizona, Texas and California markets.
The new El Mirage facility will be located on about 30 acres on the southwest corner of El Mirage Road and Olive Avenue and constructed in one phase. The plant is expected to be fully operational by 2025, according to project plans submitted to El Mirage.
Most of the facility will be used for production, while about 17,000 square feet will be dedicated for office space and a small mezzanine. The facility will be part of the city's Copperwing Logistics Center, which could see another 10 million square feet of industrial space developed over the next decade by Nevada-based Dermody Properties.
Top-five employerPlanning documents said the plant will operate a first and second shift Monday through Friday. Each shift will include about 150 employees, documents said, adding that the company will have about 130 field employees. As of 2021, the company had 444 Valley employees, according to Business Journal research.
Avanti currently operates in Glendale and was looking for a new location to expand the site and building footprint, documents said. Once complete, El Mirage documents said Avanti will "bring many new jobs" and be one of the top five employers in the city.
El Mirage City Council approved a zoning application for light manufacturing for the site in early November, city documents show.
Avanti did not immediately respond to a request for comment on its expansion.
The facility will include a building height of about 40 feet with a 24-foot clear height, one truckwell with 29 dock doors and four grade doors, as well as nearly 700 parking spaces. Four access points will be located along Olive Avenue.
The company said it could eventually expand some facilities into the Olive Avenue frontage for employee facilities, which is not part of the current project. The project design team includes Gilmore Planning & Landscape Architecture and Cawley Architects, according to city documents.
Phoenix Business Journal Features Surprise Economic Development Exec.
Meet Jeanine Jerkovic, an economic development exec who makes sure her city isn't a 'Surprise'
Since before the Great Recession, Jeanine Jerkovic has worked to change the public's perception of Surprise and bring big-name businesses, initiatives and projects to the city of 143,000-plus residents northwest of Phoenix.
Throughout her time working in Surprise's economic development department, Jerkovic has helped launch several notable projects, including the AZ TechCelerator, the West Valley's first business incubator for technological innovation and entrepreneurship, and a soft landing program for international businesses called Global Concierge Services, which the International Business Incubation Association accepted into the Global Soft Landings Network in 2018.
Jerkovic has also recently helped bring a planned Carvana Co. inspection facility and popular amenities like Costco and a 700,000-square-foot shopping center with commitments from Barrio Queen, O.H.S.O Brewery, FatCats Entertainment, Sprouts Farmers Market and several other major retailers. The outdoor shopping project started construction earlier this month.
How has your approach to economic development changed since you started as director?
Fundamentally, the community and the market has changed since 2014 so drastically that we have taken a different approach. When I started, the city was a starter community with a lot of starter needs. ... It was about really convincing the external market that Surprise wasn't stagnant, wasn't just a suburb, wasn't just a retirement village. There were a lot of perceptions, not only about Surprise but about the entire West Valley, that were fundamentally harming us and they were not supported by data. When I started, our focus was 75 to 80% business attraction and 20 to 25% local business support. Now, I would say where it's going, where 2022 will lead us, you're probably going to see the opposite.
How have your international roles and experience, including as a trade commissioner for the Canadian Consulate of Phoenix, contributed to your work in Surprise?
The biggest impact that my background had was when I started with Surprise, our primary skill set was really driven toward small business assistance for the reason that Surprise through the Recession had to get really good at helping small businesses. We were building the incubator.
When I started going to Canada and other markets and meeting international companies, it helped me realize pretty quickly that international business attraction and talking to companies about traversing the border is almost identical with conversations you have with small businesses, because it's all new. We realized we had what it takes to really serve international markets, because we had small business skillsets in Surprise. ... it helped us take the plunge and become the first certified soft-landing program in the state of Arizona.
How would you sum up 2021 for Surprise and what will the city's focus be in 2022? One was the industrial sector, we all knew the industrial sector, advanced manufacturing sector was accelerating — 2021 really proved that to be very accurate. We saw the Surprise Railplex absorb a lot of activity. It's almost entirely sold out within the last 120 days. The second thing I would observe is that the retail trend that really started the acceleration of retail activity in 2020 really carried into 2021.
As a result of those factors taking shape, we'll have a lot more focused conversations around those sectors, we'll probably look strategically at how to locate and how to curate attraction in our Surprise City Center and north Surprise. Those are really the two areas where you see the most potential, just because a lot of [Loop] 303 has been absorbed. Because of those key strategic industry focuses, we're probably going to more than ever before focus on two things ... looking at identifying true infrastructure solutions, partnerships, ideas, looking at infrastructure as an anchor for future development ... and workforce development.
How do you expect the Taiwan Semiconductor Manufacturing Co. plant to change Surprise?
It's already changing Surprise with a lot of the market activity, that's either expressed interest or under contract in our market and throughout the surrounding communities. ... We know the supply chain and others that are coming into the market because of TSMC, it's going to change the employment profile and it's going to change employment demand. When I talk about the need for us to accelerate our workforce proficiency, a fourth to a third of that is because of the TSMC effect in Surprise.
Biggest projects or plans we should be aware of in Surprise in 2022?
This will be an important year for us to accelerate our workforce and infrastructure development strategies and position our community competitively to maximize the tidal wave of commercial and residential growth that that will continue into 2022. Expect new announcements throughout 2022 along the Prasada Loop 303, at Surprise City Center and even in north Surprise.
What are the top three places people should visit in Surprise? My personal go-to spots are usually Jim’s Burgers & Eggs for breakfast, Tom Yum Thai for lunch and Saigon Kitchen for dinner.
Jeanine Jerkovic
Title: Economic development director
Company: City of Surprise
Education: Bachelor's degree, political science and German, Arizona State University Honors College; master's degree, comparative politics, London School of Economics; Certified Economic Developer (CEcD)
What do you like to do for fun outside of work? I love to spend as much time as possible with my family, and I enjoy cooking and baking. Food is my love language — I am a huge fan of the Great British Baking Show.
Best advice you’ve ever received? Rick Weddle, former CEO of Greater Phoenix Economic Council, used to have amazing advice. My favorite was: “Treat your career like a business.”
What would you do in another life? Either be a pastry chef or a creative writer.
Meet Jeanine Jerkovic, an economic development exec who makes sure her city isn't a 'Surprise'
Since before the Great Recession, Jeanine Jerkovic has worked to change the public's perception of Surprise and bring big-name businesses, initiatives and projects to the city of 143,000-plus residents northwest of Phoenix.
Throughout her time working in Surprise's economic development department, Jerkovic has helped launch several notable projects, including the AZ TechCelerator, the West Valley's first business incubator for technological innovation and entrepreneurship, and a soft landing program for international businesses called Global Concierge Services, which the International Business Incubation Association accepted into the Global Soft Landings Network in 2018.
Jerkovic has also recently helped bring a planned Carvana Co. inspection facility and popular amenities like Costco and a 700,000-square-foot shopping center with commitments from Barrio Queen, O.H.S.O Brewery, FatCats Entertainment, Sprouts Farmers Market and several other major retailers. The outdoor shopping project started construction earlier this month.
How has your approach to economic development changed since you started as director?
Fundamentally, the community and the market has changed since 2014 so drastically that we have taken a different approach. When I started, the city was a starter community with a lot of starter needs. ... It was about really convincing the external market that Surprise wasn't stagnant, wasn't just a suburb, wasn't just a retirement village. There were a lot of perceptions, not only about Surprise but about the entire West Valley, that were fundamentally harming us and they were not supported by data. When I started, our focus was 75 to 80% business attraction and 20 to 25% local business support. Now, I would say where it's going, where 2022 will lead us, you're probably going to see the opposite.
How have your international roles and experience, including as a trade commissioner for the Canadian Consulate of Phoenix, contributed to your work in Surprise?
The biggest impact that my background had was when I started with Surprise, our primary skill set was really driven toward small business assistance for the reason that Surprise through the Recession had to get really good at helping small businesses. We were building the incubator.
When I started going to Canada and other markets and meeting international companies, it helped me realize pretty quickly that international business attraction and talking to companies about traversing the border is almost identical with conversations you have with small businesses, because it's all new. We realized we had what it takes to really serve international markets, because we had small business skillsets in Surprise. ... it helped us take the plunge and become the first certified soft-landing program in the state of Arizona.
How would you sum up 2021 for Surprise and what will the city's focus be in 2022? One was the industrial sector, we all knew the industrial sector, advanced manufacturing sector was accelerating — 2021 really proved that to be very accurate. We saw the Surprise Railplex absorb a lot of activity. It's almost entirely sold out within the last 120 days. The second thing I would observe is that the retail trend that really started the acceleration of retail activity in 2020 really carried into 2021.
As a result of those factors taking shape, we'll have a lot more focused conversations around those sectors, we'll probably look strategically at how to locate and how to curate attraction in our Surprise City Center and north Surprise. Those are really the two areas where you see the most potential, just because a lot of [Loop] 303 has been absorbed. Because of those key strategic industry focuses, we're probably going to more than ever before focus on two things ... looking at identifying true infrastructure solutions, partnerships, ideas, looking at infrastructure as an anchor for future development ... and workforce development.
How do you expect the Taiwan Semiconductor Manufacturing Co. plant to change Surprise?
It's already changing Surprise with a lot of the market activity, that's either expressed interest or under contract in our market and throughout the surrounding communities. ... We know the supply chain and others that are coming into the market because of TSMC, it's going to change the employment profile and it's going to change employment demand. When I talk about the need for us to accelerate our workforce proficiency, a fourth to a third of that is because of the TSMC effect in Surprise.
Biggest projects or plans we should be aware of in Surprise in 2022?
This will be an important year for us to accelerate our workforce and infrastructure development strategies and position our community competitively to maximize the tidal wave of commercial and residential growth that that will continue into 2022. Expect new announcements throughout 2022 along the Prasada Loop 303, at Surprise City Center and even in north Surprise.
What are the top three places people should visit in Surprise? My personal go-to spots are usually Jim’s Burgers & Eggs for breakfast, Tom Yum Thai for lunch and Saigon Kitchen for dinner.
Jeanine Jerkovic
Title: Economic development director
Company: City of Surprise
Education: Bachelor's degree, political science and German, Arizona State University Honors College; master's degree, comparative politics, London School of Economics; Certified Economic Developer (CEcD)
What do you like to do for fun outside of work? I love to spend as much time as possible with my family, and I enjoy cooking and baking. Food is my love language — I am a huge fan of the Great British Baking Show.
Best advice you’ve ever received? Rick Weddle, former CEO of Greater Phoenix Economic Council, used to have amazing advice. My favorite was: “Treat your career like a business.”
What would you do in another life? Either be a pastry chef or a creative writer.
A national health care developer has started work on its first project in the Phoenix market with a new hybrid facility in Surprise, a fast-growing suburb of northwest Phoenix.
The $6.5 million provider-based emergency room and urgent care facility, HonorHealth Prasada, will be a 12,000-square-foot space with full X-ray and CT scan capabilities, including a trauma room and exam suites. It's expected to provide about 30 to 40 jobs.
Anchor Health Properties, a health care real estate developer, and JE Dunn Construction, broke ground in June on the southeast corner of the Loop 303 and Waddell Road, which is adjacent to new restaurant developments and a new Costco on Waddell Road.
Anchor Health Properties is developing the facility in partnership with Intuitive Health and HonorHealth, which has multiple hospitals and centers across Phoenix metro. It will sit within the Prasada master-planned community, which is being developed in partnership between Macerich Development, WDP Partners and RED Development and marketed as 3,355 acres.
RED Development said on its website that more than 700 acres of the community will be dedicated for commercial uses such as an auto mall, regional shopping center, hospital, office and hospitality components.
Larry Hawthorne, vice president of JE Dunn, said the new medical facility is expected to open April 1 of next year. He said the ER and urgent care is filling a need in the Surprise area near the Loop 303, which has seen an increase in industrial and residential construction.
“What’s happening is, obviously, there’s a lot of building going off the 303,” he said. “There’s really not — at this point in time — access to health care facilities.”
More facilities planned
With six planned hybrid facilities around Phoenix metro, Hawthorne said HonorHealth wants to “reach out to the population, get you to their facility, and then if something’s major then they can take you up to their major medical centers for more severe treatment.”
Hawthorne said HonorHealth is considering other West Valley cities for facilities.
According to JE Dunn, the dual emergency and urgent care model eliminates the need for patients to self-diagnose the severity of their health concerns before selecting a medical center for care and could help lower out-of-pocket costs. Hawthorne said adding the facility off the Loop 303 in Surprise provides closer access for residents.
"To be able to get to a facility very quickly in case something's wrong, you got better access to a facility without having to drive a long distance," he said.
JE Dunn Construction is the general contractor for the Surprise project. The architect is Devenney Group.
After HonorHealth Prasada is built, another hybrid ER and urgent care model is planned for Scottsdale near Mountainside Fitness and HonorHealth Scottsdale Shea Medical Center. JE Dunn will also be the general contractor for the Scottsdale project.
According to Colliers International, medical office development in Phoenix metro ended the second quarter this year with 206,449 square feet of net absorption. Rental rates increased about 6.1% year-over-year ending at $23.05 per square foot.
Two new buildings were completed in Q2 totaling over 150,500 square feet, while product under construction decreased below the five-year average with 231,000 square feet underway, according to Colliers.
The $6.5 million provider-based emergency room and urgent care facility, HonorHealth Prasada, will be a 12,000-square-foot space with full X-ray and CT scan capabilities, including a trauma room and exam suites. It's expected to provide about 30 to 40 jobs.
Anchor Health Properties, a health care real estate developer, and JE Dunn Construction, broke ground in June on the southeast corner of the Loop 303 and Waddell Road, which is adjacent to new restaurant developments and a new Costco on Waddell Road.
Anchor Health Properties is developing the facility in partnership with Intuitive Health and HonorHealth, which has multiple hospitals and centers across Phoenix metro. It will sit within the Prasada master-planned community, which is being developed in partnership between Macerich Development, WDP Partners and RED Development and marketed as 3,355 acres.
RED Development said on its website that more than 700 acres of the community will be dedicated for commercial uses such as an auto mall, regional shopping center, hospital, office and hospitality components.
Larry Hawthorne, vice president of JE Dunn, said the new medical facility is expected to open April 1 of next year. He said the ER and urgent care is filling a need in the Surprise area near the Loop 303, which has seen an increase in industrial and residential construction.
“What’s happening is, obviously, there’s a lot of building going off the 303,” he said. “There’s really not — at this point in time — access to health care facilities.”
More facilities planned
With six planned hybrid facilities around Phoenix metro, Hawthorne said HonorHealth wants to “reach out to the population, get you to their facility, and then if something’s major then they can take you up to their major medical centers for more severe treatment.”
Hawthorne said HonorHealth is considering other West Valley cities for facilities.
According to JE Dunn, the dual emergency and urgent care model eliminates the need for patients to self-diagnose the severity of their health concerns before selecting a medical center for care and could help lower out-of-pocket costs. Hawthorne said adding the facility off the Loop 303 in Surprise provides closer access for residents.
"To be able to get to a facility very quickly in case something's wrong, you got better access to a facility without having to drive a long distance," he said.
JE Dunn Construction is the general contractor for the Surprise project. The architect is Devenney Group.
After HonorHealth Prasada is built, another hybrid ER and urgent care model is planned for Scottsdale near Mountainside Fitness and HonorHealth Scottsdale Shea Medical Center. JE Dunn will also be the general contractor for the Scottsdale project.
According to Colliers International, medical office development in Phoenix metro ended the second quarter this year with 206,449 square feet of net absorption. Rental rates increased about 6.1% year-over-year ending at $23.05 per square foot.
Two new buildings were completed in Q2 totaling over 150,500 square feet, while product under construction decreased below the five-year average with 231,000 square feet underway, according to Colliers.
More restaurant owners worried about rent due to Delta variant
More small businesses are able to make rent as the economic recovery continues, but restaurant owners are still struggling.
About 30% of all small businesses in the U.S. could not pay their August rent in full or on time, according to a new survey of 5,349 small business owners by small business referral network Alignable. That is an improvement over the 35% who reported rent problems in July.
But for restaurant owners, it's a different story. About 45% of restaurant owners could not pay their August rent on time or in full, up from 40% in July, showing that not all industries are seeing an improvement. A massive 88% of restaurant owners fear the Delta variant will negatively impact their recovery.
“A new movement across several cities and counties -- requiring masks inside dining establishments — is a key source of consternation for many restaurant owners. And that's one reason they're having more trouble than most paying their rent,” said Chuck Casto, head of news and corporate communications at Alignable, in an email.
He said ultimately restaurant owners are worried that if surges in cases from the Delta variant continue, there could be more government-imposed business shutdowns – although economists have predicted further shutdowns are unlikely.
“And if they manage to stay afloat, their revenues would be restricted to offering only take-out meals, which would significantly slow down their recoveries,” Casto said in an email.
Overall the survey shows improvement in paying rent in other hard-hit industries, with 33% of gym owners saying they struggled to pay August rent, down from 38% in July. About 31% of event planners said they couldn’t make August rent, which was down from 43% in July.
One group that has not seen any improvement, however, are minority-owned businesses. The majority, or about 52%, said they struggled to pay August rent in full or on time in August, essentially the same over the last few months, according to the survey.
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About 31% of non-minority-owned businesses had trouble with rent in July, down to 29% in August, according to the survey. Veteran-owned businesses came in at 22%, down from 23% in July.
“This trend shows, once again, that minority-owned businesses are not receiving the same kind of help as other small business groups. Any future funding discussions among policymakers need to eliminate or reduce this discrepancy with more targeted programs,” Alignable said in a press release announcing the data.
It’s also not equal by geography, with New York-based small businesses having the hardest time paying August rent, at about 41%, while Tennessee-based businesses had the easiest tie paying rent, at about 17%.
The Business Journals also recently polled 2,404 people from Aug. 9-11 about the return to the office, the Delta variant's impact, Covid-19 precautions and the future of workplaces, among other topics.
The survey found large companies are more likely to be reconsidering their plans due to the Delta variant. Several big employers, including Apple Inc., Google LLC and Amazon.com Inc., have indeed delayed their returns due to the Delta variant.
Another survey shows companies are less optimistic amid the rise of the Delta variant. About 39% of small-business leaders surveyed by executive coaching organization Vistage in August believe overall economic conditions will improve over the next year — down from 50% in July. About 22% of small-business leaders said the Delta variant has impacted their business.
Meanwhile, the number of job postings requiring vaccination is rising at a rapid rate, according to an analysis by the Indeed Hiring Lab.
More small businesses are able to make rent as the economic recovery continues, but restaurant owners are still struggling.
About 30% of all small businesses in the U.S. could not pay their August rent in full or on time, according to a new survey of 5,349 small business owners by small business referral network Alignable. That is an improvement over the 35% who reported rent problems in July.
But for restaurant owners, it's a different story. About 45% of restaurant owners could not pay their August rent on time or in full, up from 40% in July, showing that not all industries are seeing an improvement. A massive 88% of restaurant owners fear the Delta variant will negatively impact their recovery.
“A new movement across several cities and counties -- requiring masks inside dining establishments — is a key source of consternation for many restaurant owners. And that's one reason they're having more trouble than most paying their rent,” said Chuck Casto, head of news and corporate communications at Alignable, in an email.
He said ultimately restaurant owners are worried that if surges in cases from the Delta variant continue, there could be more government-imposed business shutdowns – although economists have predicted further shutdowns are unlikely.
“And if they manage to stay afloat, their revenues would be restricted to offering only take-out meals, which would significantly slow down their recoveries,” Casto said in an email.
Overall the survey shows improvement in paying rent in other hard-hit industries, with 33% of gym owners saying they struggled to pay August rent, down from 38% in July. About 31% of event planners said they couldn’t make August rent, which was down from 43% in July.
One group that has not seen any improvement, however, are minority-owned businesses. The majority, or about 52%, said they struggled to pay August rent in full or on time in August, essentially the same over the last few months, according to the survey.
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About 31% of non-minority-owned businesses had trouble with rent in July, down to 29% in August, according to the survey. Veteran-owned businesses came in at 22%, down from 23% in July.
“This trend shows, once again, that minority-owned businesses are not receiving the same kind of help as other small business groups. Any future funding discussions among policymakers need to eliminate or reduce this discrepancy with more targeted programs,” Alignable said in a press release announcing the data.
It’s also not equal by geography, with New York-based small businesses having the hardest time paying August rent, at about 41%, while Tennessee-based businesses had the easiest tie paying rent, at about 17%.
The Business Journals also recently polled 2,404 people from Aug. 9-11 about the return to the office, the Delta variant's impact, Covid-19 precautions and the future of workplaces, among other topics.
The survey found large companies are more likely to be reconsidering their plans due to the Delta variant. Several big employers, including Apple Inc., Google LLC and Amazon.com Inc., have indeed delayed their returns due to the Delta variant.
Another survey shows companies are less optimistic amid the rise of the Delta variant. About 39% of small-business leaders surveyed by executive coaching organization Vistage in August believe overall economic conditions will improve over the next year — down from 50% in July. About 22% of small-business leaders said the Delta variant has impacted their business.
Meanwhile, the number of job postings requiring vaccination is rising at a rapid rate, according to an analysis by the Indeed Hiring Lab.
Career & Workplace
The CDC's new mask guidance caught businesses by surprise. It's likely to cause headaches, too.
When the Centers for Disease Control and Prevention issued its latest mask guidance for fully vaccinated individuals last week, it caught many businesses off guard.
A number of major retailers quickly changed their mask policies after the CDC said those who have been fully vaccinated for Covid-19 could resume activities without wearing a mask.
But retailers aren’t the only businesses with decisions to make following the CDC’s most recent mask guidance, and experts say the guidance could cause headaches for companies for the foreseeable future.
Many of the challenges will be similar to what employers face on the vaccination front.
Kevin Troutman, co-chair of the health-care practice at Atlanta-based law firm Fisher Phillips and leader of its vaccine subcommittee, said there are several factors for employers to consider when determining mask policies in light of the CDC’s new recommendation.
While the CDC provides recommendations and guidance, Troutman said employers need to be aware the Occupational Safety and Health Administration is the agency that actually enforces federal workplace standards and could cite employers for violations.
In a prior statement, OSHA said it is reviewing the CDC guidance and will update its materials. Businesses should be watching for that, Troutman said.
“[Employers] need to keep in mind that OSHA may issue some more specific rules that may not dovetail exactly with what the CDC has said, but we think they’ll be reasonably close,” Troutman said.
Until OSHA clarifies its position, Troutman said employers have a lot of factors to consider. Workplace safety should be paramount, he said, but he acknowledged continued mask requirements could frustrate some workers or even lead to turnover.
“Employers have to take into account how it is going to work not only in terms of maintaining a safe workplace, but in retaining employees,” he said. “They’ve got to try to balance those interests.”
Angelique Rewers, CEO of The Corporate Agent, a West Palm Beach, Florida-based business training and consulting firm, said employers need to do their homework. That includes researching any state and local mask requirements for all physical locations. Companies also should consult with attorneys and insurance companies to understand potential liability.
Rewers said it’s important to talk with each department within a company, as well, because different areas of a business will have varying opinions on how continued mask requirements could affect sales, customer visits or other aspects of the business.
“You need to have the right conversations before you do anything,” she said.
Rewers said she is aware of a situation in which a client lost a customer because they insisted on everyone wearing masks and the other vendor did not. “The customer felt they were being too cautious,” she said.
Rewers said communication is critical with mask rules because it’s unlikely companies are going to craft a policy that satisfies everyone on a topic so divisive and politicized.
She said companies should make their policies easy to understand while also elaborating on the reasoning.
“[It could be], ‘This is the policy we came up with because our biggest goal is getting back to normal operations,’ or, ‘We went with this policy because, first and foremost, we want to protect the safety of our most vulnerable employees and our most vulnerable customers. That's why this is our policy,’” Rewers said.
She said companies should create human-to-human interactions between managers and employees when discussing policies. Empathy is paramount.
“You’ll need to diffuse the anger because there’s going to be a group that’s upset with you,” she said. “The only way is to try to connect with people.”
Even with good communication, experts acknowledge there will be challenging situations.
The big wrinkle in the CDC’s guidance is that it applies to people who are fully vaccinated — which can present more difficult scenarios for businesses, especially those with a high percentage of unvaccinated workers.
Troutman said many businesses are choosing to let employees who are vaccinated be exempt from mask requirements. But that also allows customers and fellow workers to infer who has and hasn’t been vaccinated, and that information ideally would be kept confidential.
He said some companies are asking workers to sign that they have been vaccinated and are now exempt from mask requirements but also acknowledge that their mask choice may lead others to make inferences about their vaccination status.
Other companies, Troutman said, are simply choosing an honor system, which carries its own set of hurdles because of workplace safety requirements.
He said it’s important for employers to take tangible steps aimed at worker safety.
“OSHA may say to the employer, ‘What do you do to ensure that you have a safe workplace?’” Troutman said. “I think if [an employer] can show they’ve made some effort to inquire on an individual basis or obtain some sort of acknowledgement in writing, those things may help us in demonstrating to OSHA that we’ve done everything we can do as an employer.”
Troutman said employers need to train supervisors to deal with unique situations that will arise, such as an employee who has a medical or religious reason not to be vaccinated.
“You don’t want people who have chosen not to be vaccinated, especially for medical or religious reasons, feeling harassed or discriminated against,” Troutman said.
Rewers said companies need to empower their managers and give them the information they need to communicate the policies to frontline workers and, if applicable, customers.
By involving managers in the discussion early on, there are opportunities to head off potential problem scenarios that could arise.
“Before you rush out and change the signs on your store or your office to say, ‘This is our new policy,’ make sure you’ve communicated it down the chain and answered the questions for the what-if scenarios,” Rewers said. “This has been a weak point for companies for a long time, and it’s my suspicion it’s going to be exacerbated right now.”
The CDC's new mask guidance caught businesses by surprise. It's likely to cause headaches, too.
When the Centers for Disease Control and Prevention issued its latest mask guidance for fully vaccinated individuals last week, it caught many businesses off guard.
A number of major retailers quickly changed their mask policies after the CDC said those who have been fully vaccinated for Covid-19 could resume activities without wearing a mask.
But retailers aren’t the only businesses with decisions to make following the CDC’s most recent mask guidance, and experts say the guidance could cause headaches for companies for the foreseeable future.
Many of the challenges will be similar to what employers face on the vaccination front.
Kevin Troutman, co-chair of the health-care practice at Atlanta-based law firm Fisher Phillips and leader of its vaccine subcommittee, said there are several factors for employers to consider when determining mask policies in light of the CDC’s new recommendation.
While the CDC provides recommendations and guidance, Troutman said employers need to be aware the Occupational Safety and Health Administration is the agency that actually enforces federal workplace standards and could cite employers for violations.
In a prior statement, OSHA said it is reviewing the CDC guidance and will update its materials. Businesses should be watching for that, Troutman said.
“[Employers] need to keep in mind that OSHA may issue some more specific rules that may not dovetail exactly with what the CDC has said, but we think they’ll be reasonably close,” Troutman said.
Until OSHA clarifies its position, Troutman said employers have a lot of factors to consider. Workplace safety should be paramount, he said, but he acknowledged continued mask requirements could frustrate some workers or even lead to turnover.
“Employers have to take into account how it is going to work not only in terms of maintaining a safe workplace, but in retaining employees,” he said. “They’ve got to try to balance those interests.”
Angelique Rewers, CEO of The Corporate Agent, a West Palm Beach, Florida-based business training and consulting firm, said employers need to do their homework. That includes researching any state and local mask requirements for all physical locations. Companies also should consult with attorneys and insurance companies to understand potential liability.
Rewers said it’s important to talk with each department within a company, as well, because different areas of a business will have varying opinions on how continued mask requirements could affect sales, customer visits or other aspects of the business.
“You need to have the right conversations before you do anything,” she said.
Rewers said she is aware of a situation in which a client lost a customer because they insisted on everyone wearing masks and the other vendor did not. “The customer felt they were being too cautious,” she said.
Rewers said communication is critical with mask rules because it’s unlikely companies are going to craft a policy that satisfies everyone on a topic so divisive and politicized.
She said companies should make their policies easy to understand while also elaborating on the reasoning.
“[It could be], ‘This is the policy we came up with because our biggest goal is getting back to normal operations,’ or, ‘We went with this policy because, first and foremost, we want to protect the safety of our most vulnerable employees and our most vulnerable customers. That's why this is our policy,’” Rewers said.
She said companies should create human-to-human interactions between managers and employees when discussing policies. Empathy is paramount.
“You’ll need to diffuse the anger because there’s going to be a group that’s upset with you,” she said. “The only way is to try to connect with people.”
Even with good communication, experts acknowledge there will be challenging situations.
The big wrinkle in the CDC’s guidance is that it applies to people who are fully vaccinated — which can present more difficult scenarios for businesses, especially those with a high percentage of unvaccinated workers.
Troutman said many businesses are choosing to let employees who are vaccinated be exempt from mask requirements. But that also allows customers and fellow workers to infer who has and hasn’t been vaccinated, and that information ideally would be kept confidential.
He said some companies are asking workers to sign that they have been vaccinated and are now exempt from mask requirements but also acknowledge that their mask choice may lead others to make inferences about their vaccination status.
Other companies, Troutman said, are simply choosing an honor system, which carries its own set of hurdles because of workplace safety requirements.
He said it’s important for employers to take tangible steps aimed at worker safety.
“OSHA may say to the employer, ‘What do you do to ensure that you have a safe workplace?’” Troutman said. “I think if [an employer] can show they’ve made some effort to inquire on an individual basis or obtain some sort of acknowledgement in writing, those things may help us in demonstrating to OSHA that we’ve done everything we can do as an employer.”
Troutman said employers need to train supervisors to deal with unique situations that will arise, such as an employee who has a medical or religious reason not to be vaccinated.
“You don’t want people who have chosen not to be vaccinated, especially for medical or religious reasons, feeling harassed or discriminated against,” Troutman said.
Rewers said companies need to empower their managers and give them the information they need to communicate the policies to frontline workers and, if applicable, customers.
By involving managers in the discussion early on, there are opportunities to head off potential problem scenarios that could arise.
“Before you rush out and change the signs on your store or your office to say, ‘This is our new policy,’ make sure you’ve communicated it down the chain and answered the questions for the what-if scenarios,” Rewers said. “This has been a weak point for companies for a long time, and it’s my suspicion it’s going to be exacerbated right now.”
Hotel job losses in Arizona won't recover much in 2021 after pandemic drop, report says
Arizona’s hotels shed more than 25% of their employees in 2020 and are only expected this year to regain a sliver of what was lost as a result of the Covid-19 pandemic.
Job losses at the state’s hotel properties totaled 15,235 in 2020, according to a state-by-state tally released Monday by the American Hotel & Lodging Association in an effort to encourage Congress to pass targeted nationwide relief for the industry.
Those losses brought the state’s hotel employment to 43,445 people, down from 58,680 in 2019. By the end of this year, the total number of hotel jobs is expected to rise to 46,037, still 12,643 fewer than 2019 levels.
The totals only count people directly employed by hotel properties. They do not include losses from other areas supported by the hotel industry, such as restaurants, retailers, events, services, vendors and suppliers, among others, the report said.
In the Valley, the Maricopa Association of Governments reported last month that local travel-related taxes totaled $32.6 billion in 2020, dropping 26% from 2019. It also said that entertainment, lodging and food and beverage — three sectors that rely heavily on travelers — saw 2020’s gross sales respectively drop 51%, 32% and 16% compared to 2019.
“Unfortunately, the road to recovery for the hotel industry is long,” the association said in a statement at the time. “The recent uptick in leisure travel for spring and summer is encouraging for hotels, however, business travel—the largest source of hotel revenue—is down 85% and is not expected to begin its slow return until the second half of this year. Full recovery is not expected until 2024.”
Arizona’s 2021 projected losses compared with 2019 levels will be the 13th highest in the nation, according to the report.
The hotel association said that leisure and hospitality has been the industry hit the hardest by the Covid-19 pandemic, with 3.1 million jobs lost nationally that have yet to return and accounting for more than a third of all unemployed people in the country, according to the U.S. Bureau of Labor Statistics.According to the report, the top five states most affected by hotel job losses are: California, projected to be down by 67,169 jobs at the end of 2021; Florida (down 39,560 jobs); New York (down 38,028 jobs); Nevada (down 22,282 jobs); and Hawaii (down 20,029 jobs).
“The pandemic has been devastating to the hospitality industry workforce, wiping out 10 years of hotel job growth,” the report said.
Arizona’s hotels shed more than 25% of their employees in 2020 and are only expected this year to regain a sliver of what was lost as a result of the Covid-19 pandemic.
Job losses at the state’s hotel properties totaled 15,235 in 2020, according to a state-by-state tally released Monday by the American Hotel & Lodging Association in an effort to encourage Congress to pass targeted nationwide relief for the industry.
Those losses brought the state’s hotel employment to 43,445 people, down from 58,680 in 2019. By the end of this year, the total number of hotel jobs is expected to rise to 46,037, still 12,643 fewer than 2019 levels.
The totals only count people directly employed by hotel properties. They do not include losses from other areas supported by the hotel industry, such as restaurants, retailers, events, services, vendors and suppliers, among others, the report said.
In the Valley, the Maricopa Association of Governments reported last month that local travel-related taxes totaled $32.6 billion in 2020, dropping 26% from 2019. It also said that entertainment, lodging and food and beverage — three sectors that rely heavily on travelers — saw 2020’s gross sales respectively drop 51%, 32% and 16% compared to 2019.
“Unfortunately, the road to recovery for the hotel industry is long,” the association said in a statement at the time. “The recent uptick in leisure travel for spring and summer is encouraging for hotels, however, business travel—the largest source of hotel revenue—is down 85% and is not expected to begin its slow return until the second half of this year. Full recovery is not expected until 2024.”
Arizona’s 2021 projected losses compared with 2019 levels will be the 13th highest in the nation, according to the report.
The hotel association said that leisure and hospitality has been the industry hit the hardest by the Covid-19 pandemic, with 3.1 million jobs lost nationally that have yet to return and accounting for more than a third of all unemployed people in the country, according to the U.S. Bureau of Labor Statistics.According to the report, the top five states most affected by hotel job losses are: California, projected to be down by 67,169 jobs at the end of 2021; Florida (down 39,560 jobs); New York (down 38,028 jobs); Nevada (down 22,282 jobs); and Hawaii (down 20,029 jobs).
“The pandemic has been devastating to the hospitality industry workforce, wiping out 10 years of hotel job growth,” the report said.
Travel & Tourism
Good, bad and ugly: Covid-19’s impact on the Valley’s tourism sector detailed in study
While it has been very clear that the Covid-19 pandemic has negatively impacted the Valley's hospitality and tourism industry, a new white paper published by the Maricopa Association of Governments shows just how bad things actually got.
The paper, which was published this month, also looks at how tourism from Mexico and Canada, which usually is a major economic driver, was hindered and hurt the overall economy.
“In Arizona, the abrupt cancellation of the Major League Baseball spring training season and other sporting events, business meetings and conventions, along with the closing of restaurants, bars and casinos, resulted in hundreds of millions of dollars in lost sales,” the report said.
Looking at what governments lost out on, MAG’s report said that local travel-related taxes totaled $32.6 billion in 2020, dropping 26% from 2019.
Entertainment, lodging and food and beverage, three sectors that rely heavily on travelers saw 2020’s gross sales respectively drop 51%, 32% and 16% compared to 2019.
When looking specifically at tourism from Canada and Mexico, Arizona and its local governments missed out on millions of dollars because of the pandemic.
Overnight travel to Arizona from Mexico in 2020 decreased 61% compared with 2019, with spending dropping from $1.37 billion to $613 million, according to MAG’s white paper.
Canadian tourismBefore 2020, Arizona would see about 1 million Canadian visitors per year, and they would spend more than $1 billion in the state, according to MAG’s report. There are also tens of thousands of Canadians who own homes in Arizona that spend the winter months here. Because Canadian tourists and snowbirds were mostly at a higher risk of complications from Covid-19 and the Canadian government’s advisories against nonessential travel, there was a 90% drop off in Canadian tourists and snowbirds during the winter 2021 season.
While losses in international travel were tough on the economy, however, MAG’s report pointed out that the Phoenix metro area performed better in 2020 than most top 25 metros in the United States with domestic travelers.
Quoting data from global tourism consulting firm HVS, MAG’s paper showed that due to Phoenix’s “seasonality patterns, heavy base of leisure demand, and proximity to a large drive-in demand base” led to some success with domestic travelers. While not enough to save the industry, it could have been worse, the report said.
As more and more people get vaccinations, surveys show that traveler optimism continues to improve. The report highlights a survey conducted by the U.S. Travel Association show that 56% of of Americans are excited to travel in the near-term, 60% are ready to travel and 54% perceive travel activities as safe.
As long as Covid-19 infection rates remain under control and vaccines are widely available and administered, MAG expects Arizona’s economic relationships with Canada and Mexico – especially on the tourism side – to start returning to prepandemic levels later this year.
“Domestic and North American business and leisure travel is expected to resume by the end of summer 2021, if vaccine rollouts in Canada and Mexico happen smoothly,” the report said. “This will finally allow for the borders to be open for nonessential travel, allowing the interconnected economies of the three nations to finally resume their growth and expansion.”
Good, bad and ugly: Covid-19’s impact on the Valley’s tourism sector detailed in study
While it has been very clear that the Covid-19 pandemic has negatively impacted the Valley's hospitality and tourism industry, a new white paper published by the Maricopa Association of Governments shows just how bad things actually got.
The paper, which was published this month, also looks at how tourism from Mexico and Canada, which usually is a major economic driver, was hindered and hurt the overall economy.
“In Arizona, the abrupt cancellation of the Major League Baseball spring training season and other sporting events, business meetings and conventions, along with the closing of restaurants, bars and casinos, resulted in hundreds of millions of dollars in lost sales,” the report said.
Looking at what governments lost out on, MAG’s report said that local travel-related taxes totaled $32.6 billion in 2020, dropping 26% from 2019.
Entertainment, lodging and food and beverage, three sectors that rely heavily on travelers saw 2020’s gross sales respectively drop 51%, 32% and 16% compared to 2019.
When looking specifically at tourism from Canada and Mexico, Arizona and its local governments missed out on millions of dollars because of the pandemic.
Overnight travel to Arizona from Mexico in 2020 decreased 61% compared with 2019, with spending dropping from $1.37 billion to $613 million, according to MAG’s white paper.
Canadian tourismBefore 2020, Arizona would see about 1 million Canadian visitors per year, and they would spend more than $1 billion in the state, according to MAG’s report. There are also tens of thousands of Canadians who own homes in Arizona that spend the winter months here. Because Canadian tourists and snowbirds were mostly at a higher risk of complications from Covid-19 and the Canadian government’s advisories against nonessential travel, there was a 90% drop off in Canadian tourists and snowbirds during the winter 2021 season.
While losses in international travel were tough on the economy, however, MAG’s report pointed out that the Phoenix metro area performed better in 2020 than most top 25 metros in the United States with domestic travelers.
Quoting data from global tourism consulting firm HVS, MAG’s paper showed that due to Phoenix’s “seasonality patterns, heavy base of leisure demand, and proximity to a large drive-in demand base” led to some success with domestic travelers. While not enough to save the industry, it could have been worse, the report said.
As more and more people get vaccinations, surveys show that traveler optimism continues to improve. The report highlights a survey conducted by the U.S. Travel Association show that 56% of of Americans are excited to travel in the near-term, 60% are ready to travel and 54% perceive travel activities as safe.
As long as Covid-19 infection rates remain under control and vaccines are widely available and administered, MAG expects Arizona’s economic relationships with Canada and Mexico – especially on the tourism side – to start returning to prepandemic levels later this year.
“Domestic and North American business and leisure travel is expected to resume by the end of summer 2021, if vaccine rollouts in Canada and Mexico happen smoothly,” the report said. “This will finally allow for the borders to be open for nonessential travel, allowing the interconnected economies of the three nations to finally resume their growth and expansion.”
Limited Cactus League attendance has ripple effect on local businesses
Booty’s Wings Burgers and Beer previously had some tables closed off and distanced, but has since returned to its normal layout as Covid-19 restrictions were lifted. Despite the change, the business has not been able to operate at full capacity due to understaffing.
By Josh Iversen – Cronkite News
In a strange way, baseball bookended the Covid-19 pandemic, at least in Arizona. While the NBA was the first league to act and suspend its season on March 11, 2020, the virus’s ripples were not truly felt in the desert until the remainder of the Cactus League schedule was called off the next day.
A year later, the pandemic now a part of our everyday lives, the Cactus League returned. With vaccine rollout off to a promising start, limited numbers of fans were allowed to attend. Covid-19 isn’t over, but we’ve now reached Opening Day and the end appears to be within sight.
Spring training baseball sandwiched the worst months of the pandemic. And its return, alongside numerous new orders from Gov. Doug Ducey, signaled the beginning of a return to normalcy for many local businesses that rely on the boost in sales that Cactus League tourists bring.
Booty’s Wings Burgers and Beer has three locations, including two near spring training ballparks in Goodyear and Surprise. Business usually sees a boost every March, co-owner Andy LiButti said, but that spike was mitigated this year by limited fan attendance and team restrictions on off-field activities.
“We’ve definitely seen a drop-off in that business,” LiButti said. “Plus, we rely a lot on the people associated with the team coming in. The sports writers, trainers, announcers, a lot of the players, they would all come in. So with them not being allowed to really come out, that’s definitely affected us also.”
LiButti added that his takeout business has done well throughout the pandemic, but initially, he could only afford to keep his restaurants open for three hours per day. Ingredient costs have risen as well. LiButti said chicken wings that used to cost him $1 per pound have tripled in price.
Another local restaurant owner, Erick Geryol, said his business usually sees a 30% increase every spring. Geryol runs Boulders on Broadway, a bar and grill with locations in Tempe and Mesa. He mentioned that sales are down this year compared to last spring, despite the 2020 Cactus League’s premature ending.
Reduced impact According to a study by the L. William Seidman Research Institute at Arizona State University’s W. P. Carey School of Business, the shortened 2020 Cactus League season generated an estimated economic impact of $363.6 million. Of that total, $213.7 million contributed to Arizona’s gross domestic product.
While seemingly large, those figures pale in comparison to Seidman’s 2018 estimates of $644.2 million total and $373 million to Arizona’s GDP. The 2021 totals were likely even lower – while a full Cactus League schedule was played this year, the shortened 2020 season averaged 6,568 fans per game. In 2021, no stadium allowed more than 4,000 fans per game, and few allowed more than 2,000.
Additionally, tourism likely decreased significantly. In 2020, 1,446 of the 2,344 fans Seidman surveyed were non-Arizona residents, or just under 62%. These out-of-state fans had a median visit length of five days, excluding single-day visitors. Safety concerns mitigated interstate travel, likely impacting not only local restaurants, but the hospitality industry as well.
Booty’s Wings Burgers and Beer (Goodyear location pictured) is one of many local restaurants that rely on annual revenue boosts from spring training crowds. But with Cactus League attendance limited this year, business has been slower than usual.
LiButti has noticed the decrease in travelers, specifically the “snowbirds” that typically come to Arizona in the winter and spring months to escape local climates.
“I think Surprise is a very right-leaning community,” he said. “So you get a lot of people that are, you know, ‘To heck with the masks. I’m not wearing these masks, they’re stupid,’ and everything. And I feel like there’s a lot of snowbirds that are kind of terrified, you know, ‘I don’t want to get sick and die.’ So we’ve definitely felt it, not just for spring training, but for all of the snowbird season. People just aren’t traveling.”
Despite these limitations, one owner has actually seen an increase in sales. Dillon McClelland runs Goldwater Brewing Co., which has brewery and tap room locations in Scottsdale and East Mesa. McClelland was able to get creative, opening his back patio usually only used as a seasonal “beer garden” to provide additional outdoor space.
But most importantly, they introduced canned beer sales. Previously, the business had only sold beers in-house. But they began marketing exclusive canned beer releases, which led to many online orders and long lines at the door to pick them up.
“Starting out, that’s basically how we were able to keep all our staff, stay afloat, and basically come out of this pandemic kind of better than we came in,” McClelland said. “Because we actually have another platform to sell our beer.
“We kind of took it as a learning opportunity and basically came out of it with a grown opportunity to sell our beers on a different platform, in cans, for to-go beers,” he added.
Each of the three businesses have also seen significant demographics changes. Most older customers have shifted to online order and pick-up at Goldwater, while LiButti and Geryol have seen sharp decreases in that age group at Booty’s and Boulders respectively.
“Our Tempe location is close to campus and most people that are 30 and up, especially some of the professors that have come out for years, they won’t come out at all,” Geryol said. “They’re very, very cautious. They don’t want to put themselves at any type of risk. But then a lot of the students, they come in and we have to ask them to please wear a mask, you know, kind of keep them at their own tables and stuff like that.”
Safety guidelines Geryol said some guests have become aggressive with managers when asked to follow safety guidelines, while others have left Google reviews criticizing the restaurant for being unsafe. He also noted that guests have been “more cavalier” at his Mesa location than in Tempe, possibly due to political leanings.
With Ducey lifting Covid-19 restrictions on businesses on March 25, each owner is now left to decide how to handle safety measures going forward. Masks have never been mandated state-wide, but the new order prohibits counties and cities from enforcing their own mask laws on private entities. It also removes distance and capacity guidelines.
This might not be a problem for Geryol, who said he hasn’t been receiving enough business at Boulders to warrant the increase to full capacity. LiButti no longer requires masks for customers, but is unsure if he will be able to return to full capacity because Booty’s is now understaffed.
“With the extra money that people are getting, you know, the extra $300 a week, nobody wants to work,” he said. “I mean, we constantly have had ads out for the past, gosh, I want to say six months, and applications just trickle in. It’s unreal. I would love to seat every table and chair in my restaurant, but I can’t because I don’t have the staff to take care of the guests.”
For McClelland, the decision is much more difficult. For now, he is still enforcing CDC guidelines. But with Goldwater succeeding as is, he knows he needs to balance safety, profits and what is sure to be a divided public reaction.
“I guess we don’t have a decision on that yet,” McClelland said. “I think we’re trying to figure that out currently. But we’ve been doing kind of the same. Our staff is still wearing masks, we usually have masks ready for people that walk in and I believe we are still enforcing them at the moment. It’s kind of hard because you’re damned if you do, damned if you don’t. You’re always going to have the people that, you know, ‘Good job, keep the masks on, keep going with that,’ and then you have the other people that are basically saying, ‘I won’t support you, it should be a freedom of the person to decide if they want the mask or not.’
“So it’s kind of a sticky decision that whatever decision we make, it’s going to affect other people. But you can’t make everyone happy.”
Booty’s Wings Burgers and Beer previously had some tables closed off and distanced, but has since returned to its normal layout as Covid-19 restrictions were lifted. Despite the change, the business has not been able to operate at full capacity due to understaffing.
By Josh Iversen – Cronkite News
In a strange way, baseball bookended the Covid-19 pandemic, at least in Arizona. While the NBA was the first league to act and suspend its season on March 11, 2020, the virus’s ripples were not truly felt in the desert until the remainder of the Cactus League schedule was called off the next day.
A year later, the pandemic now a part of our everyday lives, the Cactus League returned. With vaccine rollout off to a promising start, limited numbers of fans were allowed to attend. Covid-19 isn’t over, but we’ve now reached Opening Day and the end appears to be within sight.
Spring training baseball sandwiched the worst months of the pandemic. And its return, alongside numerous new orders from Gov. Doug Ducey, signaled the beginning of a return to normalcy for many local businesses that rely on the boost in sales that Cactus League tourists bring.
Booty’s Wings Burgers and Beer has three locations, including two near spring training ballparks in Goodyear and Surprise. Business usually sees a boost every March, co-owner Andy LiButti said, but that spike was mitigated this year by limited fan attendance and team restrictions on off-field activities.
“We’ve definitely seen a drop-off in that business,” LiButti said. “Plus, we rely a lot on the people associated with the team coming in. The sports writers, trainers, announcers, a lot of the players, they would all come in. So with them not being allowed to really come out, that’s definitely affected us also.”
LiButti added that his takeout business has done well throughout the pandemic, but initially, he could only afford to keep his restaurants open for three hours per day. Ingredient costs have risen as well. LiButti said chicken wings that used to cost him $1 per pound have tripled in price.
Another local restaurant owner, Erick Geryol, said his business usually sees a 30% increase every spring. Geryol runs Boulders on Broadway, a bar and grill with locations in Tempe and Mesa. He mentioned that sales are down this year compared to last spring, despite the 2020 Cactus League’s premature ending.
Reduced impact According to a study by the L. William Seidman Research Institute at Arizona State University’s W. P. Carey School of Business, the shortened 2020 Cactus League season generated an estimated economic impact of $363.6 million. Of that total, $213.7 million contributed to Arizona’s gross domestic product.
While seemingly large, those figures pale in comparison to Seidman’s 2018 estimates of $644.2 million total and $373 million to Arizona’s GDP. The 2021 totals were likely even lower – while a full Cactus League schedule was played this year, the shortened 2020 season averaged 6,568 fans per game. In 2021, no stadium allowed more than 4,000 fans per game, and few allowed more than 2,000.
Additionally, tourism likely decreased significantly. In 2020, 1,446 of the 2,344 fans Seidman surveyed were non-Arizona residents, or just under 62%. These out-of-state fans had a median visit length of five days, excluding single-day visitors. Safety concerns mitigated interstate travel, likely impacting not only local restaurants, but the hospitality industry as well.
Booty’s Wings Burgers and Beer (Goodyear location pictured) is one of many local restaurants that rely on annual revenue boosts from spring training crowds. But with Cactus League attendance limited this year, business has been slower than usual.
LiButti has noticed the decrease in travelers, specifically the “snowbirds” that typically come to Arizona in the winter and spring months to escape local climates.
“I think Surprise is a very right-leaning community,” he said. “So you get a lot of people that are, you know, ‘To heck with the masks. I’m not wearing these masks, they’re stupid,’ and everything. And I feel like there’s a lot of snowbirds that are kind of terrified, you know, ‘I don’t want to get sick and die.’ So we’ve definitely felt it, not just for spring training, but for all of the snowbird season. People just aren’t traveling.”
Despite these limitations, one owner has actually seen an increase in sales. Dillon McClelland runs Goldwater Brewing Co., which has brewery and tap room locations in Scottsdale and East Mesa. McClelland was able to get creative, opening his back patio usually only used as a seasonal “beer garden” to provide additional outdoor space.
But most importantly, they introduced canned beer sales. Previously, the business had only sold beers in-house. But they began marketing exclusive canned beer releases, which led to many online orders and long lines at the door to pick them up.
“Starting out, that’s basically how we were able to keep all our staff, stay afloat, and basically come out of this pandemic kind of better than we came in,” McClelland said. “Because we actually have another platform to sell our beer.
“We kind of took it as a learning opportunity and basically came out of it with a grown opportunity to sell our beers on a different platform, in cans, for to-go beers,” he added.
Each of the three businesses have also seen significant demographics changes. Most older customers have shifted to online order and pick-up at Goldwater, while LiButti and Geryol have seen sharp decreases in that age group at Booty’s and Boulders respectively.
“Our Tempe location is close to campus and most people that are 30 and up, especially some of the professors that have come out for years, they won’t come out at all,” Geryol said. “They’re very, very cautious. They don’t want to put themselves at any type of risk. But then a lot of the students, they come in and we have to ask them to please wear a mask, you know, kind of keep them at their own tables and stuff like that.”
Safety guidelines Geryol said some guests have become aggressive with managers when asked to follow safety guidelines, while others have left Google reviews criticizing the restaurant for being unsafe. He also noted that guests have been “more cavalier” at his Mesa location than in Tempe, possibly due to political leanings.
With Ducey lifting Covid-19 restrictions on businesses on March 25, each owner is now left to decide how to handle safety measures going forward. Masks have never been mandated state-wide, but the new order prohibits counties and cities from enforcing their own mask laws on private entities. It also removes distance and capacity guidelines.
This might not be a problem for Geryol, who said he hasn’t been receiving enough business at Boulders to warrant the increase to full capacity. LiButti no longer requires masks for customers, but is unsure if he will be able to return to full capacity because Booty’s is now understaffed.
“With the extra money that people are getting, you know, the extra $300 a week, nobody wants to work,” he said. “I mean, we constantly have had ads out for the past, gosh, I want to say six months, and applications just trickle in. It’s unreal. I would love to seat every table and chair in my restaurant, but I can’t because I don’t have the staff to take care of the guests.”
For McClelland, the decision is much more difficult. For now, he is still enforcing CDC guidelines. But with Goldwater succeeding as is, he knows he needs to balance safety, profits and what is sure to be a divided public reaction.
“I guess we don’t have a decision on that yet,” McClelland said. “I think we’re trying to figure that out currently. But we’ve been doing kind of the same. Our staff is still wearing masks, we usually have masks ready for people that walk in and I believe we are still enforcing them at the moment. It’s kind of hard because you’re damned if you do, damned if you don’t. You’re always going to have the people that, you know, ‘Good job, keep the masks on, keep going with that,’ and then you have the other people that are basically saying, ‘I won’t support you, it should be a freedom of the person to decide if they want the mask or not.’
“So it’s kind of a sticky decision that whatever decision we make, it’s going to affect other people. But you can’t make everyone happy.”
Texas burger chain wants to open 20 locations in Phoenix Mooyah Burgers, Fries & Shakes
Plano, TX
Restaurant
$58M Revenue
2,000 Employees
Mooyah Burgers, Fries & Shakes, a Texas-based fast casual restaurant chain that describes itself as a “better burger franchise” is looking to open up to 20 new stores in the Phoenix area.
The chain was started in 2007 in Plano, part of the Dallas-Fort Worth metroplex, and has grown significantly since then. Today there are a total of 87 locations, including 10 that are operating outside the U.S. Mooyah has restaurants in 21 states and recently just signed a multiunit franchise deal in Las Vegas marking the brand’s entrance into Nevada.
The business is completely operated by franchisees, and the Mooyah’s president, Tony Darden, told the Business Journal he’d like to get three or four different franchisees in Phoenix, all of which would open multiple locations.
“We’d love to achieve a certain penetration level right away,” Darden said.
The company has talked with a few potential Valley franchisees, but Darden referred to them just as “early discussions.”
Mooyah wants to have between 15 and 20 locations in Phoenix in the next seven to 10 years.
The total investment to open a franchised Mooyah location is between $403,750 and $639,100, along with a $40,000 franchise fee, according to the company.
Plenty of competition Darden said Mooyah’s entrance in the Phoenix market could have a significant impact on the local economy, adding 20 to 45 jobs per location, and the company’s franchisees would make a significant investment in real estate.
A Mooyah location could open in a ground-up build or take over a former restaurant space, Darden said. The company usually opens restaurants around 2,300 square feet, but there is some wiggle room.
“Flexibility is something that makes us competitive,” Darden said. “Our ideal square footage is 2,300-square-footage, but we have the ability to flex up for flex down as needed.”
The Valley is already home to a number of local, regional and national hamburger chains. Whattaburger, Farmer Boys and Eegee’s have recently started expanding into the Phoenix area.
While Mooyah’s menu items won’t be completely new to anyone, Darden said the way his company executes those products is what sets it apart.
“We are burgers, fries and shakes. We push to be the very best in each of those categories,” Darden said.
Some of the ways Mooyah’s food is better than the competitors, according to Darden, include baking its burger buns in-house, hand punching the fries every day and using real ice cream in its milkshakes.
Plano, TX
Restaurant
$58M Revenue
2,000 Employees
Mooyah Burgers, Fries & Shakes, a Texas-based fast casual restaurant chain that describes itself as a “better burger franchise” is looking to open up to 20 new stores in the Phoenix area.
The chain was started in 2007 in Plano, part of the Dallas-Fort Worth metroplex, and has grown significantly since then. Today there are a total of 87 locations, including 10 that are operating outside the U.S. Mooyah has restaurants in 21 states and recently just signed a multiunit franchise deal in Las Vegas marking the brand’s entrance into Nevada.
The business is completely operated by franchisees, and the Mooyah’s president, Tony Darden, told the Business Journal he’d like to get three or four different franchisees in Phoenix, all of which would open multiple locations.
“We’d love to achieve a certain penetration level right away,” Darden said.
The company has talked with a few potential Valley franchisees, but Darden referred to them just as “early discussions.”
Mooyah wants to have between 15 and 20 locations in Phoenix in the next seven to 10 years.
The total investment to open a franchised Mooyah location is between $403,750 and $639,100, along with a $40,000 franchise fee, according to the company.
Plenty of competition Darden said Mooyah’s entrance in the Phoenix market could have a significant impact on the local economy, adding 20 to 45 jobs per location, and the company’s franchisees would make a significant investment in real estate.
A Mooyah location could open in a ground-up build or take over a former restaurant space, Darden said. The company usually opens restaurants around 2,300 square feet, but there is some wiggle room.
“Flexibility is something that makes us competitive,” Darden said. “Our ideal square footage is 2,300-square-footage, but we have the ability to flex up for flex down as needed.”
The Valley is already home to a number of local, regional and national hamburger chains. Whattaburger, Farmer Boys and Eegee’s have recently started expanding into the Phoenix area.
While Mooyah’s menu items won’t be completely new to anyone, Darden said the way his company executes those products is what sets it apart.
“We are burgers, fries and shakes. We push to be the very best in each of those categories,” Darden said.
Some of the ways Mooyah’s food is better than the competitors, according to Darden, include baking its burger buns in-house, hand punching the fries every day and using real ice cream in its milkshakes.
Denver homebuilder set for splashy Arizona debut with huge projects, including 303 area and Surprise
The nation's ninth-largest publicly traded homebuilder is making a big splash in its Arizona debut.
Denver-based Century Communities Inc. (NYSE: CCS) quietly has been buying land in metro Phoenix and now has about 1,400 lots that will begin development this year — with more than 1,000 more lots in escrow for future development.
Eric Montgomery, who was named Phoenix division president in September 2020, said he is bullish on the Phoenix housing market.
"We've got land in escrow in Avondale, Goodyear, the Laveen area, the south Phoenix area and we're targeting more land in Maricopa, Casa Grande and up along the Loop 303 corridor," he said.
COMMERCIAL REAL ESTATE
Executive Voice: Linda Purdy, Tri Pointe Homes' first female division president
"I spent the first three months on my own buying land — being the land guy," Montgomery said. "We've been able to bring in a director of land and recently a director of construction joined us. We put out an offer for our first salesperson. Now it all seems real. We are hitting the operational stage. It's a real business at this point."
While the company's Century Complete brand has been active in the metro Phoenix market focusing on online home sales, its namesake brand — Century Communities — is being introduced to the Phoenix market with the launch of the new Phoenix division that Montgomery is leading.
Montgomery expects the first community to come out of the gate is North Copper Canyon in Surprise.
"We bought 205 finished lots, which will be our first community," he said. "We are hoping we get our first permits this week and will be starting our first homes up there."
Homes will range from 1,300 square feet to 3,100 square feet, with RV garages included on some of the larger lots, he said. Prices will start in the upper $200,000s to the mid $300,000s.
"We'll hopefully be open for sales within the next couple of months," he said.
More lots in escrow
Montgomery has another 282 lots in escrow at North Copper Canyon that he expects to close later this year.
"We will have a really significant presence in North Copper Canyon," he said.
The property is near Loop 303 and Grand Avenue, near Lennar Homes' 3,500-acre Asante master-planned community and Fulton Homes' 350-acre Escalante master-planned community.
"That submarket of Surprise is just on fire right now," Montgomery said. "All the big builders have a presence up in that area. It's just a very dynamic market right there."
Jim Belfiore, founder of Phoenix-based Belfiore Real Estate Consulting, said the supply of existing lots is dwindling in metro Phoenix.
"As ready homesite supply dwindles further, builders will be required to contract for lots that must be developed — a situation that will further constrain home supply," Belfiore said.
The nation's ninth-largest publicly traded homebuilder is making a big splash in its Arizona debut.
Denver-based Century Communities Inc. (NYSE: CCS) quietly has been buying land in metro Phoenix and now has about 1,400 lots that will begin development this year — with more than 1,000 more lots in escrow for future development.
Eric Montgomery, who was named Phoenix division president in September 2020, said he is bullish on the Phoenix housing market.
"We've got land in escrow in Avondale, Goodyear, the Laveen area, the south Phoenix area and we're targeting more land in Maricopa, Casa Grande and up along the Loop 303 corridor," he said.
COMMERCIAL REAL ESTATE
Executive Voice: Linda Purdy, Tri Pointe Homes' first female division president
"I spent the first three months on my own buying land — being the land guy," Montgomery said. "We've been able to bring in a director of land and recently a director of construction joined us. We put out an offer for our first salesperson. Now it all seems real. We are hitting the operational stage. It's a real business at this point."
While the company's Century Complete brand has been active in the metro Phoenix market focusing on online home sales, its namesake brand — Century Communities — is being introduced to the Phoenix market with the launch of the new Phoenix division that Montgomery is leading.
Montgomery expects the first community to come out of the gate is North Copper Canyon in Surprise.
"We bought 205 finished lots, which will be our first community," he said. "We are hoping we get our first permits this week and will be starting our first homes up there."
Homes will range from 1,300 square feet to 3,100 square feet, with RV garages included on some of the larger lots, he said. Prices will start in the upper $200,000s to the mid $300,000s.
"We'll hopefully be open for sales within the next couple of months," he said.
More lots in escrow
Montgomery has another 282 lots in escrow at North Copper Canyon that he expects to close later this year.
"We will have a really significant presence in North Copper Canyon," he said.
The property is near Loop 303 and Grand Avenue, near Lennar Homes' 3,500-acre Asante master-planned community and Fulton Homes' 350-acre Escalante master-planned community.
"That submarket of Surprise is just on fire right now," Montgomery said. "All the big builders have a presence up in that area. It's just a very dynamic market right there."
Jim Belfiore, founder of Phoenix-based Belfiore Real Estate Consulting, said the supply of existing lots is dwindling in metro Phoenix.
"As ready homesite supply dwindles further, builders will be required to contract for lots that must be developed — a situation that will further constrain home supply," Belfiore said.
Can employers require workers to get a Covid-19 vaccine? HR, law experts weigh in.
As health and political leaders craft strategies for distributing Covid-19 vaccines nationwide, questions about workforce implications of the rollout are top of mind for many employers.
The first and perhaps most obvious of these questions: Can I require my employees to get vaccinated? According to Diane Hoffmann, a professor at the University of Maryland School of Law, the answer is yes.
A vaccination is legally considered a medical procedure, which employers can require their employees to receive if deemed necessary to perform their jobs safely and successfully, said Hoffmann, who serves as director of the school's Law and Health Care Program. Given the highly infectious nature of Covid-19, a vaccine mandate may be considered particularly in workplaces where employees must work on site and in close proximity to one another, or in those where they interact extensively with the public.
But just because employers can legally mandate getting a coronavirus vaccination doesn't mean they all will.
There is some precedent for large-scale vaccine mandates, Hoffmann said. For example, most K-12 schools across the country require children to provide proof of certain immunizations before they can attend, and health care organizations such as hospitals and nursing homes often require their employees to get several vaccinations, including an annual flu shot.
However, vaccine mandates in other areas of private industry are relatively unprecedented. Hoffmann said some employers may worry about the legal repercussions of mandating a vaccination, including exposing themselves to a lawsuit if a certain employee has an adverse reaction to the vaccine. Additionally, employers who do opt to require their employees to be vaccinated will have to allow exceptions for people with a religious belief or medical condition that legally precludes them from receiving vaccines. Employers may have to make special accommodations for those who cannot be vaccinated if they establish a mandate.
However, there is also a risk that employees will sue if they are required to come back to a workplace without a vaccine mandate, and they end up contracting Covid-19, Hoffmann pointed out. "For a lot of businesses, this will be uncharted territory," Hoffmann said. "I expect lots of employers will be talking to their lawyers about the legal frameworks here."
The vaccine formulations being distributed are reported to be more than 90% effective, and are cleared for use under the U.S Food and Drug Administration's "emergency use authorization," a system that expedites the availability of certain health interventions during public health emergencies. Hoffmann said employers may want to wait until the vaccines have received full standard FDA approval before they consider making vaccination a job requirement.
That seems to be the route that regional health system MedStar Health is taking. MedStar CEO Kenneth Samet said although his was one of the first health systems in the country to mandate flu vaccinations for its workers, it is not requiring Covid vaccinations for now.
He discussed MedStar's approach to vaccine distribution during a panel event in December hosted by the Greater Baltimore Committee. At that point, MedStar leaders were strongly encouraging employees to get the vaccine if they can. Samet said he would be "first in line" if he were among the essential workers at the front of the distribution hierarchy, but he understands some people may be nervous about the vaccines and will want to wait until more data is in.
While employers mull their options with counsel, human resources expert Amy E. Polefrone said every employer should at least be developing a game plan for when vaccines are widely available. "These vaccines have big implications for everyone getting back to work," said Polefrone, who is CEO of Ellicott City's HR Strategy Group. "Employers should be preparing, and doing everything they can to encourage employees to get the vaccine."
Polefrone said for many companies, the Covid vaccines represent a path to getting truly back to business. She said business owners should be laying plans for how a phased return-to-work strategy might go, and maintaining open communication with their employees. She recommended employers share educational materials about vaccines and invite science and health experts to speak to workers about any questions or concerns they may have.
She also advised that business owners make the process of getting vaccinated as burden-free as possible for employees. Health insurers are expected to cover the costs of Covid vaccinations for their individual and group policy holders. But for those businesses that do not offer health benefits, Polefrone said employers may want to consider subsidizing or covering the costs of vaccinations.
Polefrone said it will take many more months before we have mostly vaccinated workforces, but she is excited to see the first steps in that direction happening. In the meantime, she said companies should expect to continue operating with mask and social distancing requirements, as well as increased cleaning schedules for the foreseeable future.
As health and political leaders craft strategies for distributing Covid-19 vaccines nationwide, questions about workforce implications of the rollout are top of mind for many employers.
The first and perhaps most obvious of these questions: Can I require my employees to get vaccinated? According to Diane Hoffmann, a professor at the University of Maryland School of Law, the answer is yes.
A vaccination is legally considered a medical procedure, which employers can require their employees to receive if deemed necessary to perform their jobs safely and successfully, said Hoffmann, who serves as director of the school's Law and Health Care Program. Given the highly infectious nature of Covid-19, a vaccine mandate may be considered particularly in workplaces where employees must work on site and in close proximity to one another, or in those where they interact extensively with the public.
But just because employers can legally mandate getting a coronavirus vaccination doesn't mean they all will.
There is some precedent for large-scale vaccine mandates, Hoffmann said. For example, most K-12 schools across the country require children to provide proof of certain immunizations before they can attend, and health care organizations such as hospitals and nursing homes often require their employees to get several vaccinations, including an annual flu shot.
However, vaccine mandates in other areas of private industry are relatively unprecedented. Hoffmann said some employers may worry about the legal repercussions of mandating a vaccination, including exposing themselves to a lawsuit if a certain employee has an adverse reaction to the vaccine. Additionally, employers who do opt to require their employees to be vaccinated will have to allow exceptions for people with a religious belief or medical condition that legally precludes them from receiving vaccines. Employers may have to make special accommodations for those who cannot be vaccinated if they establish a mandate.
However, there is also a risk that employees will sue if they are required to come back to a workplace without a vaccine mandate, and they end up contracting Covid-19, Hoffmann pointed out. "For a lot of businesses, this will be uncharted territory," Hoffmann said. "I expect lots of employers will be talking to their lawyers about the legal frameworks here."
The vaccine formulations being distributed are reported to be more than 90% effective, and are cleared for use under the U.S Food and Drug Administration's "emergency use authorization," a system that expedites the availability of certain health interventions during public health emergencies. Hoffmann said employers may want to wait until the vaccines have received full standard FDA approval before they consider making vaccination a job requirement.
That seems to be the route that regional health system MedStar Health is taking. MedStar CEO Kenneth Samet said although his was one of the first health systems in the country to mandate flu vaccinations for its workers, it is not requiring Covid vaccinations for now.
He discussed MedStar's approach to vaccine distribution during a panel event in December hosted by the Greater Baltimore Committee. At that point, MedStar leaders were strongly encouraging employees to get the vaccine if they can. Samet said he would be "first in line" if he were among the essential workers at the front of the distribution hierarchy, but he understands some people may be nervous about the vaccines and will want to wait until more data is in.
While employers mull their options with counsel, human resources expert Amy E. Polefrone said every employer should at least be developing a game plan for when vaccines are widely available. "These vaccines have big implications for everyone getting back to work," said Polefrone, who is CEO of Ellicott City's HR Strategy Group. "Employers should be preparing, and doing everything they can to encourage employees to get the vaccine."
Polefrone said for many companies, the Covid vaccines represent a path to getting truly back to business. She said business owners should be laying plans for how a phased return-to-work strategy might go, and maintaining open communication with their employees. She recommended employers share educational materials about vaccines and invite science and health experts to speak to workers about any questions or concerns they may have.
She also advised that business owners make the process of getting vaccinated as burden-free as possible for employees. Health insurers are expected to cover the costs of Covid vaccinations for their individual and group policy holders. But for those businesses that do not offer health benefits, Polefrone said employers may want to consider subsidizing or covering the costs of vaccinations.
Polefrone said it will take many more months before we have mostly vaccinated workforces, but she is excited to see the first steps in that direction happening. In the meantime, she said companies should expect to continue operating with mask and social distancing requirements, as well as increased cleaning schedules for the foreseeable future.
Maricopa tops list for talent attraction among nation's largest counties, report shows
Continued growth in skilled jobs has propelled Maricopa County to first place among large U.S. counties for talent attraction, according to a new report by labor analytics firm Emsi.
Maricopa County topped the 2020 list, with data collected right before the start of the Covid-19 pandemic, rising from second place in 2019, according to Emsi's Talent Attraction Scorecard. The county, which recorded an 18% increase in skilled jobs from 2015-19, also took the top spot in 2018 and 2017. Clark County, which is home to Las Vegas, ranked second in 2020 and Collin County, home to McKinney, Texas, ranked third.
Caifornia-based Intel Corp. is a major skilled job creator mentioned in the Emsi report. The semiconductor maker continues to grow in Chandler with a $7 billion expansion opening earlier this year and a workforce of more than 12,000.
According to the report, Phoenix is one of only a few of the largest cities in the country that is not seeing an exodus of residents. Manhattan, Brooklyn, Chicago, San Francisco and Los Angeles ranked highest for population losses from February to July 2020, with Manhattan losing 110,978 people due to moving.
Los Angeles County, the most populous county in the nation, ranked last among large counties, those with 1 million or more people, for talent attraction. Cook County, which is home to Chicago and is second largest in terms of population, placed second-to-last among large counties. Maricopa County is the country’s fourth-most populous county.
“Greater Phoenix has always been about bucking the trend,” Chris Camacho, president and CEO of the Greater Phoenix Economic Council, said. “It comes down to job creation and opportunities, plus decades of pro-business or anti-business policy.”
Continued growth in skilled jobs has propelled Maricopa County to first place among large U.S. counties for talent attraction, according to a new report by labor analytics firm Emsi.
Maricopa County topped the 2020 list, with data collected right before the start of the Covid-19 pandemic, rising from second place in 2019, according to Emsi's Talent Attraction Scorecard. The county, which recorded an 18% increase in skilled jobs from 2015-19, also took the top spot in 2018 and 2017. Clark County, which is home to Las Vegas, ranked second in 2020 and Collin County, home to McKinney, Texas, ranked third.
Caifornia-based Intel Corp. is a major skilled job creator mentioned in the Emsi report. The semiconductor maker continues to grow in Chandler with a $7 billion expansion opening earlier this year and a workforce of more than 12,000.
According to the report, Phoenix is one of only a few of the largest cities in the country that is not seeing an exodus of residents. Manhattan, Brooklyn, Chicago, San Francisco and Los Angeles ranked highest for population losses from February to July 2020, with Manhattan losing 110,978 people due to moving.
Los Angeles County, the most populous county in the nation, ranked last among large counties, those with 1 million or more people, for talent attraction. Cook County, which is home to Chicago and is second largest in terms of population, placed second-to-last among large counties. Maricopa County is the country’s fourth-most populous county.
“Greater Phoenix has always been about bucking the trend,” Chris Camacho, president and CEO of the Greater Phoenix Economic Council, said. “It comes down to job creation and opportunities, plus decades of pro-business or anti-business policy.”
New Report Shows Dramatic Floor Traffic Drops
The data is provided Gravy Analytics a market research used by leading brands to measure foot traffic and other market intelligence.
According to the Business Journal, while most businesses saw foot traffic drop dramatically in April, the fitness, hospitality and entertainment sectors are still hurting due to restrictions put on them by state governments, but with the November surge in Covid-19 cases, health officials have warned that in-person shopping could exacerbate the spread of the virus.
Gravy Analytics' latest data was compiled from February, before shutdowns were put in place, through mid-November by aggregating billions of location records collected through mobile phone applications for national brands. In fact, Gravy Analytics tracks consumer foot traffic changes for 200 leading brands across 50 major cities, including Phoenix.
According to its latest data, Hyatt Regency in downtown Phoenix saw the biggest decrease in foot traffic — a whopping 93% drop — since February. This makes sense as the Hyatt Regency is convention hotel and with no major events happening, the number of hotel guests has dwindled.
Movie theater chain AMC Theaters has seen foot traffic decrease 92% since February, and boutique fitness studio Orangetheory Fitness is down 90%, according to Gravy.
The data is provided Gravy Analytics a market research used by leading brands to measure foot traffic and other market intelligence.
According to the Business Journal, while most businesses saw foot traffic drop dramatically in April, the fitness, hospitality and entertainment sectors are still hurting due to restrictions put on them by state governments, but with the November surge in Covid-19 cases, health officials have warned that in-person shopping could exacerbate the spread of the virus.
Gravy Analytics' latest data was compiled from February, before shutdowns were put in place, through mid-November by aggregating billions of location records collected through mobile phone applications for national brands. In fact, Gravy Analytics tracks consumer foot traffic changes for 200 leading brands across 50 major cities, including Phoenix.
According to its latest data, Hyatt Regency in downtown Phoenix saw the biggest decrease in foot traffic — a whopping 93% drop — since February. This makes sense as the Hyatt Regency is convention hotel and with no major events happening, the number of hotel guests has dwindled.
Movie theater chain AMC Theaters has seen foot traffic decrease 92% since February, and boutique fitness studio Orangetheory Fitness is down 90%, according to Gravy.
Restaurants
Hotels
Retailers
Phoenix Business Journals Releases a Special Report
Undersupply drives demand for logistics space in the entire metro area
The industrial logistics space in the Loop 303 corridor in Glendale and Goodyear is expected to grow by more than 200%, from 15 million square feet to 50 million square feet in the next five to six years.
“The Loop 303 corridor is the place that offers development and employment land site solutions,” said Tony Lydon, managing director of Jones Lang LaSalle Inc. in Phoenix.
Land that is zoned or can be rezoned for industrial uses is limited in the metro, so readily available spaces in the West Valley are highly desirable, he said. Plus, companies already in that part of the region need to scale, and the need for additional industrial space already exists.
While demand for industrial space was growing prior to the Covid-19 pandemic, the explosive rise of e-commerce and the strain on the supply chain over the past eight months has put fuel to the fire.
Due to increased e-commerce demand, by 2025 the U.S. will need more than 1 billion square feet of industrial space, which would mean the top submarkets, Phoenix included, would need 6.5 to 7 million square feet of new space per year for the next five years to keep up with the demand, Lydon said.
Tony Lydon, managing director of JLL in Phoenix, said the average market has 88 square feet of industrial space per capita, but Phoenix only has 58 square feet per capita, meaning that even during record-high industrial construction, there is still a need for more space.
“Phoenix has historically been underserved,” Lydon said. “But, with re-shoring, I think Phoenix will be a winner.”
Amazon leads the way
E-commerce giant Amazon Inc. announced massive expansion plans in Phoenix this year, and by 2021 will be the largest employers with with nearly 3,000 employees in Goodyear alone and 20,500 in total across the Valley.
Matthew High, regional director of fulfillment for Amazon, said the talent and workforce in the Phoenix area has been consistently strong. “The workforce, community partners, an abundance of talent and being close to our customers are some of the contributing factors to site selection,” he said.
Undersupply drives demand for logistics space in the entire metro area
The industrial logistics space in the Loop 303 corridor in Glendale and Goodyear is expected to grow by more than 200%, from 15 million square feet to 50 million square feet in the next five to six years.
“The Loop 303 corridor is the place that offers development and employment land site solutions,” said Tony Lydon, managing director of Jones Lang LaSalle Inc. in Phoenix.
Land that is zoned or can be rezoned for industrial uses is limited in the metro, so readily available spaces in the West Valley are highly desirable, he said. Plus, companies already in that part of the region need to scale, and the need for additional industrial space already exists.
While demand for industrial space was growing prior to the Covid-19 pandemic, the explosive rise of e-commerce and the strain on the supply chain over the past eight months has put fuel to the fire.
Due to increased e-commerce demand, by 2025 the U.S. will need more than 1 billion square feet of industrial space, which would mean the top submarkets, Phoenix included, would need 6.5 to 7 million square feet of new space per year for the next five years to keep up with the demand, Lydon said.
Tony Lydon, managing director of JLL in Phoenix, said the average market has 88 square feet of industrial space per capita, but Phoenix only has 58 square feet per capita, meaning that even during record-high industrial construction, there is still a need for more space.
“Phoenix has historically been underserved,” Lydon said. “But, with re-shoring, I think Phoenix will be a winner.”
Amazon leads the way
E-commerce giant Amazon Inc. announced massive expansion plans in Phoenix this year, and by 2021 will be the largest employers with with nearly 3,000 employees in Goodyear alone and 20,500 in total across the Valley.
Matthew High, regional director of fulfillment for Amazon, said the talent and workforce in the Phoenix area has been consistently strong. “The workforce, community partners, an abundance of talent and being close to our customers are some of the contributing factors to site selection,” he said.
SBA Ordered to Release PPP Loan Details
The Small Business Administration is being ordered to release more detailed Paycheck Protection Program loan information — and experts say that could deter fraud and abuse in a future round of PPP loans approved by Congress.
That transparency, which comes in the form of a federal judge ordering the agency to release more details by Nov. 19 absent an appeal, might have a chilling effect on small businesses applying to any future programs, but would help deter future fraud in any new round, said Tenley Carp, a partner at law firm Arnall Golden Gregory.
“The publication of names and PPP loan amounts might very well have a chilling effect on PPP applications during a second round, but I don’t think that is necessarily a bad thing,” Carp said in an email, adding private businesses might not want anyone to know they needed help. “I think the obvious good that public disclosure would do to prevent fraud and abuse in the PPP outweighs even that very legitimate concern.”
And that fraud in the $525 billion that went out in more than 5.2 million loans appears to be widespread, according to a recent Wall Street Journal report. The Government Accountability Office also weighed in with an Oct. 1 report that the program was ripe for abuse, and Thompson Reuters said that recent reporting showed that $4 billion in PPP loans had already been flagged for such abuse.
“If people know up front their names and PPP loan amounts will be 'public knowledge,' that might very well reduce the number of individuals and/or companies committing some form of fraud to obtain PPP funds,” Carp said.
In July, the SBA released data on PPP loans above $150,000, as well as information about the lenders who made them. But it argued in legal filings that detailed information about loans should not be made public, citing federal laws that exempt some government records from disclosure, such as trade secrets and personnel and medical files. The ordered disclosure would include names of businesses that received smaller loans, and exact amounts for larger loans, which had been disclosed as ranges of dollar amounts.
The Small Business Administration is being ordered to release more detailed Paycheck Protection Program loan information — and experts say that could deter fraud and abuse in a future round of PPP loans approved by Congress.
That transparency, which comes in the form of a federal judge ordering the agency to release more details by Nov. 19 absent an appeal, might have a chilling effect on small businesses applying to any future programs, but would help deter future fraud in any new round, said Tenley Carp, a partner at law firm Arnall Golden Gregory.
“The publication of names and PPP loan amounts might very well have a chilling effect on PPP applications during a second round, but I don’t think that is necessarily a bad thing,” Carp said in an email, adding private businesses might not want anyone to know they needed help. “I think the obvious good that public disclosure would do to prevent fraud and abuse in the PPP outweighs even that very legitimate concern.”
And that fraud in the $525 billion that went out in more than 5.2 million loans appears to be widespread, according to a recent Wall Street Journal report. The Government Accountability Office also weighed in with an Oct. 1 report that the program was ripe for abuse, and Thompson Reuters said that recent reporting showed that $4 billion in PPP loans had already been flagged for such abuse.
“If people know up front their names and PPP loan amounts will be 'public knowledge,' that might very well reduce the number of individuals and/or companies committing some form of fraud to obtain PPP funds,” Carp said.
In July, the SBA released data on PPP loans above $150,000, as well as information about the lenders who made them. But it argued in legal filings that detailed information about loans should not be made public, citing federal laws that exempt some government records from disclosure, such as trade secrets and personnel and medical files. The ordered disclosure would include names of businesses that received smaller loans, and exact amounts for larger loans, which had been disclosed as ranges of dollar amounts.
New Fintech Platform For Companies Seeking Investors
A new financial technology company currently in its beta phase is positioning itself as the Match.com for private companies looking to raise capital, according to its founder.
WealthVP, founded by entrepreneur Leif Hartwig, raised over $500,000 from private investors in a seed funding round that closed at the end of September to build the software as a service platform that matches qualified companies — software and sustainability companies to start — with family office investors from all over the world. Hartwig declined to comment about a second funding round.
Accepting applicants
WealthVP is currently accepting applications from 100 qualified companies and at least 25 purpose-driven family offices that are a good match for those companies during the beta phase through the end of 2020, Hartwig said. The official launch date is Jan. 2.
The said he hopes most of the first 100 companies will be based in Arizona.
Qualified companies are required to be generating revenue, have a total addressable market in the world of $100 million, have already received some funding and are seeking at least $1 million in new funding. The companies must submit an executive summary of the business, a pitch book, pro forma and a video to be posted on WealthVP.
Because of the disparity in funding, WealthVP is guaranteeing 25% to 30% of the companies selected to be on WealthVP will be women, veteran and minority founded.
Hartwig, who also serves as WealthVP’s CEO, said he came up with the concept for his new company after realizing that the $2 trillion spent by investors each year in funding businesses is all done through word of mouth and pitch contests.
“In the U.S. alone, hundreds of thousands of cutting-edge companies need capital investment to fully realize market potential,” he said. “Less than 10% will be fully funded, and most will fail due to lack of capital. Through WealthVP, we’re making it easy for world-bettering companies and family office investors to find one another.”
The need is especially critical in Arizona.
“I believe we are one of the top three states in the country for startups, however, we have almost no venture capital money in town,” Hartwig said.
This means many startups won’t get the investor funding they need, or they will get funding from an out-of-state investor and may get asked to relocate the company, he said.
“We truly need this national and international investor community that can see these companies that we have in Arizona,” he said.
The CEO of Phoenix business accelerator Coplex agreed.
"One of the biggest barriers to growth for promising early-stage companies is raising capital,” Brenda Schmidt, CEO of Coplex, said in a statement. “WealthVP reduces the time and complexity of raising funds for founders and reduces the risk of finding qualified startups of investors. This is a game-changer."
WealthVP’s internal advisory board vets any company looking to be on the platform to make sure they meet the minimum qualifications. An analytics firm will then verify the information provided by the applicants.
Once accepted onto WealthVP, companies and investors are matched through the platform’s proprietary algorithm, Hartwig said. Either side can also search for entities by location, financial needs or investment goals, type of company and more. Once a match is made, investors control the conversation and can reach out directly to the companies they are interested in via a secure messaging tool, according to WealthVP.
'The industry needs us'Hartwig said WealthVP doesn't ask for a percentage of the companies seeking investors. Companies will pay to be on the WealthVP platform on a monthly basis.
Next year, he said he expects WealthVP will open the platform to more accredited investors and private companies in varying sectors.
“We want to grow the company to significant value, but we are grounded in values," Hartwig said. "The industry needs us, needs companies like us."
A new financial technology company currently in its beta phase is positioning itself as the Match.com for private companies looking to raise capital, according to its founder.
WealthVP, founded by entrepreneur Leif Hartwig, raised over $500,000 from private investors in a seed funding round that closed at the end of September to build the software as a service platform that matches qualified companies — software and sustainability companies to start — with family office investors from all over the world. Hartwig declined to comment about a second funding round.
Accepting applicants
WealthVP is currently accepting applications from 100 qualified companies and at least 25 purpose-driven family offices that are a good match for those companies during the beta phase through the end of 2020, Hartwig said. The official launch date is Jan. 2.
The said he hopes most of the first 100 companies will be based in Arizona.
Qualified companies are required to be generating revenue, have a total addressable market in the world of $100 million, have already received some funding and are seeking at least $1 million in new funding. The companies must submit an executive summary of the business, a pitch book, pro forma and a video to be posted on WealthVP.
Because of the disparity in funding, WealthVP is guaranteeing 25% to 30% of the companies selected to be on WealthVP will be women, veteran and minority founded.
Hartwig, who also serves as WealthVP’s CEO, said he came up with the concept for his new company after realizing that the $2 trillion spent by investors each year in funding businesses is all done through word of mouth and pitch contests.
“In the U.S. alone, hundreds of thousands of cutting-edge companies need capital investment to fully realize market potential,” he said. “Less than 10% will be fully funded, and most will fail due to lack of capital. Through WealthVP, we’re making it easy for world-bettering companies and family office investors to find one another.”
The need is especially critical in Arizona.
“I believe we are one of the top three states in the country for startups, however, we have almost no venture capital money in town,” Hartwig said.
This means many startups won’t get the investor funding they need, or they will get funding from an out-of-state investor and may get asked to relocate the company, he said.
“We truly need this national and international investor community that can see these companies that we have in Arizona,” he said.
The CEO of Phoenix business accelerator Coplex agreed.
"One of the biggest barriers to growth for promising early-stage companies is raising capital,” Brenda Schmidt, CEO of Coplex, said in a statement. “WealthVP reduces the time and complexity of raising funds for founders and reduces the risk of finding qualified startups of investors. This is a game-changer."
WealthVP’s internal advisory board vets any company looking to be on the platform to make sure they meet the minimum qualifications. An analytics firm will then verify the information provided by the applicants.
Once accepted onto WealthVP, companies and investors are matched through the platform’s proprietary algorithm, Hartwig said. Either side can also search for entities by location, financial needs or investment goals, type of company and more. Once a match is made, investors control the conversation and can reach out directly to the companies they are interested in via a secure messaging tool, according to WealthVP.
'The industry needs us'Hartwig said WealthVP doesn't ask for a percentage of the companies seeking investors. Companies will pay to be on the WealthVP platform on a monthly basis.
Next year, he said he expects WealthVP will open the platform to more accredited investors and private companies in varying sectors.
“We want to grow the company to significant value, but we are grounded in values," Hartwig said. "The industry needs us, needs companies like us."
El Mirage to Get First New Home Development in Years
Two land deals recently closed in El Mirage!
Scottsdale-based Meritage Homes Corp. (NYSE: MTH) paid $5.45 million for a 24-acre parcel, while Phoenix-based NexMetro Communities paid $5.9 million for a 32-acre parcel, according to Vizzda LLC, a Tempe-based real estate database.
Meritage purchased its parcel at the northeast corner of Williams Drive and El Mirage Road from Kimco Realty Corp. and De Rito Partners, while NexMetro bought its parcel from an entity tracing to Herb Dreiseszun, according to Vizzda.
Meritage's parcel is called Camino Crossing, which has 123 lots sized 45 feet by 115 feet. Brian Rosella, broker with Kidder Matthews, represented Meritage.
Plans call for building single-story homes starting at 1,500 square feet, with prices starting under $300,000, said Fred Hermann, Phoenix division president for Meritage. A variety of home designs will range up to 2,500 square feet for two-story homes.
"The West Valley is an exciting market for Meritage to open a new community," Hermann said. "With recent price appreciation it is difficult to find a new home at entry-level pricing."
Camino Crossing will be the first new home development in El Mirage in years, said Jim Belfiore, founder of Belfiore Real Estate Consulting in Phoenix. "With no new supply and little resale supply to be had in the immediate area, Meritage Homes is likely to wish it had more than the 123 homes the builder has to offer," Belfiore said. "Meritage has become a go-to metro Phoenix area turnkey homebuilder offering home shoppers a one-stop shop for their piece of the American dream."
Belfiore said he expects Meritage to find instant success at Camino Crossing, similar to its success at Ellison Trails in Laveen, where Meritage sold 30 homes in the first 30 days of offering them.
At the same time, NexMetro's move into supply-constrained, affordable El Mirage just makes sense, Belfiore said.
"The area has had no new rental product, and as such, lease-up is likely to be rapid," he said.
By Angela Gonzales – Senior Reporter, Phoenix Business Journal
Oct 7, 2020, 1:00pm EDT
Two land deals recently closed in El Mirage!
Scottsdale-based Meritage Homes Corp. (NYSE: MTH) paid $5.45 million for a 24-acre parcel, while Phoenix-based NexMetro Communities paid $5.9 million for a 32-acre parcel, according to Vizzda LLC, a Tempe-based real estate database.
Meritage purchased its parcel at the northeast corner of Williams Drive and El Mirage Road from Kimco Realty Corp. and De Rito Partners, while NexMetro bought its parcel from an entity tracing to Herb Dreiseszun, according to Vizzda.
Meritage's parcel is called Camino Crossing, which has 123 lots sized 45 feet by 115 feet. Brian Rosella, broker with Kidder Matthews, represented Meritage.
Plans call for building single-story homes starting at 1,500 square feet, with prices starting under $300,000, said Fred Hermann, Phoenix division president for Meritage. A variety of home designs will range up to 2,500 square feet for two-story homes.
"The West Valley is an exciting market for Meritage to open a new community," Hermann said. "With recent price appreciation it is difficult to find a new home at entry-level pricing."
Camino Crossing will be the first new home development in El Mirage in years, said Jim Belfiore, founder of Belfiore Real Estate Consulting in Phoenix. "With no new supply and little resale supply to be had in the immediate area, Meritage Homes is likely to wish it had more than the 123 homes the builder has to offer," Belfiore said. "Meritage has become a go-to metro Phoenix area turnkey homebuilder offering home shoppers a one-stop shop for their piece of the American dream."
Belfiore said he expects Meritage to find instant success at Camino Crossing, similar to its success at Ellison Trails in Laveen, where Meritage sold 30 homes in the first 30 days of offering them.
At the same time, NexMetro's move into supply-constrained, affordable El Mirage just makes sense, Belfiore said.
"The area has had no new rental product, and as such, lease-up is likely to be rapid," he said.
By Angela Gonzales – Senior Reporter, Phoenix Business Journal
Oct 7, 2020, 1:00pm EDT
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Eight of America’s 400 Richest Live in Arizona!
It still takes at least $2.1 billion, unchanged for the past three years, to make the Forbes cut! Even in these trying times mega-fortunes are still being minted. This year there are 18 new members to the ranks, and eight of the richest people who made their piles in everything from electric trucks to the now-ubiquitous Zoom.
According to the Phoenix Business Journal here are the Eight for Arizona:
Carvana founder Ernest Garcia II and his son, Carvana CEO and co-founder Earnest Garcia III were the wealthiest, with net worths of $9.6 billion and $4.2 billion, respectively. That’s a jump from $5.7 billion and $2.3 billion, respectively, in 2019.
Anaheim Angels owner Arturo Moreno rounded out the top three in Arizona, coming in at No. 238 in the nation with a net worth of $3.4 billion, up from $3.3 billion in 2019, an amount that was enough to make him the richest Arizonan on Forbes’ April list of the richest people in the world, where he ranked No. 590.
The Arizona cohort included one newcomer: Trevor Milton, the founder and former executive chairman of zero-emissions vehicle maker Nikola Corp. which went public at the beginning of June as part of a reverse-merger with
The net worth of Bennett Dorrance, who owns a 15% stake in Campbell Soup, went from $2.8 billion in 2019 to $3 billion this year, landing at No. 278 on Forbes’ list. Dorrance is the grandson of John T. Dorrance, who invented condensed soup.
The three other Arizonans on Forbes’ list saw their wealth decline since 2019.
Mark Shoen, who owns about a fifth of U-Haul parent company Amerco, had a drop from $3.3 billion in 2019 to $2.7 billion in 2020.
Joe Shoen, the president and chairman and 21% stakeholder of Amerco, had a net worth drop from $2.7 billion in 2019 to $2.3 billion in 2020. Mark Shoen ranked 319th on Forbes’ list and E. Joe Shoen ranked 359th.
Bob Parsons, the founder of web hosting firm GoDaddy who has since sold his stake in the company and retired from the board, saw a net worth drop from $2.7 billion in 2019 to $2.2 billion in 2020, ranking him No. 378 among the nation’s wealthiest.
Jerry Moyes, the founder of Swift Transportation, now part of Knight-Swift Transportation Holdings Inc., had made the grade when Forbes released its annual list of the world's wealthiest people in March of this year when he had a net worth of $1.2 billion, but fell off the latest ranking
Forbes used stock prices from July 24 in its calculations of wealth.
It still takes at least $2.1 billion, unchanged for the past three years, to make the Forbes cut! Even in these trying times mega-fortunes are still being minted. This year there are 18 new members to the ranks, and eight of the richest people who made their piles in everything from electric trucks to the now-ubiquitous Zoom.
According to the Phoenix Business Journal here are the Eight for Arizona:
Carvana founder Ernest Garcia II and his son, Carvana CEO and co-founder Earnest Garcia III were the wealthiest, with net worths of $9.6 billion and $4.2 billion, respectively. That’s a jump from $5.7 billion and $2.3 billion, respectively, in 2019.
Anaheim Angels owner Arturo Moreno rounded out the top three in Arizona, coming in at No. 238 in the nation with a net worth of $3.4 billion, up from $3.3 billion in 2019, an amount that was enough to make him the richest Arizonan on Forbes’ April list of the richest people in the world, where he ranked No. 590.
The Arizona cohort included one newcomer: Trevor Milton, the founder and former executive chairman of zero-emissions vehicle maker Nikola Corp. which went public at the beginning of June as part of a reverse-merger with
The net worth of Bennett Dorrance, who owns a 15% stake in Campbell Soup, went from $2.8 billion in 2019 to $3 billion this year, landing at No. 278 on Forbes’ list. Dorrance is the grandson of John T. Dorrance, who invented condensed soup.
The three other Arizonans on Forbes’ list saw their wealth decline since 2019.
Mark Shoen, who owns about a fifth of U-Haul parent company Amerco, had a drop from $3.3 billion in 2019 to $2.7 billion in 2020.
Joe Shoen, the president and chairman and 21% stakeholder of Amerco, had a net worth drop from $2.7 billion in 2019 to $2.3 billion in 2020. Mark Shoen ranked 319th on Forbes’ list and E. Joe Shoen ranked 359th.
Bob Parsons, the founder of web hosting firm GoDaddy who has since sold his stake in the company and retired from the board, saw a net worth drop from $2.7 billion in 2019 to $2.2 billion in 2020, ranking him No. 378 among the nation’s wealthiest.
Jerry Moyes, the founder of Swift Transportation, now part of Knight-Swift Transportation Holdings Inc., had made the grade when Forbes released its annual list of the world's wealthiest people in March of this year when he had a net worth of $1.2 billion, but fell off the latest ranking
Forbes used stock prices from July 24 in its calculations of wealth.
Lagoon Water Park, Entertainment Venue Headed to West Valley.... A new regional tourism asset for the NW Valley!
A beach party in Arizona might not be such a wacky idea in a couple of years because the West Valley will soon be home to an 11-acre beach lagoon, planned to include scuba diving, windsurfing and water jet packs as part of a 48-acre entertainment destination. TV News Story The planned project be near the Westgate Entertainment, near E 95th Avenue and Cardinals Way, near the State Farm Stadium. The developer of the project is ECL Glendale LLC. Crystal Lagoons Island Resort, will have a similar feeling to Downtown Disney, with experiential retail, amusement park rides, a 4D theater, a themed hotel and other hotel uses on the site. The project will also include an “aero bar,” a bar in the middle of the lagoon on a vertical structure that becomes elevated 135 feet in the air so patrons can get a 360-degree view. It also will include the world’s largest helium balloon. The balloon will be on a tether with a gondola that raises riders 400 feet in the air. The 4D theater will incorporate sensory elements like smell, temperature or moisture into the viewers’ experience. The theater will be in conjunction with SimEx-Iwerks Entertainment, which has access to Disney proprietary character and products. |
Industrial Construction Report
Phoenix is on track for a record level of new industrial supply to be completed in 2020, but so far new supply has outpaced demand, according to CoStar research. According to data compiled by Jessica Morin, director of market analytics for CoStar “Phoenix ranks ninth for U.S. markets with the most industrial space under construction. When the space under construction is completed, it will expand the market’s existing stock by 3.1%. That being said, Glendale and Goodyear have the most space under construction as compared to their existing space. Glendale will add about 40% to its inventory and Goodyear will add about 20% when the space under construction is completed. Nationwide, industrial net absorption was forecast to remain negative through the remainder of 2020 and into the beginning of 2021, according to a study done by NAIOP. However, Arizona has not seen the steep decline some other markets have suffered, Suzanne Kinney, president and CEO of the Arizona chapter of NAIOP said. “There have been a handful of large deals that have gone our way,” Kinney said, adding that several manufacturers have recently moved or expanded in Phoenix recently, and users like food and beverage makers are also growing in the area. Some of the growth, such as the pivot by Honeywell in Phoenix to make personal protective equipment, were directly related to the Covid-19 pandemic, Kinney said, but other moves were “a continuation of the positive trends we’ve seen over the past few years.” |
Arizona Supreme Court refuses to take up lawsuit from bar
According to the Phoenix Business Journal
08-26-2020
The Arizona Supreme Court has denied hearing a lawsuit filed by more than 100 bar owners against Gov. Doug Ducey over the manner in which he closed bars down this summer.
The growing group of bar owners took the matter straight to the state’s highest court, but Supreme Court Chief Justice Robert Brutinel wrote in the Aug. 25 order that the issue should first be reviewed by a lower court.
The ruling seems to be based more on procedure than the content of the lawsuit.
Ilan Wurman, the attorney representing the bar owners and a law professor at Arizona State University, has already filed another suit in Arizona Superior Court.
In the lawsuit, Wurman and the bar owners argued that Ducey’s order to close down bars to slow the spread of Covid-19 did not actually close down all bars in the state, but targeted just the owners with series 6 or 7 liquor licenses.
Under Ducey’s executive order hotel bars, casino bars, microbreweries, wineries, private clubs, distilleries and restaurants with bars were allowed to stay open because they operate with a different series of liquor licenses.
Wurman argues that the distinction between liquor license series has nothing to do with public health.
Besides asking for the court to deem Ducey’s executive order unlawful, the lawsuit is seeking damages for bar owners including for revenue that was lost when these businesses were forced to close but competitors could stay open.
According to the Phoenix Business Journal
08-26-2020
The Arizona Supreme Court has denied hearing a lawsuit filed by more than 100 bar owners against Gov. Doug Ducey over the manner in which he closed bars down this summer.
The growing group of bar owners took the matter straight to the state’s highest court, but Supreme Court Chief Justice Robert Brutinel wrote in the Aug. 25 order that the issue should first be reviewed by a lower court.
The ruling seems to be based more on procedure than the content of the lawsuit.
Ilan Wurman, the attorney representing the bar owners and a law professor at Arizona State University, has already filed another suit in Arizona Superior Court.
In the lawsuit, Wurman and the bar owners argued that Ducey’s order to close down bars to slow the spread of Covid-19 did not actually close down all bars in the state, but targeted just the owners with series 6 or 7 liquor licenses.
Under Ducey’s executive order hotel bars, casino bars, microbreweries, wineries, private clubs, distilleries and restaurants with bars were allowed to stay open because they operate with a different series of liquor licenses.
Wurman argues that the distinction between liquor license series has nothing to do with public health.
Besides asking for the court to deem Ducey’s executive order unlawful, the lawsuit is seeking damages for bar owners including for revenue that was lost when these businesses were forced to close but competitors could stay open.
According the the Phoenix Business Journal
Nine Arizona companies, all of them based in the Valley, made the cut for Inc. magazine’s list of the top 500 fastest-growing firms in the nation for 2020.
Topping the state list was last year’s national leader and Inc.’s 2019 cover story, Freestar LLC, a company that helps publishers boost revenue by optimizing their online advertising. This year, Freestar dropped to No. 36 overall on a still-staggering growth rate of 7,239%.
The Inc. 500 is the top tier of the larger Inc. 5000 list, which ranks the 5,000 fastest-growing, privately held U.S. companies.
Counting the nine Arizona companies on the Inc. 500, the state had 107 companies on the full Inc. 5000 list. This is up from the 104 that made the list last year.
Here are the nine companies that made the upper tier of the Inc. 5000 to land a ranking in the 2020 Inc. 500:
- No. 36, Freestar, Phoenix, 7,239% growth
- No. 148, Handwrytten, Phoenix, 2,572%
- No. 196, CellTrust Corp., Scottsdale, 2,145%
- No. 210, Attribytes, Chandler, 2,062%
- No. 258, Maverick Performance Products, Chandler, 1,724%
- No. 319, Simple Living Solutions, Scottsdale, 1,421%
- No. 337, Titan Solar Power, Mesa, 1,348%
- No. 432, Exerscribe, Scottsdale, 1,064%
- No. 448, Centauri Health Solutions, Scottsdale, 1,019%
Landlords sue, say Ducey lacks authority to stop evictions
According to the Arizona Capitol Times Landlords and mobile home park owners from around the state are asking the Arizona Supreme Court to void an executive order by Gov. Doug Ducey blocking evictions of tenants who do not pay their rent.
The lawsuit claims the governor lacks the constitutional authority to tell constables around the state not to process eviction orders, even those issued legally by judges. It also contends that the gubernatorial directive is violating both the property rights of landowners as well as their right to enter into contracts.
In seeking review, the lawsuit acknowledges that the governor can exercise certain powers in a public health emergency. But attorney Kory Langhofer, who prepared the legal filing, said that Ducey, in unilaterally barring landlords from enforcing the terms of lawful lease agreements, created “an indefinite economic welfare and redistribution program, rather than a public health measure to contain the COVID-19 contagion.”
According to the Arizona Capitol Times Landlords and mobile home park owners from around the state are asking the Arizona Supreme Court to void an executive order by Gov. Doug Ducey blocking evictions of tenants who do not pay their rent.
The lawsuit claims the governor lacks the constitutional authority to tell constables around the state not to process eviction orders, even those issued legally by judges. It also contends that the gubernatorial directive is violating both the property rights of landowners as well as their right to enter into contracts.
In seeking review, the lawsuit acknowledges that the governor can exercise certain powers in a public health emergency. But attorney Kory Langhofer, who prepared the legal filing, said that Ducey, in unilaterally barring landlords from enforcing the terms of lawful lease agreements, created “an indefinite economic welfare and redistribution program, rather than a public health measure to contain the COVID-19 contagion.”
PPP Loans helped nearly 1,500 local businesses
A new Surprise Regional Chamber of Commerce report showed almost 1,500 small businesses in the Northwest Valley have received $155 million in PPP loan assistance.
Based the Chamber’s latest data, the PPP loans helped to retain 6,879 workers in the region (El Mirage, Sun City, Sun City West, Surprise, Waddell and Youngtown.) However, several small businesses in Surprise and surrounding areas are still suffering from the COVID-19 slowdown and waiting for Congress to act on additional bailout money.
“When the previous bailout programs were rolled out there was much confusion and turbulence, and small businesses did not initially fair well,” Chamber President and CEO Raoul Sada said. “The Chamber wants to do its part, making sure that does not happen again, and we are lobbying Capitol Hill for a packages that favor small businesses.”
Key Points:
•The SBA has just released a massive trove of data on PPP loans. This was a significant step forward in transparency by the government, prior to this the SBA resisted requests to share the recipients of the funds. This is why it is so important for the Chamber to hold government officials accountable, and for us to demand transparency at all levels of government (local, state and federal!)
•More than 81,000 Arizona businesses and nonprofits have received forgivable loans through the federal government's Paycheck Protection Program totaling $8.6 billion, according to the U.S. Small Business Administration.
•The Paycheck Protection Program, which was designed to avert mass layoffs during the Covid-19 pandemic.
•PPP loans are not made by SBA. PPP loans are made by lending institutions and then guaranteed by SBA.
•According to the data, 58 businesses in Arizona received between $5 and $10 million, the maximum amount allowed under the program. But the vast majority of loans, approximately 86%, are valued under $150,000.
•Close to 1500 small businesses received PPP loans in the six cities that make up the Chambers service territory. The amount of cash infused into our local economy was over $154 million dollars! Based on application data, the loans help to retain 6,879 workers in our region.
•Approximately 42 businesses were non-profits (2.8% of the recipients)
Based the Chamber’s latest data, the PPP loans helped to retain 6,879 workers in the region (El Mirage, Sun City, Sun City West, Surprise, Waddell and Youngtown.) However, several small businesses in Surprise and surrounding areas are still suffering from the COVID-19 slowdown and waiting for Congress to act on additional bailout money.
“When the previous bailout programs were rolled out there was much confusion and turbulence, and small businesses did not initially fair well,” Chamber President and CEO Raoul Sada said. “The Chamber wants to do its part, making sure that does not happen again, and we are lobbying Capitol Hill for a packages that favor small businesses.”
Key Points:
•The SBA has just released a massive trove of data on PPP loans. This was a significant step forward in transparency by the government, prior to this the SBA resisted requests to share the recipients of the funds. This is why it is so important for the Chamber to hold government officials accountable, and for us to demand transparency at all levels of government (local, state and federal!)
•More than 81,000 Arizona businesses and nonprofits have received forgivable loans through the federal government's Paycheck Protection Program totaling $8.6 billion, according to the U.S. Small Business Administration.
•The Paycheck Protection Program, which was designed to avert mass layoffs during the Covid-19 pandemic.
•PPP loans are not made by SBA. PPP loans are made by lending institutions and then guaranteed by SBA.
•According to the data, 58 businesses in Arizona received between $5 and $10 million, the maximum amount allowed under the program. But the vast majority of loans, approximately 86%, are valued under $150,000.
•Close to 1500 small businesses received PPP loans in the six cities that make up the Chambers service territory. The amount of cash infused into our local economy was over $154 million dollars! Based on application data, the loans help to retain 6,879 workers in our region.
•Approximately 42 businesses were non-profits (2.8% of the recipients)
Surprise Independent News Coverage
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See What Businesses are Open and Their COVID-19 Safeguards Based on a self -reported survey, as on 05/11/2020. Information is subject to change without notice. The collection and dissemination of the data was a combined effort between the City of Surprise and the Surprise Regional Chamber of Commerce. ShopSurprise Receive Special Deals, Promotions and Community Messages from Local Merchants, and your Chamber of Commerce. All messages are sent Directly to Your Phone! Get advance notice of new restaurants, grand openings, community events and more. It's FREE! Enroll Now |
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Chamber’s NW Valley COVID-19 Consumer Survey Results Are In
Survey Results Make the Paper-Click Here to Read the Article Consumers, not the government, will ultimately decide when the economy will open—that is why it is important for citizens and businesses to know what people are thinking. Please share your comments on our Facebook page! Government leaders and public health officials will make decisions, and issue guidance on when we return to work, but truly regaining some semblance of normalcy will be determined by how people feel and what motivates them to act or not act. The Chambers recent survey sheds more light about what consumers are thinking in the NW Valley . Share your comments on our Facebook page Take Our 1-Minute Survey |
Business COVID-19 Survey Results
Survey Makes Front Page of Surprise Independent- Read the Story
CEOs across the globe are coming to terms with the reality that business will be anything but normal over the coming months as the impact of the coronavirus pandemic continues to escalate.
But while revenues are set to suffer a short-term hit, the majority of leaders remain confident that their companies will be back on solid footing within the year, according to a new study on the business impact of the outbreak of COVID-19.
The survey results found that 82% of business leaders expect declines in revenues over the next six months, but more than half (54%) anticipate revenues will be back to normal in a year’s time. And 61% of CEOs expect their total fixed investments to remain unchanged year on year.
How Business Owners are Responding
Among the industries seeing the greatest impact from the fallout are hospitality and travel (89%), education (87%) and media and entertainment (80%). Meanwhile, production firms in agriculture, factories, mines and utilities reported some uptick in revenues.
Nevertheless, business leaders across the board (95%) said they’re taking new measures curb the impact of the virus. That includes communicating more regularly with employees (68%), adopting new health and safety procedures (67%), cancelling major events (64%) and halting business travel (53%).
Meanwhile, other respondents, when asked for their advice for business leaders, recommended the following:
Citation: The Survey was conducted by YPO a global leadership community of more than 29,000 chief executives in 130 countries. Full Press Release
Survey Makes Front Page of Surprise Independent- Read the Story
CEOs across the globe are coming to terms with the reality that business will be anything but normal over the coming months as the impact of the coronavirus pandemic continues to escalate.
But while revenues are set to suffer a short-term hit, the majority of leaders remain confident that their companies will be back on solid footing within the year, according to a new study on the business impact of the outbreak of COVID-19.
The survey results found that 82% of business leaders expect declines in revenues over the next six months, but more than half (54%) anticipate revenues will be back to normal in a year’s time. And 61% of CEOs expect their total fixed investments to remain unchanged year on year.
How Business Owners are Responding
Among the industries seeing the greatest impact from the fallout are hospitality and travel (89%), education (87%) and media and entertainment (80%). Meanwhile, production firms in agriculture, factories, mines and utilities reported some uptick in revenues.
Nevertheless, business leaders across the board (95%) said they’re taking new measures curb the impact of the virus. That includes communicating more regularly with employees (68%), adopting new health and safety procedures (67%), cancelling major events (64%) and halting business travel (53%).
Meanwhile, other respondents, when asked for their advice for business leaders, recommended the following:
- Focus on the facts
- Communicate regularly with employees and stakeholders/customers
- Stabilize supply chains
- Make short-term and long-term plans
Citation: The Survey was conducted by YPO a global leadership community of more than 29,000 chief executives in 130 countries. Full Press Release
USMCA AGREEMENT IS A WIN FOR THE NORTH WEST VALLEY
By any measure, the push to get the U.S.-Mexico-Canada Agreement (USMCA) passed — which preserves and strengthens our economic ties with our neighbors and top two export markets — was a three-year-long process. And it did not happen by accident.
The U.S. Chamber, the Surprise Regional Chamber as well thousands of chambers from around the country put the full weight of our alliances behind this historic effort. A special thank you to all local businesses in our region who contacted their elected officials and encouraged them to support the agreement. The new U.S.-Mexico-Canada Agreement is expected to usher tangible benefits for the NW Valley including agriculture, technology, manufacturing, and other business sectors, industry analysts say.
Here’s a brief overview of what’s in it:
- Country of origin rules: Automobiles must have 75 percent of their components manufactured in Mexico, the US, or Canada to qualify for zero tariffs (up from 62.5 percent under NAFTA).
- Labor provisions: 40 to 45 percent of automobile parts must be made by workers who earn at least $16 an hour by 2023. Mexico agreed to pass new labor laws to give greater protection to workers, including migrants and women. Most notably, these laws are supposed to make it easier for Mexican workers to unionize.
- US farmers get more access to the Canadian dairy market: The US got Canada to open up its dairy market to US farmers, a big issue for Trump.
- Intellectual property and digital trade: The deal extends the terms of copyright to 70 years beyond the life of the author (up from 50). It also includes new provisions to deal with the digital economy, such as prohibiting duties on things like music and ebooks, and protections for internet companies, so they’re not liable for content their users produce.
- Sunset clause: The agreement adds a 16-year sunset clause — meaning the terms of the agreement expire, or “sunset,” after 16 years. The deal is also subject to review every six years, at which point the US, Mexico, and Canada can decide to extend the USMCA.
First-Ever Scorecard Released
Who Made the List? Our first-ever scorecard evaluates the votes of each state senator and representative and represents the positions of the West Valley Chamber Alliance that were communicated to our state lawmakers throughout the 2019 Regular Session. The scorecard helps the business community know where their elected officials stand on issues that affect us all. Click Here for Full Report
The Surprise Regional Chamber of Commerce (Districts 13, 21 and 22) would like to recognize Rick Gray, Frank Carroll, Tim Dunn and Joanne Osborne for having 100% scores in support of pro-business policies.
As a Chamber, we commend those elected leaders with scores above 80% and recognize them as Free Enterprise Champions for recognizing the vital role businesses play and supporting those businesses through common sense, pro-business, and growth-oriented public policy. All elected officials in Districts 13, 21 and 22 earned the Free Enterprise Champion designation which included Rick Gray, Ben Toma, Frank Carroll, Kevin Payne, Tony Rivera, David Livingston, Tim Dunn, Joanne Osborne and Sine Kerr.
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TAKE THE SURVEY NOW
2020 Business Climate Census Survey
Many in our business community are experiencing both challenges and successes as our economy grows. As we work to secure the NW Valley's future, it is crucial that the Surprise Regional Chamber of Commerce understand what issues are most important to businesses. The purpose of the Business Climate Survey is to track trends and issues affecting businesses and to inform elected officials about the issues and concerns of the local business community.
Click Here Now, To Take Our Annual Business Climate Survey
2020 Business Climate Census Survey
Many in our business community are experiencing both challenges and successes as our economy grows. As we work to secure the NW Valley's future, it is crucial that the Surprise Regional Chamber of Commerce understand what issues are most important to businesses. The purpose of the Business Climate Survey is to track trends and issues affecting businesses and to inform elected officials about the issues and concerns of the local business community.
Click Here Now, To Take Our Annual Business Climate Survey
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